£40.5 Million in PPE ContractsAwarded to ‘Micro’ Firm
The company has £134,500 assets yet has been awarded contracts worth tens of millions by the Government, reports Sam Bright
The Government awarded contracts for the supply of personal protective equipment (PPE) to a small, one-year-old ‘micro’ firm with a limited balance sheet, Byline Times can reveal.
Government documents released last week show two deals awarded to Rehear Labs Limited totalling £40.5 million. The first, worth £9.7 million, began on 17 April and ended on 30 May, for the supply of face shields and gloves. The second, worth £30.7 million, began on 29 May and ended on 2 June, also for the supply of gloves.
Neither contract was subject to competition from other firms, taking advantage of an EU loophole that allows for streamlined procurement procedures in the event of an emergency.
Rehear Labs was incorporated in late February 2019 by Gavin Hutcheson and Declan Graham. The latter, who owned the majority of shares, subsequently left the company in July this year, Companies House records show.
The firm does not appear to have a website, though its Companies House page states that it manufactures “medical and dental instruments and supplies”.
The first balance sheet produced by the company, however, is threadbare. The firm invoked its right to produce a ‘micro’ balance sheet – a parsed-down version of company accounts – due to its limited revenue and staffing. However, from the information that is available, the firm lists no current liabilities (strange for an actively trading entity), no creditors, nor provisions for liabilities. The only figure on the balance sheet is £134,500 net assets.
Companies House records further show that Rehear Labs was first set up as a public limited company in January 2019. However, the firm transformed into a private limited company under the name DGGH Limited in April 2019. This month, Companies House issued the first notice of its intention to strike off DGGH Ltd and dissolve the company, “unless cause is shown to the contrary”.
There is no suggestion of wrongdoing on behalf of Rehear Labs in receiving two large PPE contracts from the Government. Rather, it is simply unclear why the firm was selected, given its small size and limited trading history.
Rehear Labs has been approached for comment.
Accountability for Outsourcing
Desperate to replenish the UK’s stockpile of PPE to cope with the Coronavirus pandemic, the Government allocated a budget of £13.8 billion – overseen by a ‘PPE Tsar’ – to procure equipment from private companies.
However, a number of the suppliers selected have unconvincing CVs in the field of PPE. Byline Times has revealed that Government contracts worth millions of pounds have been awarded to a small luxury packaging company, a 44 day-old firm, a dormant company with one director, a lifestyle firm with no trading history, a hotel carpeting company, and a fashion designer based in Miami.
There have also been questions raised around Government cronyism, with firms linked to the Conservative Party grabbing deals worth at least £526.3 million.
The Government has not been forthcoming in providing any clarification on the contracts and appears unwilling to account for its actions.
Basic details of the contracts are released months after they have been awarded, rarely accompanied by any proof that the contract was successful or a rationale for why the firm in question was selected. Ministers have also ducked questions from concerned MPs – inviting scrutiny and then entirely failing to respond.
The National Audit Office – an independent body that appraises Government spending – is currently undertaking a review into the procurement of PPE during the Coronavirus pandemic. Set to be released in the Autumn, this author will be stocking up on popcorn in anticipation.
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