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Over £520 million in PPE supplied during the COVID pandemic, that was not fit for purpose was supplied by 16 companies that are now dissolved, in liquidation, or have gone into administration, analysis of company records by Byline Times reveals.
The figure highlights the huge difficulties the new UK Government is facing trying to recoup costs from companies that supplied equipment that could never be used.
As the documents expose, the chances of recovering hundreds of millions in wasted taxpayer money remain uncertain, with most of the money mentioned in the statements as debts owed to the Department of Health and Social Care (DHSC) so far not returned.
However, the Government is in the process of taking action against some companies, with the (DHSC) forcing one among the now defunct 16 firms to be placed back on the register so they can pursue claims against them. The department declined to specify when the action began.
The amount paid to the 16 companies that are no longer operating, accounts for roughly 13% of the known amount spent on unfit PPE during the first year of the pandemic. Over 65% of the total spent, some £339 million, comes from seven companies pushed through the last Conservative Government’s so-called VIP lane of priority contracts handed to associates of MPs.
There is no evidence that the Government has been able to recover any money lost to the seven VIPs who supplied unfit PPE and who are now either dissolved or in liquidation. To-date, 3.4% of the £1 billion spent has reportedly been recovered from VIP firms more generally, many of which are still operating.
More Than a Million Pallets of Unusable Covid PPE Costing £8 Billion Have So Far Gone Up in Smoke
Billions of pounds were spent on unusable protective equipment, with priority contracts handed to associates of Conservative ministers
The £520 million does not include the £124 million spent on PPE from PPE Medpro, as the company is still active, even though Douglas Barrowman and Conservative peer Michelle Mone are under investigation by the National Crime Agency. The agency has refused to comment further as proceedings are still ongoing.
Of the liquidator statements and company records available, four directly mention DHSC as a creditor in ongoing proceedings. As recently reported by Private Eye, Excalibur Healthcare – one of the 16 companies and also one which received VIP treatment – has now folded, owing over £22 million to DHSC.
Excalibur initially received a £135 million contract to supply ventilators to the Government at £50,000 a piece in April 2020 during its “call to arms”, though after it became clear that they’d never be used, the department were stuck with a surplus of equipment. The same model ventilator was being sold under the Conservatives for as little as £100 each starting bids in December 2023.
Another company, Cannagrow Biosciences Ltd, mentions in its liquidators statement of receipts that the liquidator is aware of “19 unsecured creditors in this matter with a statement of affairs value of £25,946,915”.
The statement continues: “This sum includes the claim of the Department of Health and Social Care (DHSC) in the sum of £24,750,000. To date, five proof of debts have been received in the sum of £1,166,018’. Given that claims remain outstanding the total value of the unsecured claims remain unknown.”
CannaGrow, who were paid £33 million to supply FFP3 face masks without competition, are understood to be one company among many, behind a cumulative £600 million in COVID contracts, earmarked for investigation when the Covid Corruption Commissioner is appointed.
Documents show that another firm, Rawbridge Ltd, currently have an unsecured claim against them in respect of money owed to the DHSC. They owe £1,138,791, a claim which is under review and “relates to the attempted purchase of Personal Protective Equipment from China at the beginning of the pandemic which the Director hoped would provide cashflow whilst the Company’s usual trading activities were inhibited. The director is listed as having paid back £135,000 ‘in respect of this matter’.”
The Government is in the process of taking action against some companies that supplied PPE that were unusable in an NHS setting. In one stand-out case, DHSC has forced a dissolved company to be placed back on the register so that the claims against them can be settled.
Medicine Box, a company behind a botched £40 million deal to supply protective aprons, which later turned out to be unusable, was dissolved via compulsory strike-off in January 2024, leaving the taxpayer to foot the bill.
Medicine Box paid a pub, The Plough in Cadsden, colloquially dubbed ‘The Pub of Prime Ministers’, to source four million protective overalls. The venue, which is near the Prime Minister’s Chequers residence, was owned by Chinese infrastructure firm Sinofortone, which it shared directors with.
Company filings show that Medicine Box was restored to active status, as a result of an outstanding dispute concerning the sale of inappropriate PPE, on 11 October 2024.
A statement of restoration by court order contains revelations that: “The Secretary of State for Social Care the Claimant and a person with a potential legal claim against the above named Medicine Box’ are pursuing ‘litigation the Company seeking damages for alleged breach of contract arising out of the Company’s alleged failure to provide Personal Protective Equipment to an acceptable or usable standard’.
Seeds of Hope
The action suggests, for the first time during the PPE scandal, that the Government may be able to recover money from companies which have shut up shop after providing useless PPE.
George Havenhand, Senior Legal Researcher at Spotlight on Corruption, told Byline Times that it is “encouraging to see HMRC taking firm action on behalf of taxpayers – but concerning that action has not been taken against other companies which were wound up after supplying unusable PPE and owing money to the public purse”.
He continued: “The Government’s incoming Covid Corruption Commissioner urgently needs to turbocharge similar efforts across government to claw back as much as possible of the billions in public funds that were wasted on unusable and defective PPE.”
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A landmark report from Transparency International in September identified 135 “high-risk” COVID contracts – those with at least three red flag warning signs of corruption – worth £15.3 billion, nearly one in every three pounds spent. At least 28 contracts, worth £4.1 billion, went to those with known political connections.
A Health Department spokesperson told Byline Times that the Government has “committed to doing everything in its power to get taxpayers money back where possible”, adding: “PPE contracts will be independently assessed by the (Covid Corruption) commissioner, who will be appointed soon.”
Cannagrow and Medicine Box were approached for comment but had not responded by the time of publication. Rawbridge and Excalibur could not be reached.