Recommendations & Conclusions
7 items
2
Recommendation
Sixth Report - Department of Health and…
Not Addressed
The procurement of PPE in response to the COVID-19 pandemic overwhelmed existing systems and has exposed weaknesses in the Department’s commercial contracting capability. At the start of the pandemic the Department faced significant challenges in sourcing and procuring PPE in the competitive global market due to the surge in demand …
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The procurement of PPE in response to the COVID-19 pandemic overwhelmed existing systems and has exposed weaknesses in the Department’s commercial contracting capability. At the start of the pandemic the Department faced significant challenges in sourcing and procuring PPE in the competitive global market due to the surge in demand around the world; and the temporary decline in global supply as factories temporarily shut to help reduce Covid-19 infections. PPE was purchased from new suppliers including from companies with no experience in these types of products, and where full physical product quality inspection could not always be done in advance. The Department’s subsequent review of the 364 PPE contracts it entered into identified concerns about 176 (48%) contracts. Of these 176 contracts, 24% are either currently under commercial negotiation (59 contracts); legal review (27 contracts); or in mediation (3 contracts). One of these contracts was for 3.5 billion gloves where there are allegations of modern slavery against the manufacturer. Recommendation: In its Treasury Minute response the Department should set out its ‘commercial reset’ plan and the timeline for scaling up its commercial capability across the Departmental Group to ensure sufficient support is in place to procure and manage existing and future contracts. The Department should also 6 Department of Health and Social Care 2020–21 Annual Report and Accounts keep us informed of cases where it is has been both successful and unsuccessful in reclaiming money spent on sub-standard PPE or recovering money paid to suppliers where no goods were received.
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Government response AI summary
The response does not address the recommendation of outlining a 'commercial reset' plan and timeline for scaling up commercial capability, and instead discusses internal performance measures and consultations with the sector.
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HM Treasury
1
Conclusion
Sixth Report - Department of Health and…
Not Addressed
On the basis of a report by the Comptroller and Auditor General (C&AG), we took evidence from the Department of Health and Social Care (the Department) on its Annual Report and Accounts for 2020–21.1
HM Treasury
11
Conclusion
Sixth Report - Department of Health and…
Not Addressed
Most of the PPE was bought at speed early in the pandemic. This was at a time when there was a surge in demand in other countries, and at the same time as a temporary decline in global supply as factories temporarily shut to help reduce COVID-19 infections. This resulted …
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Most of the PPE was bought at speed early in the pandemic. This was at a time when there was a surge in demand in other countries, and at the same time as a temporary decline in global supply as factories temporarily shut to help reduce COVID-19 infections. This resulted in an extremely overheated global market; a ‘sellers’ market’, with customers competing against each other, pushing up prices, and buying huge volumes of PPE often from suppliers that were new to the PPE market. In order to meet the urgent demand, the Department adapted its normal procurement and inventory management controls. This has contributed to a significant loss of value to the taxpayer and left the Department open to the risk of fraud.23
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HM Treasury
17
Conclusion
Sixth Report - Department of Health and…
Not Addressed
The Department said that in addition to holding a much larger stockpile, another alternate strategy it could have previously adopted was to buy British and therefore creating a resilient, flexible PPE manufacturing industry in this country, rather than buying from abroad. It advised us that its future plans for a …
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The Department said that in addition to holding a much larger stockpile, another alternate strategy it could have previously adopted was to buy British and therefore creating a resilient, flexible PPE manufacturing industry in this country, rather than buying from abroad. It advised us that its future plans for a more resilient supply chain did include using British manufacturers to reduce dependence on international supply chains.32 The Department acknowledged it is essential that work is undertaken to establish a cost- effective approach for buying and holding appropriate levels of PPE.33 This will need to strike the right balance between ensuring the Department has sufficient quantities of PPE 26 Qq 54, 55, 59 27 Qq 32, 37 28 Q 88 29 Q 88 30 Q 47 31 Qq 48–52 32 Q 16 33 Q 48–49 Department of Health and Social Care 2020–21 Annual Report and Accounts 13 to protect the workforce in any future pandemic or from any variant of concern; and avoids paying for PPE at the top of the market, against holding PPE that incurs ongoing storage costs and expires if not used before it degrades. 14 Department of Health and Social Care 2020–21 Annual Report and Accounts 2 Accountability and future plans Proper use of public money
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Government response AI summary
The Department said that in addition to holding a much larger stockpile, another alternate strategy it could have previously adopted was to buy British and therefore creating a resilient, flexible PPE manufacturing industry in this country, rather than buying from abroad.
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HM Treasury
29
Conclusion
Sixth Report - Department of Health and…
On 21 February 2022 the Prime Minister outlined the Government’s strategy for living with COVID-19 including the scaling back of testing, tracing and isolation.54 The Government’s intention is to put an end to the free supply of lateral flow testing kits. We asked the Department on its assessment of the …
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On 21 February 2022 the Prime Minister outlined the Government’s strategy for living with COVID-19 including the scaling back of testing, tracing and isolation.54 The Government’s intention is to put an end to the free supply of lateral flow testing kits. We asked the Department on its assessment of the number of lateral flow tests that people 46 Q 170 47 DHSC 2020–21 ARA, page 133 48 Report by the Comptroller and Auditor General, NHS England Annual Report and Accounts 2020–21, 31 January 2022 49 Q 143 50 Q 146 51 Letter from Department of Health and Social Care to Public Accounts Committee, dated 22 March 2022 52 DHSC 2020–21 ARA, pages 5, 75 53 Q 116; Letter from Department of Health and Social Care to Public Accounts Committee, dated 22 March 2022 54 Hansard: Living with Covid-19 Volume 709: debated on Monday 21 February 2022 Department of Health and Social Care 2020–21 Annual Report and Accounts 17 were carrying out on 7 March 2022, when we took evidence, and its assessment of how many they would continue to do when they have to pay for tests.55 In written evidence after the session the Department told us that 3.4 million lateral flow tests, including 0.3 million positive tests, were reported in the week 3–9 March 2022. The Department will continue to provide testing for some high-risk groups and expects some individuals and employers to buy tests privately to manage their own risk. It stated, therefore the number of tests taken is likely to be significantly higher than the number of tests paid for by the Government.56 The Department told us a detailed testing strategy would be published but did not know when this would happen, however, it will make an announcement shortly about eligibility for free tests.57
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HM Treasury
32
Conclusion
Sixth Report - Department of Health and…
At the time of our evidence session, one NHS Trust, University Hospitals of Leicester NHS Trust (UHL), had yet to publish its 2019–20 or 2020–21 Annual Report and Accounts. The C&AG reported last year that as a result of the issues identified by its auditor, UHL’s management were not prepared …
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At the time of our evidence session, one NHS Trust, University Hospitals of Leicester NHS Trust (UHL), had yet to publish its 2019–20 or 2020–21 Annual Report and Accounts. The C&AG reported last year that as a result of the issues identified by its auditor, UHL’s management were not prepared to sign the 2019–20 financial statements as ‘true and fair’ and the auditor was of the view that the financial statements were not ‘true and fair’.62 UHL’s management had planned to prepare a new set of 2019–20 financial statements to be audited by March 2021, however when we took evidence from the Department on 7 55 Q 1 56 Letter from Department of Health and Social Care to Public Accounts Committee, dated 22 March 2022 57 Q 6; Letter from Department of Health and Social Care to Public Accounts Committee, dated 22 March 2022 58 Q 118 59 Qq 120–121 60 Letter from Department of Health and Social Care to Public Accounts Committee, dated 22 March 2022 61 Q 107 62 C&AG’s Report, paras 29 and 30 18 Department of Health and Social Care 2020–21 Annual Report and Accounts March 2022, UHL was yet to sign and publish its financial statements for both 2019–20 and 2020–21. For a second year in a row, it failed to comply with the Secretary of State’s directions to prepare ‘true and fair’ accounts.63
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HM Treasury
33
Conclusion
Sixth Report - Department of Health and…
Not Addressed
We asked the Department what it was doing to assure itself that the situation at UHL would be resolved and whether it was an isolated occurrence or indicative of similar issues that may surface elsewhere in the NHS in the future. The Department acknowledged the fact that annual report and …
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We asked the Department what it was doing to assure itself that the situation at UHL would be resolved and whether it was an isolated occurrence or indicative of similar issues that may surface elsewhere in the NHS in the future. The Department acknowledged the fact that annual report and accounts had not been published for 2019–20 or 2020–21 was a serious issue. It told us the Trust entered special measures in August 2020 and NHS Improvement is working intensively with UHL, with national and regional leads working together with the Trust, to resolve the governance and control weaknesses. The Department said it was not aware of any other Trusts with similar problems, and that any issues would be identified by NHS Improvement through its oversight framework.64 63 Qq 111, 113 64 Q 111 Department of Health and Social Care 2020–21 Annual Report and Accounts 19
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Government response AI summary
The government response details NHS England's process for scrutinizing severance cases and contractual payments for NHS and foundation trusts, which is unrelated to the original query about resolving governance issues at UHL and systemic issues within the NHS.
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HM Treasury