The Times Gets A Whiff Of Gravy Trains

Some time after many of us, The Times gets a whiff of gravy trains. Perhaps our noses are more attuned to local Serco and VirginCare pongs? Not to mention the WLBC gravy train some years ago!

But it’s more a stench! There are “true corporate looters“! As the scale of the coronavirus threat emerged early this year, most scented danger. Others caught the whiff of something else: the gravy train to end all gravy trains. Weekly come the stories of huge sums of public money spent with seeming disregard for value, without tender or transparency, for services of dubious value or poor quality, to companies and consultants which often have close links to power”.

That’s it in a nutshell. “Though public attention is fixed on lockdowns and curfews, a bad smell grows and the government would be wise to start clearing the air. Hundreds of millions of pounds were spray-hosed at companies promising to provide PPE.

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Some of the more questionable suppliers? A sweet manufacturer from Co Antrim swapped gob-stoppers for gowns and won contracts worth £107 million without competitive tender. Ayanda Capital, a family office specialising in currency trading and private equity, signed a £252 million contract for safety equipment, later supplying 50 million masks that could not be used.

Occupying the next carriage of the gravy train we have the management consultants, the global giants populated by former government advisers. The Whitehall procurement system “hugely favours large established companies with powerful political connections, true corporate looters”. So said Dominic Cummings once, but these large established companies have done rather well since March. The top Covid supplier by volume is PWC, whose 20 contracts are worth £24 million. McKinsey’s 16 projects add up to £38 million. KPMG was paid almost £1 million for three months’ work on the Nightingale hospital in Harrogate.

Last Friday it emerged that the bill for private consultants on Covid-related projects had reached £175 million, causing Meg Hillier, the chairwoman of the public accounts committee, to explode “What on earth are they doing? It is a very steep increase in a very short space of time. You cannot just tear up the rules and dish out taxpayers’ money in this way”.

Beyond the consultants, companies such as Serco, Sitel, G4S and Mitie provide the call handlers, organise testing sites, dispatch tests and so on, pushing the total cost of the system up to £12 billion. I can hear the exasperated ministers’ cry “Don’t you know there’s a bloody war on? Don’t you realise that speed was of the essence, that when infections were surging the government didn’t have the luxury of conducting long tender processes?

Or that when doctors are resorting to wearing bin liners it’s all hands on to the pump to provide PPE? Or that national diagnostic systems are not constructed without extra manpower? Having worked in government I have some sympathy but what does seem extraordinary is the reluctance to require much in the way of performance in exchange for these vast sums of money without penalty.

Last week the health minister Helen Whately replied that such penalties were not included in contracts with Serco or Sitel because they “are often unenforceable under English law”. Come again? What is the point of a contract if between the lines it reads “please take a lot of money with no penalty if you don’t deliver”?

Well, here in West Lancashire Serco Leisure Operating Ltd, automatically convicted of a planning order breach simply carries on ruining the Beacon Park Golf Course without penalty.

Beyond this housekeeping is a greater challenge, addressing the government’s over-reliance on the private sector to think for it, strategise for it and deliver core functions for it. Of course the virus was going to demand more hands to the pump, and importing experts is not in itself a bad thing; most of us do not wish to go back to pure state monopolies with their inefficiency and grinding slowness. But the extent of the Covid gravy train reveals more clearly than ever how dramatically the capability of the state has been eroded”.

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