The Crony Ratio£800 Million in COVID Contracts to Donors WHO Have Given£8 Million to Conservatives
Byline Times and The Citizens add up the staggering total value of deals awarded during the Coronavirus pandemic to donors of the Conservative Party
Government contracts worth £881 million have been awarded to individuals who have donated a total of £8.2 million to the Conservative Party in recent years, Byline Times and The Citizens can reveal.
These contracts span across the various projects undertaken by the Government during the Coronavirus pandemic – from the procurement of personal protective equipment (PPE), to the provision of laptops for school children forced to study from home.
There is no evidence that the Government awarded these contracts in direct exchange for the donations; no monthly meeting where ministers assigned departmental work to the highest bidder. Rather, the Conservative Party has promoted the idea of outsourcing public services to private companies in recent decades – an ideology that has been ruthlessly applied during the COVID-19 crisis.
Private companies therefore see a commercial benefit – supplemented by the Conservatives’ low-tax mantra – to help the party to win power: the donations roll in, the party gets elected, and public sector contracts in turn roll out to the market.
This isn’t a question of wrongdoing on the part of the companies – they are simply acting in their commercial interest. The question is about a system that positively encourages large contributions to political parties from private individuals and firms, yet does not prevent these very same companies from acquiring, if only by coincidence, high-value Government work.
This process has of course been put on steroids during the Coronavirus pandemic, when Government contracts worth some £18 billion have been outsourced to the private sector in less than 12 months.
Here are some of the individuals and firms to have benefitted.
Wol Kolade, Livingbridge
Contracts: £5.9 million
Oluwole ‘Wol’ Kolade is the managing partner of Livingbridge, a global investment company, listed by Companies House as the one “persons with significant control” of Livingbridge EP LLP.
Since 2002, Kolade has made more than 20 personal donations to the Conservative Party, amounting to £678,000. This has included a £10,000 donation in 2019 to Health and Social Care Secretary Matt Hancock, and donations amounting to £39,854 this year.
Kolade is also a member of the elite Conservative ‘Leader’s Group’ dining society – that provides access to senior Tory politicians for large donations. Kolade was one of the most prolific attendees of Leader’s Group meetings between 2013 and 2018, according to openDemocracy, attending 13 events. Membership of this group allowed Kolade to have a private dinner with former Prime Minister Theresa May.
Since August 2018, Kolade has also sat as a non-executive director of NHS Improvement – the body responsible for overseeing NHS trusts. The chair of NHS Improvement is Baroness Dido Harding, who also runs the UK’s COVID-19 ‘Test and Trace’ system.
Livingbridge invests in a large array of companies and it is unclear how much influence is wielded by Kolade over the various projects.
However, since last April, a company linked to Livingbridge, called Efficio, has won COVID-19 contracts worth at least £5.9 million. Efficio describes itself as “the world’s largest procurement consultancy” and has won contracts from the Cabinet Office, the Department of Health and Social Care (DHSC) and NHS England for a range of critical services, not least supporting the procurement of PPE and testing services, and assisting with the delivery of vaccines.
Companies House records show that Livingbridge holds between 50% and 100% of the shares in Efficio Global Limited – the parent company for the various Efficio subsidiaries. Livingbridge also appears to control a firm called FIS Nominee Limited, which owns all of the ordinary class-A shares in Efficio.
Of the contracts won by Efficio during the Coronavirus pandemic, one has been granted without competition and five have been awarded through a framework agreement. The latter is effectively a shortlist of firms, selected through competition, that are able to bid for Government contracts in a certain field.
Efficio would not comment on the specifics of the awarded contracts but described Livingbridge as “a minority investor in our business”. A spokesperson added: “We are proud to partner with colleagues in the public sector and of the work we have done together during this period of unprecedented national challenge.”
Livingbridge announced on Monday that it has now agreed to sell its stake in Efficio to the company’s management team.
Livingbridge did not respond to Byline Times’ request for comment.
Scott Fletcher, ANS Group
Contracts: £2.5 million
Scott Fletcher founded ANS Group in 1996, as reportedly one of the UK’s “early movers in cloud computing”. While he resigned his ANS directorship in 2016, Fletcher is the owner of Project Daytona Limited, which owns ANS’ parent company, Project Daytona Bidco Limited.
The latest company accounts for ANS Group, for the period up to 31 March 2019, state that the “ultimate and controlling parent” for Project Daytona Limited, and by virtue ANS Group, is a firm called Lowry Trading Limited.
Fletcher is one of two shareholders in Lowry Trading, having founded the company in 2007. The latest ANS Group accounts state that “the company considers Scott Fletcher to be the ultimate controlling party of the company”. The only other director of Lowry Trading is an individual named Stephen Fletcher.
Since 2014, Lowry Trading Limited has donated £240,500 to the Conservative Party. This includes £25,000 to the central party in 2014, £25,000 in 2016, £50,000 in 2017, £37,000 in 2018, £100,000 in 2019 and £3,500 to the local Broxstowe Conservative Party in the same year.
ANS Group has been awarded four contracts for the supply of IT “cloud” services to the DHSC and NHS England since April 2020. ANS Group appears to be providing services to host and maintain the Government’s COVID-19 contact tracing app, seemingly working in conjunction with Amazon Web Services.
In addition, ANS claims that it is working with Microsoft and the ‘Test and Trace’ programme to “help local authorities identify and contain potential outbreaks in places such as workplaces, housing complexes, care homes and schools”.
Neither ANS Group nor Fletcher responded to Byline Times request for comment.
David Meller, Meller Designs
Contracts: £163.5 million
Beginning on 6 May, Meller Designs was awarded a series of DHSC contracts for the supply of PPE. A firm that typically specialises in supplying home and beauty products to high street retailers, including Marks & Spencer, Meller Designs has to date been awarded contracts for the supply of masks and hand sanitiser worth at least £163.5 million.
None of the contracts released so far have gone through normal competition procedures.
Meller Designs is owned by David Meller, who has donated nearly £60,000 to Conservative politicians and the central party since 2009 – and has been an active member of Tory politics. Indeed, Meller was the finance chair of Michael Gove’s 2016 Conservative Party leadership campaign and donated £3,250 to the cause.
Records show that, on 6 April, Health Minister Lord James Bethell and Lord Andrew Feldman held a meeting with Meller Designs, “to discuss COVID-19 testing”.
Currently assisting the Government’s private sector procurement process, according to reports, Feldman was previously Chairman of the Conservative Party from 2010 to 2016.
Coincidentally or not, a large proportion of Meller’s Conservative donations were concentrated in the years that Feldman sat as chairman and fundraising tsar of the party. He has only donated £14,300 since 2016.
It is not known whether the supply of PPE was discussed during the meeting on 6 April, with neither the DHSC nor Meller Designs responding to Byline Times’ request for comment.
In a previous comment to The Times, a Meller Designs spokesperson said: “We are extremely proud of the role we played at the height of the crisis and managed to secure more than 150 million items of PPE.”
BROWSE THE ARCHIVE
Boris Johnson’s Crony Contracts
Michael Ashcroft, Medacs Healthcare
Donations: £5.9 million
Contracts: £350 million
The Government recently announced that a firm called Medacs Healthcare had been awarded a £350 million contract to provide laboratory staff to the UK’s testing operation.
Medacs, a global healthcare recruiting agency, is owned by Impellam Group – in turn owned by billionaire former Conservative Party deputy chairman Michael Ashcroft.
Since 2001, Ashcroft has donated £5.9 million to the Conservative Party. He sat as a Conservative peer in the House of Lords from 2000 to 2015, when he resigned largely due to controversy over his non-domiciled tax status.
Ashcroft’s spokesman told the Guardian that he was not involved in the negotiation of Medacs Healthcare’s contract with the DHSC and did not know about it until after it had been awarded.
Impellam said that the company “has not benefited from any connections that any non-executive may hold.” Indeed, Ashcroft currently acts as chairman of the company. “The non-executive directors do not have any involvement in the award of contracts or the operational, day-to-day management of the company,” the firm added.
Steve Parkin, Clipper Logistics
Contracts: £1.3 million
The Times reported in August that a firm called Clipper Logistics had won a £1.3 million contract from the Government to distribute PPE.
Its founder and executive chairman is Steve Parkin, who has donated £725,000 to the Conservative Party in recent years.
Clipper Logistics did not respond to Byline Times’ request for comment and declined to comment when approached by The Times.
Haraldur Agustsson, Globus (Shetland) & Alpha Solway
Contracts: £157.8 million
Globus (Shetland) Limited, a firm that has donated £375,000 to the Conservative Party since 2016, won a £93.8 million contract in July for the supply of FFP3 respirators.
The size of the donations given to the Conservative Party by Globus increased significantly in 2019 to £109,854, up from £52,500 the previous year.
Another firm in the Globus Group, called Alpha Solway, also won a contract worth £53 million to produce face masks for the Scottish Government, according to the company’s website – “fulfilling 87% of Scotland’s health and social care needs”. This adds to a number of other PPE contracts awarded to the firm, worth £11 million.
Globus Group did not respond to Byline Times’ request for comment.
Philip Hulme, Computacenter
Contracts: £198 million
In October, Private Eye reported that British IT company Computacenter had been awarded deals worth £96 million for the provision of laptops, tablets and Wi-Fi devices for schools, to help pupils learn online during lockdown.
Byline Times subsequently revealed that, since that time, additional contracts worth almost £100 million for the provision of school technology equipment have been awarded to the firm.
Computacenter is an experienced firm, posting annual revenues of roughly £5 billion, but the people behind the company have also dabbled in political fundraising.
Sir Philip Hulme, the firm’s co-founder – who remains a non-executive director and shareholder – has ties to the Conservative Party. In 2013, Philip Hulme donated £10,000 to Nick Herbert, a Conservative MP from 2005 to 2019.
Prior to the 2019 General Election, his wife Janet also donated £100,000 to the party’s war chest. On 15 November 2019 – a day after Janet Hulme’s donation – an individual called George Hulme also gave £50,000 to the Conservative Party, though it is unclear whether the pair are related. Of course, it is up to individuals and firms whether to donate to political parties and they can make those decisions independently.
In response to Private Eye, Computacenter said that it was “very proud to have played a small role in this vital programme to support the educational needs of some the most disadvantaged young people” during the Coronavirus pandemic.
All but one of the contracts were awarded under a framework agreement, bidding in competition with other firms.
The company declined to comment further to Byline Times.
Sir Peter Rigby, Specialist Computer Centres
Contracts: £2.1 million
Another company to have benefitted from the Government’s procurement of school laptop devices is a company called Specialist Computer Centres (SCC).
The firm won a contract for the provision of 10,000 devices from October 2020 to October 2021, worth £2.1 million.
SCC is owned by Rigby Group Plc, which donated £50,000 to the central party in 2019, following a donation of £55,000 in 2017.
The company appears to be majority-owned by its founder and chairman Sir Peter Rigby, who owns 17 million class-A shares.
As with many of the other companies mentioned above, SCC is an IT company with annual revenues of £2 billion, so there is little doubting its expertise in this field. However, it does clearly buttress the trend of Government contracts being awarded to firms that have donated to the Conservative Party.
Neither SCC nor Rigby Group responded to Byline Times’ request for comment.
A Contracting Crisis
Shadow Cabinet Office Minister Rachel Reeves told Byline Times that “the lack of transparency around the Government’s contracting process has badly damaged public trust in procurement, and contracts going to Conservative friends and donors do little to restore that”.
“This Government must clean up its contracting now, allowing more scrutiny to put to bed growing concerns of cronyism,” she added.
The distribution of contracts to allies of the Conservative Party has been a subject of concern and controversy among official bodies and the public at large during the COVID-19 pandemic.
In November, responding to public pressure, the National Audit Office (NAO) produced a report, analysing the Government’s procurement process. The final evidence was not flattering – explaining how officials regularly failed to log basic conflicts of interest, despite the significantly increased likelihood of a company winning a contract if it knew a minister or an MP.
And it’s not as though the Government – in cahoots with private sector partners – managed to cultivate a “world-beating” response to the pandemic, as Boris Johnson promised.
Two subsequent NAO reports explained in graphic detail how frontline health workers were forced to procure their own PPE, due to Government delays, while the nation’s testing and contact tracing operation virtually imploded amid surging case numbers.
In total, it is estimated that the Government has spent at least £18 billion on private sector contracts during the pandemic – meaning that roughly 5% of the total expenditure has been awarded to firms that have donated to the Conservative Party, either directly or through their owners.
Some MPs are therefore now taking up the baton of reform. Last week, a ‘Crony Bill’ was introduced to the House of Commons by Scottish National Party MP Owen Thompson. If passed, the legislation would ensure that MPs can interrogate ministers about any personal, political or financial connections they may have to a company that is awarded a Government contract.
Garnering support across opposition parties, the Bill passed its first hurdle in the Commons and will now be the subject of a formal debate and vote. However, its success will rely on persuading the Conservative Party that both the reality and the perception of cronyism poses a threat to public trust in the Government.
This seems unlikely, given that various departments have repeatedly insisted that proper due diligence was carried out before each and every contract was awarded. As throughout history, wilful delusion appears to stand in the way of reform.
Additional reporting by Iain Overton and Max Colbert
The Citizens is a non-profit organisation that has been investigating contracts awarded during the Coronavirus pandemic. Follow the group on Twitter @AllTheCitizens
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