Corrupt COVID Contracts: Red flags raised around potential government contract bias

May 2, 2021

3 min read

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What's going on here?

20% of UK COVID contracts worth £3.7bn have raised concerns regarding possible corruption, as lucrative coronavirus deals have been awarded in favour of companies with political connections to the Conservative Party.

What does this mean?

Suspicions have been raised that profitable contracts, using taxpayer money, were awarded to friends and acquaintances of the Conservative Party during the coronavirus pandemic. Despite denial from ministers and civil servants, an analysis by well-respected campaign group, Transparency International UK, suggested systemic bias in the award of these deals. Following a review of nearly 1,000 contracts worth £18bn, the group found that between February and November 2020, 98.9% were awarded without any form of competition, while 27 contracts, worth a staggering £2.6bn, were granted to companies with links to Tory MPs.

This issue was first noticed back in November 2020 by the National Audit Office, which discovered that those with political ties were ten times more likely to succeed in securing contracts, due to referral into the ‘VIP lane’, which was essentially a fast-track. The government claimed its creation was to help narrow down the large numbers of offers that the government had been inundated with, as a result of the global rush for PPE, which saw prices quickly skyrocket. However, some feared that it was being used to disburse public money to friends, particularly as the government refused to disclose the name of companies who were part of the scheme.

As a result, an urgent further investigation is needed in order to determine whether corruption has occurred.

What's the big picture effect?

There is no doubt that the past year has been difficult for the UK, and many people have put their trust in the government to guide us through the pandemic. However, the idea that MPs have potentially been awarding contracts based not on what’s best for the country, but to line the pockets of friends, has the potential to seriously damage confidence in the government’s integrity regarding the pandemic response.

On top of this, it undermines the government’s commitment to having ‘robust processes in place for spending public money’ and ‘ensuring value for money for the taxpayer’. However, Transparency International identifies some unexplainable patterns, particularly with the creation of the VIP lane. For example, £225m had been granted to companies who had only been incorporated in the last 60 days, suggesting that they could not have a track record of successful business, and may have been awarded without competitive tender. This also undermines government claims that chosen businesses had undergone a legitimate selection process.

This is also not the first time issues have been raised surrounding these COVID contracts. In February, following pressure from the Labour party, the High Court concluded that the Health Secretary, Matt Hancock, had acted unlawfully in failing to publish COVID contracts within 30 days, which was considered a transparency breach.

Transparency International’s Chief Executive, Daniel Bruce, stated that the government “has serious questions to answer”, particularly due to rising suspicions as a result of their reluctance to being open. The Conservatives have now been urged to publish the names of businesses awarded contracts through VIP lane, and be more transparent about how over £2bn of taxpayer money has been spent. However, if the investigation ultimately finds that corruption has taken place, the government may have to put in some serious work to gain back the already wavering trust of the public, particularly as public confidence is critical right now, as we work our way through the final stages of the pandemic.

Report written by Lotanna Okaro 

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