A company linked to Tory peer Michelle Mone has been ordered to pay the government almost £122m for breaching a contract to supply millions of surgical gowns during the Covid-19 pandemic.
The Department of Health and Social Care (DHSC) sued PPE Medpro at the High Court, claiming the company had breached the deal because the 25 million gowns it provided were “faulty” by not being sterile.
The company, a consortium led by Lady Mone’s husband, businessman Doug Barrowman, was awarded government contracts by the former Conservative administration to supply PPE during the pandemic, after she recommended it to ministers.
She then acted as the firm’s “big gun” in talks with officials to help get the contract over the line, High Court judge Mrs Justice Cockerill said on Wednesday.
In her 87-page ruling, Mrs Justice Cockerill said the gowns “were not, contractually speaking, sterile, or properly validated as being sterile” which meant they could not be used in the NHS.
The ruling was celebrated by ministers, including health secretary Wes Streeting, who said the government was “coming after every penny owed to our NHS” as part of a plan to claw back money lost during the pandemic.
Families bereaved in the pandemic also welcomed the judgement and called for Baroness Mone to be stripped of her peerage.
But Baroness Mone said the ruling was a win for the “establishment”, while Mr Barrowman said it was a “travesty of justice”.
Both denied wrongdoing and neither gave evidence at the trial in June, while lawyers for the DHSC said they were “not concerned with any profits made by anybody” and that the case was “simply about compliance”.
The government is now recovering the cost of the £121m contract, as well as the costs of transporting and storing the items, which amount to an additional £8.6m.
Court documents from May reveal the DHSC said the gowns were delivered to the UK in 72 shipments between August and October 2020, with £121,999,219.20 paid to PPE Medpro between July and August that year.
In December 2020, the gowns were rejected by DHSC and the company was told it would need to repay the money. But the company did not, and the gowns remained in storage unable to be used.
During the trial, Paul Stanley KC, for the DHSC, said 99.9999 per cent of the gowns should have been sterile under the terms of the contract.
The DHSC claims the contract also specified PPE Medpro had to sterilise the gowns using a “validated process”; this included a CE marking to show it met certain medical standards.
However, according to Mr Stanley, “none of this happened”, and out of the 140 gowns later tested for sterility, 103 failed the test.
Charles Samek KC, for PPE Medpro, said at the close of the trial that the government had ordered 10 years’ worth of excess gowns by December 2020 and that it was suffering from “buyer’s remorse”.
He said the DHSC approved the gowns without seeing a valid CE mark and that PPE Medpro “did not pretend” to have one because it did not need it.
After delivery, the gowns were kept in shipping containers for “at least three months”, he added, and that contamination likely occurred “most probably during the subsequent transportation, storage and handling of the tested gowns”.
Chancellor Rachel Reeves, who has been leading work within government to claw back money lost during the Covid-19 pandemic, welcomed the judgment.
She said: “We want our money back. We are getting our money back. And it will go where it belongs – in our schools, NHS and communities.”
Health Secretary Wes Streeting said: “PPE Medpro put NHS staff and patients in danger with substandard kit whilst lining their own pockets with taxpayers’ money at a time of national crisis.
“Today’s court ruling makes clear we won’t stand for it and we’re coming after every penny owed to our NHS.
“This Government will ruthlessly pursue any company which tried to exploit the pandemic for their own ends while our health service was fighting to save lives.”
In a written statement, Mr Barrowman, a businessman who led the consortium, said: “Today, a travesty of justice took place following the judgment of Lady Justice Cockerill.
“She gave the DHSC an establishment win despite the mountain of evidence in court against such a judgment.
“Her judgment bears little resemblance to what actually took place during the month-long trial, where PPE Medpro convincingly demonstrated that its gowns were sterile.
“This judgment is a whitewash of the facts and shows that justice was being seen to be done, where the outcome was always certain for the DHSC and the government. This case was simply too big for the government to lose.”
The Covid-19 Bereaved Families for Justice UK campaign group said: “Our families welcome today’s ruling, but this is just the tip of the iceberg. Greed and corruption during the pandemic have cost lives, and everyone responsible must be held accountable.”
They said the creation of a so-called VIP lane led to billions being spent on inadequate PPE, adding: “That failure cost lives. We want justice for those who died as a result.
“The UK Covid-19 Inquiry has so far concluded just one of its 10 modules. As it continues, the scale of the corruption, greed, misconduct and incompetence uncovered in its reports will shock the country.
“Nobody who had any part to play in the PPE scandal, which cost lives, should have any role in public life. Baroness Mone should have no role in making and passing the laws we all live under. Her title must be revoked immediately.”
