Skip to main content

Government Contracts: Covid-19

Volume 681: debated on Thursday 1 October 2020

What assessment he has made of the adequacy of (a) supplier performance and (b) value for money achieved under Government contracts issued in response to the covid-19 outbreak. (906877)

What assessment he has made of the adequacy of (a) supplier performance and (b) value for money achieved under Government contracts issued in response to the covid-19 outbreak. (906878)

What assessment he has made of the adequacy of (a) supplier performance and (b) value for money achieved under Government contracts established in response to the covid-19 outbreak. (906888)

The private sector has played a vital role in the Government’s response to the covid-19 outbreak, such as delivering over 15,000 ventilators in under four months to support the NHS and changing production facilities so that by December we expect that UK manufacturers will be meeting 70% of the demand for personal protective equipment, compared with just 1% before the pandemic. Being able to procure at speed has been critical in providing that response. However, we have been clear that all contracts, including those designed to help tackle coronavirus, must continue to offer quality public services and achieve value for money for taxpayers.

The Minister’s response says more about the Government’s failure to implement the recommendations of Operation Cygnus than it does about their ability to implement an effective response to the pandemic. The Government have bypassed the NHS, outsourcing billions of pounds-worth of contracts in back-room deals with their mates that then failed to deliver—failed to deliver PPE that fits on time, failed to deliver the testing capacity that is needed and failed to deliver a national tracing programme that contacts everyone affected. The Government’s actions are not just incompetent; their failure to comply with transparency obligations is potentially unlawful. Therefore, will they stop wasting more taxpayers’ money defending the indefensible and provide my lawyers with the information on these contracts that my co-complainants and I have requested?

The DHSC has procured over 32 billion items from UK-based manufacturers and international partners—an incredibly difficult task at an incredibly difficult time. We received over 24,000 offers of help from 15,000 individual suppliers, and all were prioritised according to volume, price, clinical acceptability and lead time, meaning the time from an offer being accepted by the DHSC to a supplier delivering the items. Of course I am happy to look into any offer of help from a business that was found wanting, but I refer the hon. Member to the view outlined by the Chair of the Public Accounts Committee, the hon. Member for Hackney South and Shoreditch (Meg Hillier), who praised the Department’s response to procurement.

Track and trace services, when led by experienced public health teams, have been more effective, and at lower cost, than the outsourced system in NHS England. In Wales, the contact rate for track and trace is over 90%, whereas in England, it hovers at a little over 70%. When will the Government recognise the importance of value for money and redirect their multimillion-pound procurement towards long-established local health networks?

It has been an extremely challenging time, as I have said, and the private sector has been a valuable partner in everything we have done. The contracts awarded have been extremely valuable in ensuring that we can deliver capacity at pace. If the hon. Lady has any concerns, I am happy to look into them.

The Minister will be aware that the Competition and Markets Authority is now investigating the proposed merger of two outsourcing giants in the facilities management industry: Mitie and Interserve. Given that both companies hold Government contracts worth over £2 billion, what steps is she taking to review the implications of the merger, considering the clear risk to public funds, as well as to the terms and conditions and future employment of over 80,000 workers?

I am afraid that the Competition and Markets Authority is not within my remit, but I am happy to look into any concerns, because contracts and procurement performance are within my remit, and I want to ensure that we receive value for money for the taxpayer in everything we do.

I understand that the Government’s contract with Sitel for test and trace is renewed on an eight-week basis, with a two-week notice period. The next deadline for renewal is this Sunday, 4 October. Will the Minister publish all the renewal dates for Sitel and Serco’s contracts, and will she explain what justification the Government could possibly have for continuing with the failed privatised, centralised model of test and trace, by contrast to the effectiveness of local councils and public health teams, who are denied the full funding that they require?

As I have said, without the private sector, we would have struggled to deliver the testing capacity that we now have. Serco and Sitel are approved suppliers on the Crown Commercial Service’s contact centre framework, and they gain their places through fair and open competition via Official Journal of the European Union procurement. Value for money and capability were part of the assessment criteria. But if there are other suppliers that would bid well for the contracts, we are happy to look into that.

Government spending on consultants has risen sharply in recent years, up by around £1 billion since 2016, with contracts worth at least £56 million awarded without competitive tender during the covid crisis. Does the Minister agree with her colleague Lord Agnew that the Government are reliant on consultants who are providing poor value for money because of their vastly inflated cost when carrying out services that could be conducted more efficiently in-house? If so, can she tell the House when the review into current controls and spending limits will begin, and when it will report?

Consultants play an important role in what the Government try to achieve on particular projects, but the hon. Lady is right: we have concerns about the cost of those consultants and whether we are too reliant on them, and we are actively reviewing that. I am working with my colleague Minister Agnew on these matters.