Right, after all the Hoo-ha from Maugham and his social media campaign the first official inquiry's are starting to filter out and up to now they echo what I've been saying all along - namely no identified corruption or cronyism but mistakes and omissions have been made but saying that the reports acknowledge that vast amount of volumes and time pressure that the procurement needed to be acquired under.
The first major reporting body is the National Audit Office's - Investigation into government procurement during the COVID-19 pandemic, published today 18th November.
It doesn't paint a pretty picture but then again in hasn't been damning in it's findings either.
Let me set the scene - firstly
Who is the NAO?The National Audit Office (NAO) scrutinises public spending for Parliament and is independent of government and the civil service. It helps Parliament hold government to account and it uses its insights to help people who manage and govern public bodies improve public services.
The Comptroller and Auditor General (C&AG), Gareth Davies, is an Officer of the House of Commons and leads the NAO. The NAO audits the financial accounts of departments and other public bodies. It also examines and report on the value for money of how public money has been spent.
The Volume of work in the first six months of the pandemic -By 31 July, over 8,600 contracts, worth £18.0 billion, related to government’s response to the pandemic had been awarded. Individual contracts ranged in value from less than £100 to £410 million. 90% of the contracts by value (£16.2 billion) were awarded by the Department of Health & Social Care (DHSC) and its national bodies. In comparison, in 2019-20 DHSC awarded 174 contracts worth £1.1 billion, less than 7% of what it and its national bodies awarded between January and July 2020 in response to the pandemic.
New contracts worth £17.3 billion were awarded to suppliers, of which: £10.5 billion were awarded directly without a competitive tender process;1 £6.7 billion were awarded directly through pre-existing framework agreements (which would have involved a competitive bidding process when they were set up); and contracts worth almost £0.2 billion were awarded using a competitive tender process or using a competitive bidding process from a framework agreement. Government also procured goods and services worth £0.7 billion through amendments or extensions to existing contracts.
Personal protective equipment (PPE) accounted for 80% of the number of contracts awarded (over 6,900 contracts) and 68% of the total value of contracts awarded (£12.3 billion). PPE needed to be procured quickly during the first few months of the pandemic, when global demand far exceeded supply.
How did the set up to do this? -The Department of Health and Social care (DHSC), supported by other departments, established an eight-stage process to assess and process offers of support to supply PPE.
It set up processes to rapidly check suppliers’ equipment against government’s PPE specifications and to undertake due diligence on the suppliers. Contracts were awarded to 71 suppliers, worth £1.5 billion in total, before this process was standardised; 62 of these have been delivered, three have been cancelled and six remain ongoing.
The High Priority Lane -The cross-government PPE team
established a high-priority lane to assess and process potential PPE leads referred by government officials, ministers’ offices, MPs and Lords, senior NHS staff and other health professionals. The team considered that leads referred by these sources were more credible or needed to be treated with more urgency. About one in ten suppliers processed through the high-priority lane (47 out of 493) obtained contracts compared to less than one in a hundred suppliers that came through the ordinary lane (104 of 14,892).The sources of the referrals to the high-priority lane were not always documented in the case management system and the NAO found a case where a supplier, PestFix, was added to the high-priority lane in error.
Accountability and scrutiny of contracts awarded -For procurements where there is no competition, it is important that awarding bodies set out clearly why they have chosen a particular supplier and how any associated risks from a lack of competition have been identified and mitigated. This is to ensure public trust in the fairness of the procurement process.
In a selected sample of 20 contracts, the NAO found examples where departments failed to document key decisions, such as why they chose a particular supplier or used emergency procurement, and failed to document their consideration of risks, including how they had identified and managed any potential conflicts of interest.
The NAO found that some contracts were awarded retrospectively after work had already been carried out. For example, a £3.2 million contract was awarded to Deloitte to support the cross-government PPE team’s procurement of PPE on 21 July 2020, with the contract effective from 14 March 2020. The Cabinet Office’s contract with Public First was awarded on 5 June 2020, with the contract effective from 3 March 2020.
By asking for work to be delivered without a formal contract, risks such as underperformance are increased.Why those 20 contracts were looked at - The NAO selected this sample on a risk basis, considering factors such as concerns raised (for example, by correspondents or the media), as well as the size of contracts and the complexity of their subject matter.
Findings - On the 20 contracts inspected - For a Cabinet Office procurement for focus groups and communications with Public First, the Cabinet Office failed to document why it chose this particular supplier, why it used emergency procurement and failed to document any consideration of any potential conflicts of interest. For three government contracts for data services with Faculty, the awarding bodies failed to document any consideration of any potential conflicts of interest in two cases and in one case failed to document why the supplier was chosen. For a DHSC contract for PPE with Ayanda, DHSC failed to consider a potential conflict of interest for a person associated with the company.
Also - a separate inquiry into the allegations from Mangham was on going namely -
The Cabinet Office asked the Government Internal Audit Agency to review six PPE contracts that have attracted media attention. The review found that while there was evidence for most controls being applied, there were some gaps in the documentation, such as why some suppliers which had low due diligence ratings were awarded contracts.Reporting and Transparency -Many of the contracts awarded over this period have not been published in a timely manner. Guidance issued by the Crown Commercial Service recommends that basic information about the award of all contracts is published within 90 days of the award. Of the 1,644 contracts worth more than £25,000 awarded up to the end of July 2020, 55% had not had details published on Contracts Finder by 10 November 2020 and only 25% were published within the 90-day target. For contracts of a higher value which are required to be published to the Official Journal of the European Union, DHSC published 89% of 871 contracts. Transparency is a key control to ensure accountability for decisions taken.
Recommendations -The NAO recommends that, should the need to procure significant volumes of goods with extreme urgency arise again, government identifies and manages potential conflicts of interest and bias earlier in the procurement process. Government should ensure that basic information on contracts are published within 90 days of award.
Concluding Remarks - In the months following the emergence of the COVID-19 pandemic in March 2020 in the UK, government awarded around £18 billion of contracts using emergency procurement regulations to buy goods, services and works to support its response to the pandemic. Government was having to work at pace, with no experience of using emergency procurement on such a scale before and was developing its approach at the same time as procuring large quantities of goods and services quickly, frequently from suppliers it had not previously worked with, in a highly competitive international market. This procurement activity secured unprecedented volumes of essential supplies necessary to protect front-line workers. Our separate report on the supply of PPE looks in detail at the extent to which demand for that equipment was met and the value-for-money achieved.
At the start of the COVID-19 pandemic in the UK, government had to procure large volumes of goods and services quickly whilst managing the increased risks this might entail. While government had the necessary legal framework in place to award contracts directly, it had to balance the need to procure large volumes of goods and services quickly, with the increased commercial and propriety risks associated with emergency procurement. We looked in detail at a sample of contracts selected on a risk basis. Although we found sufficient documentation for a number of procurements in our sample, we also found specific examples where there is insufficient documentation on key decisions, or how risks such as perceived or actual conflicts of interest have been identified or managed. In addition, a number of contracts were awarded retrospectively, or have not
been published in a timely manner. This has diminished public transparency, and the lack of adequate documentation means we cannot give assurance that government has adequately mitigated the increased risks arising from emergency procurement or applied appropriate commercial practices in all cases. While we recognise that these were exceptional circumstances, it remains essential that decisions are properly documented and made transparent if government is to maintain public trust that taxpayers’ money is being spent appropriately and fairly. The evidence set out in our report shows that these standards of transparency and documentation were not consistently met in the first phase of the pandemic.
Gareth Davies, head of the NAO
https://www.nao.org.uk/press-release/investigation-into-government-procurement-during-the-covid-19-pandemic/https://www.nao.org.uk/wp-content/uploads/2020/11/Investigation-into-government-procurement-during-the-COVID-19-pandemic-Summary.pdfAlso from the report -
The NAO concluded that in cases of potential conflicts of interest involving ministers, all had properly declared their interests and it found "no evidence of their involvement in procurement decisions or contract management".
The spending watchdog acknowledged the pandemic required acting with "extreme urgency" and the Public Contracts Regulations allowed an emergency response, including awarding deals directly without a formal competition.Cabinet Office Minister Julia Lopez said: "We have been dealing with an unprecedented global pandemic that has posed the biggest challenge to the UK in a generation.
"As this report rightly recognises, we needed to procure contracts with extreme urgency to secure the vital supplies required to protect frontline NHS workers and the public and we make no apology for that.
"We have robust processes in place for spending public money to ensure we get critical equipment to where it needs to go as quickly as possible, whilst also ensuring value for money for the taxpayer.
"It is important to maintain the public's confidence in how we manage their money, and we welcome the NAO's scrutiny of our processes and recommendations on how they can be improved."
https://www.bbc.co.uk/news/business-54978460So in summary huge volume of work due to worldwide pandemic resulting in emergency procurement and innovative priority system structure set up that has delivered the required volumes of PPE's within time to stop the NHS falling over, based on 'leads' from more 'creditable' sources, were not all the required paperwork and reporting of awards were done completely or on time.
No reporting however of corruption or cronyism being found on any of the specific contracts raised by Mangham or those selected for scrutiny by the NAO.
If I may say so, just as I had been saying all along.
However PAC to come in a fortnight and that may unearth a skeleton or two but I'll stick to what I've been saying since March, namely mistakes and omissions will have inevitably have been made considering the uniqueness and urgency of the world situation but I would be really surprised if there is any cronyism or corruption found.
We'll see though.