A company at the centre of a major personal protective equipment (PPE) scandal has been forced into liquidation, leaving UK taxpayers facing a loss of nearly £150 million.
Court Orders Winding Up of "Hopelessly Insolvent" Firm
The Department of Health and Social Care (DHSC) successfully applied to the High Court to wind up PPE Medpro. Government lawyers argued the company was "hopelessly insolvent" and should not be allowed to continue under administration. The court heard that with interest and costs, the DHSC is now owed £148 million.
This debt stems from a 2020 contract where PPE Medpro supplied 25 million surgical gowns for £122 million. In October, the High Court ruled these gowns were not certified as sterile, as the contract required, rendering them unusable by the NHS.
VIP Lane Links and Profits Under Scrutiny
PPE Medpro was awarded two government contracts worth £203 million in May 2020. The deals were fast-tracked through a "VIP lane" after Michelle Mone, a Conservative peer appointed to the Lords by David Cameron, approached the then minister Michael Gove.
For years, Mone and her husband, Isle of Man-based businessman Doug Barrowman£65 million from its profits, transferring £29 million to an offshore trust benefiting Mone and her children.
Following the court ruling, Health Secretary Wes Streeting vowed to pursue the company "with everything we've got" to recover public funds for the NHS.
Complex Road to Recovery for Taxpayers
The path to reclaiming the money is now fraught with legal complexity. HMRC has submitted a claim for £39 million in unpaid tax, including £31 million in corporation tax, further complicating the liquidation process.
Administrators had suggested there might be "potential" legal claims against unnamed third parties that could recover funds, but provided no details. The DHSC opposed their plans, leading to the winding-up order.
Michelle Mone, who took a leave of absence from the House of Lords, has said she does not wish to return as a Conservative peer. With PPE Medpro in liquidation, the government faces significant hurdles in its attempt to recoup the massive sum owed from the controversial pandemic deals.
