Coronavirus: Lucrative government contracts handed to Conservative ‘friends’, Labour alleges

Labour has accused the government of handing out lucrative Covid-19 contracts to Conservative friends and warned that equipment has not been delivered.

Ministers were urged to explain how deals worth “more than £830m have been awarded to at least 12 different companies” for personal protective equipment (PPE) – which has “never materialised”.

In the Commons, Labour also demanded answers over a contract handed – “without any public tender process” – to Public First, a company run by a former aide to Michael Gove and associate of Dominic Cummings.

It was “owned by friends of the prime minister’s most senior adviser”, Helen Hayes, a Cabinet Office spokesperson said – and “justified as part of the coronavirus response but appears to relate to Brexit”.

“The flexibility required by extraordinary circumstances is no excuse for reducing transparency or abandoning any attempt at due diligence,” Ms Hayes protested.

Penny Mordaunt, a Cabinet Office minister, did not deny that PPE had not been delivered, but insisted every MP knew a senior employee at Public First – who was a “former much-loved deputy speaker” of the Commons.

“If the honourable lady has serious concerns about these contracts, other than insinuations, there are very clear processes to go through, and I would urge her to do so,” she said.

The row comes as the government faces a court case over the awarding of emergency contracts, outside of normal rules, alleging breaches of procurement law and apparent bias to longstanding associates.

It has been launched by the Good Law Project, which instigated important legal challenges, and is crowdfunding for resources.

Controversy surrounds a £32m contract handed to a pest control company called PestFix to source surgical gowns, although it has listed net assets of only £18,000.

In legal papers the government revealed that at the start of this month, no gowns had been delivered to the NHS – almost three months after the contract was awarded.

Meanwhile, Public First was given £840,000 to assess the effectiveness of the government’s coronavirus advice, although it was also listed as being to prepare for completing Brexit.

The company is co-owned by James Frayne, who was employed by Mr Gove when he was education secretary, alongside Mr Cummings – now the prime minister’s chief aide.

Critics have protested the work was not advertised, there was no competition and that no official notice of the award has even been published.

Labour has now written to the National Audit Office asking for an investigation into the way contracts have been awarded under the emergency procedures.

“The government has published details of outsourced contracts worth around £3bn, while the true figure is likely to be many multiples of that,” said Rachel Reeves, Mr Gove’s shadow.

Asked if he supported such an inquiry, Mr Gove replied: “Absolutely.”

And defending the processes, Ms Mordaunt added: “Authorities are allowed to procure goods and services in extreme emergency situations – that doesn’t mean that scrutiny or value for money principles go out the window.”