Oz Blog News Commentary

Contract Killers

July 19, 2020 - 17:15 -- Admin

Coronavirus deals
worth billions of bounds have been awarded by the government to “unusual”
companies, without advertising or competition.

By George Monbiot,
published in the Guardian 15th July 2020

stinks. It stinks worse than any of the other carrion this government has
buried. Every day for the past fortnight, I’ve been asking myself why this
scandal isn’t all over the front pages. Under cover of the pandemic, the
government has awarded contracts worth billions of pounds for equipment on
which our lives depend, without competition or transparency. It has trampled
its own rules, operated secretly and made incomprehensible and – in some cases
– highly suspicious decisions.

begin with the latest case, unearthed by investigative journalists at the Guardian and openDemocracy. It
involves a contract to test the effectiveness of the government’s coronavirus
messaging, worth £840,000. It was issued by the Cabinet Office, which is run by
Michael Gove. The deal appears to have been struck on March 3, but the only
written record in the public domain is a letter written on June 5,
retrospectively offering the contract that had already been granted. There was
no advertisement for the work, and no competition. No official notice of the
award has yet been published. The deal appears to have been done with a
handshake and a slap on the back.

But we do
know who the contract went to. It’s a company called Public
, owned by a married couple, James Frayne and
Rachel Wolf. Since 2000, James Frayne has worked on political campaigns with
Dominic Cummings, Boris Johnson’s chief adviser. When Michael Gove was
education secretary, he brought both Cummings and Frayne into his department.
Cummings was Gove’s chief political adviser, while Frayne was his director of communications. At
roughly the same time, in 2010, Gove’s Department awarded Rachel Wolf a
£500,000 contract to promote his “free schools” obsession. Guess what? That didn’t go to competitive tender, either.
Rachel Wolf co-wrote the Conservative party’s election manifesto in 2019.

response to these revelations, the government claims it had to override the
usual rules for public procurement because it was responding to an emergency.
There are several problems with this claim. The first is that it had six weeks
to prepare for the pandemic, before the deal was done. The second is that, of
the four contracted services later listed on the
government’s website, two were not for testing the government’s coronavirus
messaging at all, but for “EU exit comms”: in other words, Brexit. The
coronavirus work, according to this list, did not begin until May 27. The
Cabinet Office now claims that when it said “EU exit”, it meant coronavirus.
This seems an odd mistake to make. The third problem is that the government’s
communications on the pandemic have been disastrous. Did it
choose to ignore Public First’s “emergency” work, or was it of little value?

On Friday, the Good Law Project issued proceedings in the High Court against Michael Gove, alleging breaches of procurement law and apparent bias in the grant of the contract to his long-standing associates. It is crowdfunding the challenge.

But this,
extraordinary as it is, is not the strangest of the cases the Good Law Project
is taking on. Another involves a pest control company in Sussex called PestFix,
which has listed net assets of only
£18,000. On April 13, again without public advertisement or competition, the
government awarded PestFix a £32 million contract to supply surgical gowns.
PestFix is not a manufacturer, but an intermediary (its founder calls it
a public
health supply business
): its role
was to order the gowns from China. But, perhaps because of its lack of assets,
the government gave it a deposit worth 75% of the
value of the contract. The government’s own rules state that prepayments should
be made only “in extremely limited and exceptional circumstances”, and even
then must be “capped
at 25% of the value of the contract”.

If the
government had to provide the money upfront, why didn’t order the gowns itself?
And why, of all possible outsourcers, did it choose PestFix? In the two weeks
before it awarded this contract, it was approached by 16,000 companies offering
to supply protective equipment (PPE). Some of them had a long track record in
manufacturing or supplying PPE, and had stocks that could be deployed

Again, the
government relies on the emergency defence to justify its decision. But it
issued its initial guidance on preventing infection among health and care
workers on January
. On
February 14, it published specific guidance on the use of PPE. So why did it
wait until April 13 to strike its “emergency” deal with PestFix? Moreover, it
appears to have set the company no deadline for the delivery of the gowns.
Astonishingly, even today only half of them appear to have reached the UK, and
all those are still sitting in a warehouse in Daventry. On the government’s own admission, “none of
the isolation suits delivered so far has been supplied into the NHS”. So much
for taking urgent action in response to the emergency.

Again, the
contract is surrounded by secrecy. Crucial sections, such as the price paid for
the gowns, have been redacted. Bizarrely, the award notice initially stated
that the contract was worth £108 million. But in responding to the lawsuit, the
government claimed it had made a mistake: the real value is £32 million.
Apparently, it struck “further contracts” with PestFix for other items of
equipment. It has so far failed to reveal what these might be, or to publish
the contracts. It is worth remembering that while all this was happening,
frontline health and care workers were dying as a result of inadequate supplies of PPE.

There are
plenty of other cases: such as the employment agency with net assets of £623, which was awarded an £18 million government contract to supply
facemasks; the confectionery wholesaler given a £100 million contract to supply
PPE; and the £250 million channelled through a “family office” registered
in Mauritius, specialising in currency trading, offshore property and private
equity, also to supply
protective medical equipment. Altogether, billions of pounds’ worth of
contracts appear to have been granted, often to surprising companies, without competition. I think we may reasonably ask what the hell is going on.

This is
not just about value for money, important as that is. Transparent, competitive
tendering is a crucial defence against cronyism and corruption. It is essential
to integrity in public life and public trust in politics. But the government
doesn’t seem to care. As the scandal over Dominic Cummings’s trip to Durham
shows, its strategy is to brazen out disgrace until public outrage subsides. We
know it cheats and lies. It knows that we know, and it doesn’t care.

But these
things matter. People die when the government gets them wrong. Our challenge is
to discover how to make them count.