Revealed: The company given £800m of Covid PPE contracts by Government without open tender
The logistics company Uniserve is not a household name but it has received the highest total value of Covid contracts from the the Department of Health and Social Care (DHSC) without a tender.
Earlier this year, the government suspended "normal procurement and sourcing practice" in the the rush to supply the NHS with the personal protective and medical equipment (PPE) it needed.
To date, over 8,600 contacts have been awarded worth £18 billion.
The government awarded £777 million of contracts to Uniserve, a transport company based in Essex, without offering other companies the chance to bid for them.
On March 30, the DHSC awarded Uniserve a 12 month contract worth £473 million to "provide freight services for the supply of PPE and medical equipment".
The contract was prestigious - Uniserve, in effect, became DHSC’s global logistics partner - and huge. The Uniserve group recorded sales of £243 million for the whole of 2019.
Within weeks, Uniserve was not only delivering PPE for the government it was buying it and selling to government too, despite having no previous experience.
It’s easy forget that, back in March, global demand for PPE far outstripped supply.
The world descended on a few factories in China bidding for orders.
The government needed to buy quickly to support the NHS and "normal procurement" rules were abandoned.
But the scale of the contracts awarded to Uniserve without a competitive tender has raised questions about whether the DHSC achieved the best value for the taxpayer.
The government and ministers have a responsibility to deliver value for money for taxpayers, says shadow Cabinet Office Minister Rachel Reeves
"It was obviously the case you couldn't go through the normal procurement process, it would take too long but that doesn’t mean there should be a free for all and that the government should give contracts to who they want at whatever price they want," Rachel Reeves MP, the shadow Cabinet Office Minister told ITV News.
"The government and ministers have a responsibility to deliver value for money for taxpayers but also to ensure the companies that are best able to deliver get those contracts."
A Guardian and ITV News analysis of notices published via Tenders Electronic Daily (TED) − the European public procurement journal – identified Uniserve as the company that has received the highest total value of Covid contracts from DHSC without a tender.
Liz David-Barrett, professor of governance and integrity at the University of Sussex, said: "The purpose of a competitive process is to secure the best service at the best price and for the public, and other suppliers, to have confidence in it.
"Even in emergency conditions the government could run a streamlined competitive process, and an emergency should be for a short period.
"To let a really long contract under emergency provisions seems an abuse of the procedure, and puts public confidence at risk."
A government spokesman said the use of a single provider to ship PPE to the UK "presented significant operational synergies in the management of the complex and evolving logistical arrangements."
Iain Liddell, managing director of Uniserve, added: "The DHSC came to the right people as there are very few if any other companies that could have reacted so quickly… with the only intention of getting urgently required PPE to the frontline."
Internal NHS price bench-marking data suggests that some of the PPE sourced by Uniserve for the NHS was expensive.
On April 14, DHSC ordered 80 million 'Type IIR' face masks for £69.6 million from Uniserve – implying a price of 87p a mask.
According to market research commissioned by the DHSC, on April 14 the rolling 14-day weighted average price for Type IIR masks was 51p.
Mark Roscrow works for NHS Wales and, until last year, was the organisation’s Director of Procurement.
In his view, it appears that the government paid over the odds for the face masks Uniserve supplied.
“[87 pence] does look a little bit North of what we would expecting to pay even with the circumstances that were prevailing at the time,” he said.
When asked about the prices paid to Uniserve for PPE, a DHSC spokesman said: "Our priority has been to protect frontline health and care workers.
"These masks were delivered on time, in full and met the required standards."
Uniserve boss Liddell, who said margins on his government contracts ranged between 5% and 20%, added: "Uniserve was driven by the national interest in getting PPE to the UK as quickly as possible.
"The Chinese PPE market was brutal with Europe, USA and China buying most of the PPE and gazumping most other nations.
"We did well under these extreme circumstances to secure production and deliver urgent PPE… All costs went through the DHSC process for approval."
By late summer, the volume of PPE that Uniserve was importing started to cause problems.
Warehouses were full and shipping containers stacked up at Felixstowe, blocking our largest port.
James Kemball, a logistics company owned by Uniserve, got the job of relocating the PPE. 15,000 shipping containers were moved.
The government is now paying from them to be stored on at least two plots, covering 10 acres, at Port of Ipswich.
Thousands of containers are also sitting at Port of Tilbury, a field in Mendlesham and on a strip of rented land opposite Melton railway station.
Uniserve told us that it had organised the storage in such a way that it has saved the government money and that the cost "has now been reduced by up to 90%" compared to Felixstowe.
Uniserve insists it has no connections with government but the company’s headquarters, at Upminster Court, are also home to the constituency office of Julia Lopez MP, a cabinet office minister.
The Cabinet Office says Julia Lopez was not involved in the Uniserve deals. Iain Liddell says no one at Uniserve has ever spoken to her about and of the contracts the company won.