The Baroness, the VIP lane and PPE profits

Dave Kellaway tells another everyday story of Tory corruption and capitalist greed.

 

Thanks to the admirable investigation of David Conn and other journalists at the Guardian, an even clearer picture is emerging of how Michelle Mone, a lingerie entrepreneur, made a killing with a lucrative government contract for Personal Protection Equipment (PPE) during the COVID pandemic. She had been made a baroness in 2015 and given a place in the House of Lords by David Cameron. Previously, she had led a government review into entrepreneurship and small business. Mone had left school at 15. She then made it as a woman in business while coming from a labour-supporting working-class family. Cameron saw that she was the ideal choice for a promotion in the supposedly less toxic Tory party he was building.

Once you look into these highly publicised business success stories, more often than not, you find they are not as pretty as they look. Her ascension was marked by some obnoxious ducking and diving. She invented qualifications for her CV, used tax avoidance schemes condemned even by George Osborne, and touted Trim Secret diet pills that were not as effective as her company claimed. She was already promoting these pills on her Baroness Twitter account at the time.

Despite all these dubious dealings she became the darling of the Tories and was even awarded an OBE in 2010.  She voted for cuts in tax credits for the poorest and condemned the rioters in London 2011 calling for the army to be used and the rioters to have zero human rights.

When the COVID crisis broke and the utter lack of NHS preparation of PPE stocks was revealed, she, like a number of other business people, saw an opportunity. Johnson’s government was desperate for a quick fix, so they discarded the normal methods for allocating public contracts and set up the so-called “fast or VIP lane,” where your bid was treated more quickly and favourably than those people without connections to the Tory government.

Effectively, it became the Tory “mates” lane. Contracts were signed, and it didn’t matter if your company had no prior experience producing PPE. This is what happened with Mone, even though she only had real experience making lingerie. She was on the case straightaway, telling ministers like Michael Gove that her people in Hong Kong could do the job. 

During one of the current investigations, which was started by the House of Lords standards committee, she said that she had only once tried to get the government to do what she wanted. The actual company, MedPro, that was quickly set up, was not directly or formally connected to her or even her partner. It was run through previous managers who had worked for her and her new partner (Doug Barrowman). MedPro PPE was awarded two contracts for £122 and £80 million by the government, despite the latter contract being awarded after the company had only been set up for 4 weeks.

The Guardian team has shown that she did not lobby just once but on a number of occasions. A crucial bit of new evidence is documentation from the HSBC bank that reveals Barrowman received payments from MedPro and also “invested” £3 million at one stage. Profits of 69 million pounds were recycled to Barrowman through a series of trust funds. He then syphoned off £29 million into a trust fund benefiting Mone’s family.

We can see here how these people work their businesses. Trust funds and locations such as the Isle of Man are used to conceal and move their money. Also, the profit rates on the PPE business are extraordinary: £69 million on contracts worth £200 million!

Nouveau-riche capitalists like Mone are not even very discreet. Really rich people know that it is not always a good idea to flaunt it. During the lockdown, the Baroness travelled to the Isle of Man to have a large wedding with Barrowman without having to worry about any restrictions. Remember, she was a House of Lords member who supported the government at the time. She then posed for pictures on her big yacht in the middle of the Mediterranean, pontificating about “going for your dreams.”

The story gets worse. A huge chunk of the PPE “her” associated company produced was totally useless. There is a legal dispute ongoing with the government over recovering this money. Her continued attempts to deny any connection with MedPro are belied by the discovery of WhatsApp messages that discuss the size and dimensions of the kit.

Her lawyer had said before that she didn’t put PPE Medpro on the register of financial interests for the House of Lords because:

Baroness Mone did not declare any interest as she did not benefit financially and was not connected to PPE Medpro in any capacity.”   

Unfortunately for Mone, the release of the HSBC documents today directly contradicts her defence. It is possible that in addition to the House of Lords inquiry, the overall COVID public inquiry will look into it. Sunak was the chancellor when the fast-lane contracting system was set up, so he has some co-responsibility for this affair.

Starmer’s reaction to Johnson’s handling of the pandemic at the time was measured and cautious. Even the criticism of the PPE contracting was muted. At the time, far less energy and resources were expended exposing and denouncing the Tory party than were expended on the Labour Party’s witch hunts against people on the left. A big campaign might have brought the Tories into crisis much earlier.

The whole episode points out how the NHS should not have to rely on outsourcing all its supplies. Why can’t it have its own publicly owned division for producing and organising, like PPE? That way, the standards of the products are much more likely to be correct, and nobody creams off the profits, which creates a lower price for the NHS. Any Labour government that seriously means to change our society would also have to create a system where companies are regulated much more strictly and the movement of money is made transparent. How can you nail down the taxes you need to make real reforms to benefit working people if you cannot even identify where the money is?

No doubt the Mone scandal is not the only one that will be exposed by any inquiry into the Tory government’s handling of the COVID pandemic. Watch this space.


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Dave Kellaway is on the Editorial Board of Anti*Capitalist Resistance, a member of Socialist Resistance, and Hackney and Stoke Newington Labour Party, a contributor to International Viewpoint and Europe Solidaire Sans Frontieres.


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