Recommendations & Conclusions
21 items
2
Recommendation
Twelfth Report - Management of PPE cont…
Acknowledged
The Department still lacks a stock management system that enables it to fully understand what PPE it has and where it is. The Department believes that it has now received nearly all of the 37.9 billion PPE items that it has ordered, with 300 million items yet to be received. …
Government response. The government agrees with the Committee’s recommendation and the department has undertaken a review of historic ministerial diaries and has, where necessary, updated the register in line with Cabinet Office requirements; the department has strengthened both reporting and quality assurance …
HM Treasury
3
Conclusion
Twelfth Report - Management of PPE cont…
The Department remains in dispute on 176 contracts for PPE with £2.7 billion of taxpayer money at risk and has made little progress in tackling potential fraudulent supplies of goods. The majority of these 176 disputes relate to the quality of the PPE provided by the supplier. Eighty-three of the …
Government response. 3: PAC conclusion: The Department remains in dispute on 176 contracts for PPE with £2.7 billion of taxpayer money at risk and has made little progress in tackling potential fraudulent supplies of goods. 3a: PAC recommendation: The Department should explain …
HM Treasury
4
Recommendation
Twelfth Report - Management of PPE cont…
The Department had insufficient due diligence checks at the outset of the pandemic to prevent potential profiteering and to identify conflicts of interest. We recognise that the Department had to act quickly at the start of the pandemic to secure vital supplies of PPE but believe that there was still …
Government response. 4: PAC conclusion: The Department had insufficient due diligence checks at the outset of the pandemic to prevent potential profiteering and to identify conflicts of interest. 4: PAC recommendation: The Department should set out in its Treasury Minute response how …
HM Treasury
5
Recommendation
Twelfth Report - Management of PPE cont…
Accepted
The Department has handed back responsibility for the PPE programme to Supply Chain Coordination Limited (SCCL) with many issues still to be resolved. Since October 2021, oversight of SCCL transferred from the Department to NHS England and in April 2022 the Department transferred the responsibility for managing the supply of …
Government response. The government agreed to release its PPE strategy and update the Committee on plans for publication, aiming for Autumn 2022 implementation, while the NHS Supply Chain took over PPE supply and distribution in April 2022.
HM Treasury
6
Recommendation
Twelfth Report - Management of PPE cont…
Accepted
The future of the UK-based supply chain for PPE is unclear. The global demand for PPE at the start of the pandemic pushed up the prices from suppliers around the world. In an effort to create a more resilient UK-based supply chain, the Department encouraged some UK manufacturers to repurpose …
Government response. The department has established a resilient UK-based supply chain and contracts have been signed with around 30 UK-based companies. The department is working with NHS Supply Chain to help offer UK manufactured products to the health and care sectors where …
HM Treasury
1
Conclusion
Twelfth Report - Management of PPE cont…
On the basis of a Report by the Comptroller and Auditor General, we took evidence from the Department of Health & Social Care (the Department) about its management of Personal Protective Equipment (PPE) contracts let during the COVID-19 pandemic.1
Government response. Based on a report by the National Audit Office, the Committee took evidence on 20 April 2022 from the Department of Health and Social Care. The Committee published its report on 20 July 2022. This is the government’s response to …
HM Treasury
7
Conclusion
Twelfth Report - Management of PPE cont…
Accepted
Alongside reducing excess stock, the Department is also having to consider what is an appropriate level of PPE to hold as a stockpile. We asked it whether it had created another strategic reserve of PPE in preparation for the possibility of a future pandemic.11 The Department noted that it had …
Government response. Operational responsibility will transfer to the NHS Supply Chain on 1 April 2023, with the department retaining ownership of this stock for accounting purposes. The department’s current working assumption is that, subject to suitability, products held in excess will be …
HM Treasury
8
Conclusion
Twelfth Report - Management of PPE cont…
The Department told us that it has now received nearly all of the 37.9 billion items of PPE which it ordered, with only 300 million items outstanding. It told us that whilst it has now opened every container it has received there are still 1.39 billion PPE items that have …
Government response. 2: PAC conclusion: The Department still lacks a stock management system that enables it to fully understand what PPE it has and where it is. 2: PAC recommendation: The Department should set out in its Treasury Minute response to the …
HM Treasury
9
Conclusion
Twelfth Report - Management of PPE cont…
We asked what assurances the Department could give us about the accuracy of its stock numbers. This was because the NAO reported that it could not fully reconcile the numbers from the stock model with individual contracts and said it was therefore unable to gain assurance over the accuracy of …
Government response. 2: PAC conclusion: The Department still lacks a stock management system that enables it to fully understand what PPE it has and where it is. 2: PAC recommendation: The Department should set out in its Treasury Minute response to the …
HM Treasury
10
Conclusion
Twelfth Report - Management of PPE cont…
We asked the Department, given this wide spread of PPE storage, what steps it is taking to introduce a modern stock management system for the PPE programme.23 We noted the importance of having a system where it knows exactly how much PPE it holds, where it is and what the …
Government response. 2: PAC conclusion: The Department still lacks a stock management system that enables it to fully understand what PPE it has and where it is. 2: PAC recommendation: The Department should set out in its Treasury Minute response to the …
HM Treasury
11
Conclusion
Twelfth Report - Management of PPE cont…
The Department acknowledges that it still has many PPE contracts that have ongoing contractual issues that need resolving. There are 176 contracts where there are concerns about either the quality or the performance of the contract and these are collectively worth £3.9 billion.27 The Department has assessed that of that …
Government response. 3: PAC conclusion: The Department remains in dispute on 176 contracts for PPE with £2.7 billion of taxpayer money at risk and has made little progress in tackling potential fraudulent supplies of goods. 3a: PAC recommendation: The Department should explain …
HM Treasury
12
Conclusion
Twelfth Report - Management of PPE cont…
The NAO reported that of the 176 contracts in dispute, most of these were still in the early stages of being resolved. Eighty-three of the 176 contracts are still in the first stage of the commercial resolution process with a further 59 having entered formal commercial discussions. At present, no …
Government response. 3: PAC conclusion: The Department remains in dispute on 176 contracts for PPE with £2.7 billion of taxpayer money at risk and has made little progress in tackling potential fraudulent supplies of goods. 3a: PAC recommendation: The Department should explain …
HM Treasury
13
Conclusion
Twelfth Report - Management of PPE cont…
We asked the Department what its assessment of fraud was amongst these contractual disputes. Although it conceded that some of the 176 contracts were of interest from a fraud perspective it was unwilling to give much information about any specific work it was undertaking beyond stating that it was working …
Government response. 3: PAC conclusion: The Department remains in dispute on 176 contracts for PPE with £2.7 billion of taxpayer money at risk and has made little progress in tackling potential fraudulent supplies of goods. 3b: PAC recommendation: The Department should also …
HM Treasury
14
Conclusion
Twelfth Report - Management of PPE cont…
We wanted to understand the Department’s view of profits made by PPE suppliers and intermediaries, particularly on contracts that have failed to deliver adequate PPE, many of which came through the VIP referral route. Reports continue to emerge of the vast profits that some individuals and companies made through supplying …
Government response. 4: PAC conclusion: The Department had insufficient due diligence checks at the outset of the pandemic to prevent potential profiteering and to identify conflicts of interest. 4: PAC recommendation: The Department should set out in its Treasury Minute response how …
HM Treasury
15
Conclusion
Twelfth Report - Management of PPE cont…
Acknowledged
The Department told us that factoring in consideration of profit margins before these PPE contracts were awarded was not possible. While it agreed that the best way to mitigate against excessive profiteering was to build such contingencies into the contract it argued that the reality of the global market at …
Government response. The government agrees with the Committee’s recommendation and is implementing a commercial reset to prevent issues with due diligence and conflicts of interest from occurring again in the future.
HM Treasury
16
Conclusion
Twelfth Report - Management of PPE cont…
One due diligence check that did not appear to be applied was a consideration of potential conflicts of interest on PPE referrals. The Department confirmed that when signing off on these PPE contracts the accounting officer did not normally have any information about the source of the referral.47 It also …
Government response. 4: PAC conclusion: The Department had insufficient due diligence checks at the outset of the pandemic to prevent potential profiteering and to identify conflicts of interest. 4: PAC recommendation: The Department should set out in its Treasury Minute response how …
HM Treasury
17
Conclusion
Twelfth Report - Management of PPE cont…
Prior to the pandemic, the role of procuring and managing PPE was largely the responsibility of Supply Chain Co-ordination Limited.50 In March 2020, when the Department realised that SCCL alone would not be able to procure the volume of PPE required, the Department took a more central role in PPE …
Government response. 5: PAC conclusion: The Department has handed back responsibility for the PPE programme to Supply Chain Coordination Limited (SCCL) with many issues still to be resolved. 5: PAC recommendation: The Department should release its PPE strategy in full as soon …
HM Treasury
18
Conclusion
Twelfth Report - Management of PPE cont…
We asked the Department how the transfer back to SCCL had gone and it was very positive about the process. It said that nothing had really been interrupted from a logistics perspective and that the reality is that the Department and SCCL had been working “hand in glove before the …
Government response. 5: PAC conclusion: The Department has handed back responsibility for the PPE programme to Supply Chain Coordination Limited (SCCL) with many issues still to be resolved. 5: PAC recommendation: The Department should release its PPE strategy in full as soon …
HM Treasury
19
Conclusion
Twelfth Report - Management of PPE cont…
The Department will still have a role to play in the PPE programme despite this transfer back of the logistics to SCCL. We sought to clarify where exactly accountability lies across the different aspects of the programme. For example, the Department confirmed that resolving the 176 contracts in dispute will …
Government response. 3: PAC conclusion: The Department remains in dispute on 176 contracts for PPE with £2.7 billion of taxpayer money at risk and has made little progress in tackling potential fraudulent supplies of goods. 3a: PAC recommendation: The Department should explain …
HM Treasury
20
Conclusion
Twelfth Report - Management of PPE cont…
Prior to the COVID-19 pandemic there were not many businesses in the UK that specialised in producing PPE with most of it coming from overseas. The pandemic saw steep rises in global prices for PPE as demand for it surged throughout the world. As part of its initial pandemic response, …
Government response. 6: PAC conclusion: The future of the UK-based supply chain for PPE is unclear. 6: PAC recommendation: The Department should explain in its Treasury Minute response what the role of UK based suppliers of PPE is expected to be going …
HM Treasury
21
Conclusion
Twelfth Report - Management of PPE cont…
The Department set out in its initial PPE strategy its desire to build on this UK manufacturing base, reiterating the role it should play in building a more resilient supply chain and also the wider benefits including job creation and making the UK a centre for innovative products.66 It is …
Government response. 6: PAC conclusion: The future of the UK-based supply chain for PPE is unclear. 6: PAC recommendation: The Department should explain in its Treasury Minute response what the role of UK based suppliers of PPE is expected to be going …
HM Treasury