COVID-19: Billions of pounds of taxpayers' money still at risk as a result of government's handling of PPE contracts, spending watchdog warns
The National Audit Office found the Department of Health and Social Care was being charged millions of pounds to store PPE equipment and billions of items were not suitable for frontline use.
Wednesday 30 March 2022 12:42, UK
Billions of pounds worth of taxpayers' money is still at risk as the government continues to deal with issues with personal protective equipment (PPE) stocks and contracts, according to the spending watchdog.
The National Audit Office (NAO) found the Department of Health and Social Care (DHSC) was being charged millions of pounds to store PPE equipment it has purchased for longer than expected.
It also found there were "inconsistencies" between the volume of PPE ordered and what was actually received, and that billions of items were not suitable for frontline use.
Government still dealing with issues
Two years after the beginning of the coronavirus pandemic, the DHSC is still dealing with issues with some of the nearly 10,000 contracts drawn up to purchase almost 38 billion items of PPE, the NAO report said.
It found more than half of suppliers given contracts via a VIP fast-track stream, where firms could be recommended by government officials, ministers' offices, members of Parliament, senior NHS staff and other health professionals, had provided unsuitable items.
Some of the reasons the items were unsuitable was because they would have been too time-consuming to assemble, there were concerns about modern slavery, or paperwork was missing.
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The report also found some 1.5 billion items in storage have now passed their expiry date.
A spokesperson for the DHSC said having too much PPE was preferable to not having enough.
Five upfront contracts worth £19m at risk of not being delivered
Some 9,492 contracts worth £5.2bn were agreed through the existing NHS supply chain, while the remaining 394 contracts were awarded by the DHSC.
The report said the DHSC paid £2.5bn to suppliers upfront before PPE was received in order to "prevent contracted PPE being gazumped while in transit".
Five of those upfront contracts, worth £19m, are at risk of not being delivered, the report added.
Billions of items remain in storage
The report said of the PPE which has been received, 17.3 billion items (55%) have been sent to frontline staff, though 14.1 billion items worth £8.5bn remain in storage, either in one of 50 warehouses, with suppliers, or in shipping containers.
By November 2021 it had cost the government £737m to store PPE, the report said, with £436m of that being in penalty charges because the DHSC could not move the items out of shipping containers in time.
The report also said the DHSC estimated it had 3.9 billion items of PPE it did not need, with an extra five billion due to be delivered. It was spending around £7m a month to store the current stock.
Some £2.7bn at risk
The report said there are 176 contracts where the government believes "it may not achieve full value for money", with an estimated £2.7bn at risk.
Labour MP Dame Meg Hillier, chair of the Commons Public Accounts Committee, said: "The numbers are staggering - over 30 billion items of PPE received so far with five billion more on the way and 3.6 billion items that can't be used by frontline services.
"Storage alone has cost over £700m, with DHSC continuing to spend £7m a month storing PPE it doesn't need.
"Whatever forbearance the taxpayer may have had at the start of the pandemic, this will quickly wear thin if DHSC can't now manage the consequences.
"The department must urgently get a grip of its PPE stocks and focus on protecting value for taxpayers. It has to claw back contract costs where it can, get rid of unusable PPE, and cut down on expensive storage."
A spokesperson for the DHSC said: "Our priority throughout the pandemic has been saving lives, and we have delivered over 19.1 billion items of PPE to frontline staff to keep them safe.
"Having too much PPE was preferable to having too little in the face of an unpredictable and dangerous virus, given this was essential to keep our NHS open and protect as many people as possible.
"Where contracts are in dispute, we are seeking to recover costs from suppliers and we expect to recover significant amounts of taxpayers' money."