Labour is demanding an investigation into a leaked dossier which shows hundreds of millions of pounds worth of coronavirus contracts were handed to “VIPs”.
Documents leaked by the Good Law Project, an anti-corruption watchdog, allegedly expose special procurement channels that allowed contractors to bid for work without needing to undergo the normal tendering process.
The organisation – which has launched a legal case – claims the Cabinet Office was “feeding its contacts into the procurement process” and that the value of contracts was only evaluated if prices were “25% above the average”.
Shadow cabinet office minister Rachel Reeves accused ministers of “putting the profit of their friends and donors above NHS workers” who were in desperate need of Personal Protective Equipment (PPE) at the height of the pandemic.
She said: “The deeper you delve into this Tory government’s Covid outsourcing, the more disturbing it gets.
“Not only were some of these ‘VIPs’ paid over the odds – in one case for unusable PPE – they were awarded these contracts at the height of the crisis when our NHS workers needed urgent, high-quality PPE.”
The Good Law Project claimed firms made “enormous margins” of up to 45% on contracts worth “hundreds of millions of pounds”.
It alleges three companies, all with connections to Tory figures, were handed more than £500 million in government contracts.
Labour has previously called for an investigation from the National Audit Office (NAO) into the government’s procurement decisions.
The NAO is already looking into deals worth more than £830 million which were awarded to at least 12 different companies earlier this year.
Among the deals that have raised eyebrows is a £32 million contract to pest control firm PestFix, a company with listed net assets of only £18,000, to source surgical gowns.
Public First was paid £500,000 to assess the effectiveness of the government’s coronavirus advice even though it was listed as contributing Brexit-related research.
The firm’s co-owner, James Frayne, has worked with Michael Gove while he was education secretary and on several projects in the past with the prime minister’s senior adviser, Dominic Cummings.
Critics have said much of the work was not advertised and that no official notice of the award was published.
A government spokesperson said: “We have been working tirelessly to deliver PPE to protect our health and social care staff throughout the pandemic, with more than 4.4 billion items delivered so far and 32 billion items ordered to provide a continuous supply to the frontline over the coming months.
“Proper due diligence is carried out for all government contracts and we take these checks extremely seriously.”