Welcome to the Parliament Brief, where Spotlight, the New Statesman’s policy section, digests the latest and most important committee sessions taking place across the House of Commons and House of Lords. Previous editions can be found here.
Who? The Public Accounts Committee (PAC), a cross-party committee of MPs, holds annual sessions dissecting the spending of different government departments. On this occasion, the Department of Health and Social Care (DHSC) had its accounts for the 2022-23 financial year scrutinised.
When? Wednesday 14 March 2024, 1.30pm.
What was discussed? The session focused on whether there had been excess spending, and how the department could recoup money that had already been spent. Interestingly, it also focused on last year’s PAC session scrutinising DHSC accounts for the 2021-22 financial year, where the committee questioned DHSC chiefs on £14.9bn worth of personal protective equipment (PPE) and other medical items it wrote off during the pandemic. “And that was a significant cost to the taxpayer,” said Meg Hillier, the Labour chair of the committee, in her introductory remarks this week.
There has been controversy surrounding the government’s procured PPE contracts during the pandemic, including alleged fraud. The DHSC carried out an assessment of “high-risk” PPE contracts, which covered 28 per cent of the total PPE contracts awarded. This identified a 1.7 per cent “risk of loss” from fraud and error, valued at roughly £38.4m.
So what did they say? Hillier began by asking Shona Dunn, the second permanent secretary at DHSC, for an update on the “number of contracts that are still in dispute”.
Dunn, who liaises with the department’s “disillusions team”, which is leading on recuperation efforts, said that the number of contracts they are chasing “has come down substantially” from the 45 cases noted in March 2023. The “number is now under 20 [cases]”, she said.
Not all of the contracts being chased by the department are over suspicions of fraud, Dunn added; some account for “instances of dissatisfaction with the contracts as a consequence of our review of the material [provided]”. This includes circumstances where suppliers provided “materials that weren’t quite up to the standard we expected them to be, or were for some technical reason missing information, documentation”. Dunn added: “But where we identify [instances] that people were… effectively attempting to profit at the expense of the taxpayer, we take a very, very firm hand and we pursue that.”
Anything else? Hillier wanted specifics on how many active cases were being escalated and taken to court, and the total amount that had been lost and recouped. But the department, citing the complexities of “live” cases, refused to publicly disclose that information. “Why don’t we offer you [the committee] a private briefing specifically on the fraud?” Chris Wormald, permanent secretary at DHSC, interjected during Hillier’s questioning of Dunn.
Hillier accepted the offer, but added: “What we want to do is shed some light on this in the public domain. I think the public would want to know that somebody’s looking at what’s going on.”
What next? The department won’t have its accounts scrutinised again until around the same time next year – but an update on how much money was lost on fraudulent PPE contracts will be coming soon. Dunn said it would take “months… rather than years” for the department to finalise its recuperation efforts and report back to parliament and the public.
“At some point, we will get to the point where the diminishing returns [of continuing the investigation] and the cost of the exercise is greater than the cost of the return,” Dunn said, “at which point we’ll sort of make a decision to close that team.”
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