McDermott Comment I Delay on PPE Cost Taxpayer 10bn, the National Audit Office Reports


Sharon Lamb, partner at law firm McDermott Will & Emery, said:

“Coming fast on the heels of last week’s NAO report on procurement, this report again makes deeply concerning reading about the procurement and supply chains and their emergency resilience.

Some key points:

  • Only 14% of the government procured PPE reached social care providers. The NAO report alludes to some of the government guidance that prioritized NHS workers over social care workers but doesn’t mention that the government published derogations (easements) to PPE certification requirements which would benefit only NHS workers – this meant that some PPE could not be used in social care settings. Health and social care are funded differently despite many efforts to achieve greater integration over recent years. The report recommends that the government “needs to understand why national bodies provided more support to hospitals than to social care”
  • Today, the government announces its Spending Review – given the challenges in social care funding (and the impact of care provision) and the falling income and rising costs (see para 3.16), there are concerns across the sector that government money “earmarked” for social care will not reach the front line and will affect financial resilience. The pandemic has highlighted the difficulties of the different funding models of NHS v social care (which is channeled through local authorities where the DHSC does not have the same leverage over spend).
  • Over recent years, the Department of Health and Social Care has moved to a centralised purchasing system with the aim of saving money for NHS organisations. To do this, the Department of Health and Social Care “top sliced” NHS providers so that they were incentivized to purchase centrally (see para 1.7). Whilst SCCL has led to financial savings, the report highlights a lack of resilience with respect to pandemic planning and infrastructure. One question that might be asked is whether or not diffuse distributional channels and greater options for provision would have assisted the flow of PPE to the front line.

The report indicates a move to more local sourcing options in the future.”