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Government Faces Both Wayson Conflicts of Interest
New official guidance makes a mockery of the UK’s procurement policies during the Coronavirus pandemic, reports Sam Bright
The outpouring of public money to private firms during the Coronavirus pandemic has been biblical. A plague has inflicted the UK and the world, and the Government’s immediate response was to place its faith – to form a “partnership”, in its own words – with private sector suppliers.
Two thousand consultants have been employed on the UK’s testing and contact tracing programme at an average cost of £1,000 a day; another £1 billion contract has just been published for lateral flow tests purchased from a private firm; at least £10 billion in deals were awarded to companies for COVID-related goods and services without competitive tender.
Yet, as Byline Times readers will be aware, this cross-pollination of the public and private realms has not been without controversy. This newspaper has calculated that at least £3 billion in COVID-related contracts have been awarded to Conservative Party donors and associates. Contracts have been awarded to firms with ties to Government ministers, procurement advisors, and officials at the centre of the UK’s pandemic response.
Throughout the crisis, as these stories have emerged and compounded, the Government’s line has been firm: proper due diligence was undertaken on all contracts, as goods and services were procured rapidly in the national interest.
When pressed about these stories, ministers have been dismissive and often bullish. A recent story alleged that the Home Secretary, Priti Patel, lobbied her Cabinet colleagues about a firm that went on to win more than £100 million in personal protective equipment (PPE) deals. Patel had allegedly been made aware of the company by one of her former advisors.
Yet, Paymaster General Penny Mordaunt, speaking in the House of Commons last week, waved away any suggestion of impropriety. “I would suggest to her that an Essex MP [Priti Patel] is perfectly entitled to forward a member of help from the Essex Chamber of Commerce,” she said.
However, while the Government defends its actions publicly, it is not providing the same message in less well publicised forums.
Last week, the Government via the Cabinet Office provided an update to its guidance on managing conflicts of interest in public sector procurement, designed to inform all departments.
The guidance states that “far-reaching consequences” can result if conflicts of interest cannot be managed appropriately. According to the Government, these far-reaching consequences can include:
- Reputational damage, undermining public confidence in the integrity of the organisation and Government as a whole
- An impression that the organisation or individual is not acting in the public interest
- Breach of the Ministerial or Civil Service Code
- Prosecution of individuals for fraud, bribery or corruption through abuse of position or misconduct in public office
- Exposure to accusations of collusion
- Potential risk of legal challenge for breach of the regulations and/or on public law grounds of actual or apparent bias
According to the guidance, there are three forms of conflict of interest that can give rise to these issues: actual, potential and perceived. The former two relate to whether a public official who has or may intervene in the procurement process has a commercial interest in a company involved.
The third – perceived conflicts of interest – relate to whether a public official’s private interests could improperly influence procurement, even if they have not intervened in the process. The guidance gives the example of a senior figure in a department who has known connections to a company that is engaging in a public sector procurement process. The Government official has no involvement in the decision to award a contract or not, but there is a reasonable perception that such influence could take place.
This is significant. The weekend after the story involving Priti Patel attracted a media frenzy, Health and Social Care Secretary Matt Hancock defended her – and his own department – by saying that ministers are not involved in the awarding of contracts to individual firms. Indeed, this has been the Government’s standard defence to accusations of perceived cronyism – a line that has been sent to me repeatedly by press officers during the pandemic.
However, as the Government’s own advice makes patently clear, this doesn’t matter. There can be justifiable conflict of interest concerns stemming from essentially any meaningful relationship between a senior individual in Government and a private firm that has obtained or is trying to obtain public contracts.
A £300,000 contract awarded to a close associate of the Government’s PPE tsar; a £38 million contract won by a firm chaired by a procurement advisor; a £253 million deal awarded to a firm linked to a member of the Government’s Board of Trade; two contracts won by firms with ties to Matt Hancock and his family; a £22.6 million deal awarded to a company that has been advised by a Government procurement official.
These stories have all been exposed during the pandemic and are all examples of perceived conflicts of interest, yet they have not provoked an explanation or an apology from the Government.
The procurement scandal has, at times, been portrayed in the media as a ‘conspiracy theory’; an attempt by journalists to find connections that simply do not exist. The fact is, we have simply been holding the Government to its own rules.