£203 Million Financial Boost for COVID Contract Winners With Conservative Links

£203 Million Financial BoostFor COVID Contract Winners With Conservative Links

Max Colbert digs into the latest accounts of firms that were awarded hundreds of millions in Government deals

Seven Conservative-linked firms that won contracts during the COVID pandemic have seen their profits more than quadruple during their latest accounting periods, while a further five have seen their assets double, representing a cumulative financial boost of more than £203.8 million, the Byline Intelligence Team and The Citizens can reveal.

We previously revealed that £3 billion in contracts had been awarded to firms with links to either Conservative donors or those otherwise associated with the party or the Government during the height of the pandemic. 30 companies, 15 featuring donors, were found to have been awarded lucrative work during this time.

The Byline Intelligence Team and The Citizens previously revealed that 12 of these Conservative-linked firms had recorded additional profits of £121.7 million during their latest accounting periods, an overall average increase of 57.1%. The increase, including the 12 new firms that have filed accounts for the period, brings the financial boost to £325.5 million for the 24 companies with Conservative links to have filed their accounts. 

A further five are either overdue, yet to file, didn’t fulfil the contract, or are under criminal investigation.

There’s no suggestion of wrongdoing on the part of any of the firms or the individuals involved; it was the Government that suspended normal procurement practices, introduced an expedited system for awarding contracts, and allocated taxpayer resources in this way.

Randox, which registered profits of £177.3 million during the latest accounting period, was awarded £777 million in COVID contracts, though says that it has been paid £469 million. It is known that Owen Paterson, who was at the time a sitting Conservative MP, urged then Health and Social Care Secretary Matt Hancock to speed up the purchasing of COVID tests produced by Randox – though both the company and the Government maintains that such lobbying had no role in the contracts.

An investigation by the Public Accounts Committee (PAC) into the Randox contracts found that it was “impossible to have confidence” that they “were awarded properly”, and accused the Government of “woefully inadequate record keeping”. A spokesperson for Randox called the PAC report “deeply flawed and wrong in assumptions it makes and the conclusions it draws”.

Protective equipment retailer Alpha Solway saw profits gains for the period of £16.5 million. The company is one of two firms under the control of Conservative donor Haraldur Agustsson, who via his company Globus Shetland has given nearly £400,000 to the Conservatives since 2016. Agustsson has also featured as an attending member of the Conservative fine-dining club the ‘Leader’s Group’.

Globus Shetland is listed as the entity with significant control over Alpha Solway and, between the two firms, they were awarded more than £104 million across seven contracts during the pandemic. Globus Shetland also doubled its post-tax profits, from £2.5 million to £5 million, over the latest relevant accounting period.

HSL Pathology also recorded a financial boost, posting a 459% profit increase, amounting to more than £10 million, up from £1.9 million the previous year. The firm was awarded nearly £60 million in contracts during the pandemic, mostly for PCR testing services.

The chairman of HSL is Lord Patrick Carter of Coles, who also sits as chair of the Department for Health and Social Care’s (DHSC) Procurement and Efficiency board. Another of HSL’s directors, Dr Vanya Grant, advises the Government’s innovation agency, Innovate UK. 

Speaking to Byline Times, a company spokesperson said that: “Having fallen in 2020, HSL’s income and profits recovered in 2021 as a result of the increased volume of testing across all pathology specialties to support the healthcare recovery in the UK… All HSL COVID-19 testing was carried out in partnership laboratories, whose profits benefit the NHS. HSL is very proud of its contribution to combatting COVID-19 and supporting the recovery of health services in hospitals and the community.”

A DHSC spokesperson previously added that: “As a result of our partnerships, including this agreement with HSL, we have been able to rapidly expand our testing capacity.”

Wernick Buildings, which manufactures modular and portable building units, was given a Government contract worth nearly £19 million in November 2020 for the supply of portable trailers and specialist equipment. The company saw an increase of 48% in its annual returns for the period up to December 2020. A previous investigation by the Byline Times revealed that the parent company, S Wernick & Sons (Holdings) Limited, has donated almost £60,000 to the Conservative Party since 2001, including £30,000 since 2019. 

“All contracts awarded to us during the pandemic have been both tendered for and awarded through the relevant bodies that we are an approved contractor on and at no stage has there been any involvement or interference by a politician,” company chairman David Wernick previously told Byline Times.

Another firm that undertook work alongside Wernick was Pickerings Hire, contracted for the “maintenance and removal of specialist trailers and hire of equipment”, likewise assisting with the construction of modular buildings for the UK’s testing programme. 

Pickerings is owned by John Stuart Bloor, a Conservative mega-donor, and Bloor Holdings. Bloor, through his various corporate entities, has donated more than £3.1 million to the Conservative Party since 2015, the latest being a hefty £150,000 in March 2021. Pickerings saw a profit increase of nearly 81% on the previous year, posting profits of £12 million.

Bunzl Retail and Healthcare Supplies UK, one of several iterations of Bunzl, won a Coronavirus contract worth £22.6 million, though its profits fell for the period ending December 2021, from £33.4 million to £18.5 million.

The contract was the subject of a legal dispute brought by the Good Law Project, as it transpired that former Conservative Party chairman Lord Andrew Feldman was involved in the deal.

Lord Feldman at the time was working unpaid in a role directly advising Junior Health Minister Lord James Bethell, while also working for public relations firm Tulchan, which listed Bunzl as a client. Emails show that Feldman directly intervened on behalf of Bunzl shortly before the firm was awarded the contract. 

A spokesperson for Lord Feldman has previously stated that he was “working as an unpaid advisor to the [DHSC] at a time of national emergency. He was doing this in a personal capacity… He properly disclosed to officials at the time that Bunzl was a client of Tulchan. Bunzl is a FTSE100 company and one of the largest distributors of [personal protective equipment] in the world. It was, at that time, already a significant supplier of PPE to the NHS. The decision to award any contracts to Bunzl was taken by officials and not by Lord Feldman.”

ANS Group, founded by Scott Fletcher, won four contracts worth £2.5 million in 2020, for work relating to the supply of IT cloud services for the DHSC.

Fletcher is listed in the ANS Group accounts as “the ultimate controlling party of the company”. However, our investigation found that the ‘ultimate and controlling parent’ of ANS Group was an entity called Lowry Trading, of which Fletcher is one of only two shareholders. Lowry Trading has in turn donated £240,500 to the Conservatives since 2014. The firm’s gross profits in its latest accounts increased by £3 million, from £15 million to £18 million.

All the companies mentioned in this article were approached for comment.

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Asset Increases

Next, Topham Guerin, a PR firm run by acolytes of Lynton Crosby – the Australian-conservative campaigns guru – Sean Topham and Ben Guerin. The company was awarded a £3 million pound contract, without tender, to run Coronavirus messaging via the Cabinet Office, and posted assets of £1.3 million against the previous year’s £177,593.

Previously, the pair had worked on the 2019 Conservative election campaign, where they were attributed with the controversial move to temporarily rebrand the Conservative Twitter page as ‘factcheckUK’ during a leaders’ debate, and responsible for spoofing a website set up to look like Labour’s manifesto. 

Topham Guerin wasn’t the only Conservative-linked consultancy to secure lucrative deals during the pandemic. Three others – Public First, Hanbury Strategy, and Freud Communications – were also awarded COVID-related work.

Public First, whose co-founders Rachel Wolf (who also co-authored the 2019 Conservative manifesto) and James Frayne are long-standing allies of Michael Gove and Dominic Cummings. Freud Communications, whose director Matthew Freud is a friend of former Prime Minister David Cameron, landed a £55,000 contract to create an ‘integrated NHS Test and Trace communications strategy’.

A spokesperson for Freud said: “We’re proud of our long-term association with the Department for Health and Social Care for whom we have worked continuously for over 15 years through a procurement process that strictly adheres to Government guidelines.’

Hanbury Strategy, another firm associated with Cummings, won a number of contracts worth a combined £1 million to conduct polling and focus groups in relation to COVID policy. The firm’s asset growth for the period ending December 2021 was 13%. 

According to The Guardian, Cummings personally emailed a senior civil servant in order to push through the awarding of a £580,000 contract. Hanbury was co-founded by Vote Leave communications director Paul Stephenson. Cummings was the campaign manager of Vote Leave.

At least three former employees of Hanbury are now advising Liz Truss, alongside former Public First director Alex Wild. Their positions see them working alongside a host of other alumni from Crosby’s CT Group, as well as those drawn from the ranks of Tufton Street think-tanks.

MDS Healthcare was another firm awarded PPE contracts, worth some £2.5 million. The firm donated £5,000 to the Conservatives in July 2020, shortly after being awarded the work, though the company maintains that the donation was unrelated to its work during the pandemic. MDS increased its assets from £1.9 million to £3.3 million during its latest accounting period.

As Byline Times has recently revealed, the group of companies associated with P14 Medical – that won £276 million in PPE deals during the pandemic – has logged financial gains in the region of £9.9 million. P14 Medical is co-owned by Steve Dechan, a former Conservative councillor, who donated £7,500 to his local party in October 2020.