Commons Sense

House of Commons · Ministers' Questions

Covid-19: Procurement Fraud

Thursday 29 February 2024 · 4 questions

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Answered 1 Partly answered 3 Not answered 0

Key points

  • The Government's "Cross-Government Fraud Landscape Annual Report 2022" indicates that 124.6 million of detected procurement fraud was reported by Government Departments and arm's length bodies in 2020-21.
  • The Government reports that 1.8% of expenditure on PPE was lost to fraud during the pandemic.
  • The Procurement Act 2023, passed last year, aims to improve procurement practices in the UK.

Topics (select to filter)

Questions & Answers

Q1 Sarah Edwards Lab Tamworth
Economy Standards & Ethics
Context

The question stems from an inquiry into public expenditure losses due to procurement fraud related to the pandemic. The Government had released a report detailing detected procurement fraud costs for 2020-21.

Question

What recent estimate has been made of the cost to the public purse of procurement fraud during the covid-19 pandemic?

Answer from Alex Burghart

The Government's “Cross-Government Fraud Landscape Annual Report 2022” includes data from the first year of the Government's response to the pandemic. The report suggests that in 2020-21, Government Departments and arm's length bodies reported a total of £124.6 million of detected procurement fraud. The same report showed that at the end of March 2021, some £88.2 million of fraud and error had been recovered within covid-19 schemes. Since then, crucially, further funds have been recovered and the Government will continue to update the House as fresh data becomes available.

Answered
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Q2 Justin Madders Lab Ellesmere Port and Bromborough
NHS
Context

The question arises from public concern over the handling of personal protective equipment (PPE) during the pandemic, particularly regarding fraudulent activities. There is a desire for a dedicated officer to oversee recovery efforts.

Question

When people think back to the sacrifices they made during the pandemic, the greed associated with the PPE scandal jars with them; will the Minister commit to following Labour's lead and appoint a covid corruption commissioner to chase down and claw back every penny of taxpayers' money wasted?

Answer from Alex Burghart

This Government take PPE fraud extremely seriously. To remind the House of the figures, 1.8% of expenditure on PPE was lost to fraud at a time when there was the most extraordinary public crisis in several generations and we were competing in an extremely overheated international market. To date, we have recovered more than a quarter of that 1.8% and the fight to recover more continues. PPE procurement is subject to ongoing contract management controls, active dispute resolution and recovery action. The law is on our side and we are using it.

Partly answered

Not addressed: commitment to appoint a dedicated commissioner

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Q3 Sarah Edwards Lab Tamworth
Business & Trade
Context

The question relates to the exclusion of a local business, Wearwell (UK), from regional procurement during the pandemic. There is concern about relying on international suppliers and interest in prioritizing domestic manufacturing.

Question

The covid procurement scandal upset many people; I spoke with a fantastic local business in Tamworth that was manufacturing PPE as part of the regional procurement but was cut out of the process during the pandemic. The UK must be prepared for another pandemic, and British manufacturing offers a faster response time and more stable supply chain. When will we return to regional procurement to prioritize local businesses when providing PPE?

Answer from Alex Burghart

I welcome the hon. Lady to what I think are her first Cabinet Office questions. She is right to draw attention to the fantastic textile manufacturing that exists in the region in which her constituency sits. She will have heard me talk about the Procurement Act 2023, which was passed last year and will make sure that small and medium-sized enterprises, which by their nature are often local enterprises, will have a bigger share of public procurement.

Partly answered

Not addressed: specific timeline for returning to regional procurement

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Q4 Jon Ashworth Lab
NHS
Context

The question addresses discrepancies between the previous Health Secretary's assurances about non-payment for undelivered PPE and actual expenditure. There are concerns over the government's accountability regarding contracts that were not fulfilled.

Question

We had scandals such as Baroness Mone's; at the time, there was a hedge fund in Mauritius getting £250 million for face masks unusable and a jeweller in Florida receiving millions for gowns unusable. The Government incinerated billions of pounds worth of faulty PPE. That is taxpayers' money literally going up in smoke. Yet, the Health Secretary said: 'where a contract is not delivered against, we do not intend to pay taxpayers' money.' But taxpayers' money was spent; why wasn't that promise met?

Answer from Alex Burghart

I gently refer the right hon. Gentleman to the answer I just gave. The fact is that, although problems arose with PPE procurement in this uniquely difficult environment in which officials were working unbelievably hard for the public good, PPE procurement is still subject to ongoing contract management controls, active dispute resolution and recovery action. The Department of Health and Social Care realised the risk of fraud early on, established a counter-fraud team, and used legal tools to recover taxpayers' money.

Partly answered

Not addressed: explanation for not meeting the promise to withhold payment for undelivered contracts

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