The UK government has commenced legal action to recover more than £100m from the company that was awarded two large PPE contracts after the Conservative peer Michelle Mone lobbied ministers.
The claim, confirmed by the Department of Health and Social Care (DHSC), is for the full £122m paid to the company, PPE Medpro, under a contract for it to supply 25m sterile surgical gowns that was awarded in June 2020. The DHSC is also seeking to recover the costs of storing and disposing of the gowns, which its officials rejected after an inspection when they arrived at the NHS depot in Daventry.
In December 2020, the company said in a statement issued by a lawyer for its director, Anthony Page, that the gowns, and 210m face masks supplied for £80.85m under another contract, had “undoubtedly helped keep our NHS workers safe”. In fact, the gowns have never been used in the NHS.
Last month, the Guardian reported – based on leaked documents compiled by HSBC bank – that £29m originating from the profits of PPE Medpro was paid to an offshore trust whose beneficiaries, bank records indicated, were Lady Mone and her three adult children.
Mone’s husband, the Isle of Man-based financier Douglas Barrowman, was paid £70m by PPE Medpro, at least £65m of which came from the company’s profits on the two government contracts.
A lawyer for Mone told the Guardian in response: “There are a number of reasons why our client cannot comment on these issues and she is under no duty to do so.”
A lawyer who represents Barrowman and PPE Medpro said a continuing investigation limited what his clients were able to say in relation to the Guardian’s report. He added: “For the time being we are also instructed to say that there is much inaccuracy in the portrayal of the alleged ‘facts’ and a number of them are completely wrong.”
A DHSC spokesperson confirmed that legal action had started, and the claim was registered on the courts service. “We can confirm that we have commenced legal proceedings in the high court against PPE Medpro Limited for breach of contract regarding gowns delivered under a contract dated 26 June 2020. We do not comment on matters that are the subject of ongoing legal proceedings,” the spokesperson said.
Mone, 51, and Barrowman, 57, have over the past two years repeatedly insisted they had no “involvement” in PPE Medpro, and “no role” in the process through which the company was awarded its government contracts. The Guardian has previously reported how those claims seem to be at odds with documents appearing to show the couple were secretly involved in PPE Medpro’s business, and emails suggesting Mone repeatedly lobbied the government on its behalf.
PPE Medpro said in a statement that it would “rigorously” defend the legal action, saying that its gowns “passed quality inspection in China”, and it accused the DHSC of a “cynical” effort to recoup its money because it had seriously over-ordered PPE. The supply of gowns followed the “successful” supply of face masks under the first contract, the company said.
“When manufactured, the goods passed quality inspection in China and then PPE Medpro was paid in full,” it said.
The statement said the DHSC had then asked PPE Medpro to manufacture a further 2m gowns, but that contract “never materialised”.
“By the end of 2020 it was clear that DHSC has vastly over-ordered and … it was clear that the DHSC would never be able to use all the PPE they procured. Consultants were then brought in to pick over all the contracts and fight product not on quality but on contract technicalities that were never envisaged at the time of contract.
“DHSC’s cynical attempt to recover money from suppliers like PPE Medpro, who acted in good faith and to contract specifications, will be found out through the civil court process … The case will also show the utter incompetence of DHSC to correctly procure and specify PPE during the emergency procurement period.”
The DHSC declined to comment on the statement made by the company. Mone and Barrowman were separately contacted for comment.
PPE Medpro is the subject of an ongoing potential fraud investigation by the National Crime Agency. In April this year, NCA officers searched several addresses, including the mansion Mone and Barrowman occupy in the Isle of Man. At the time, lawyers for PPE Medpro declined to comment on the NCA investigation.
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