Pritti MistryBusiness reporter
A company linked to Baroness Michelle Mone has failed to meet a deadline to repay £122m for breaching a Covid-19 personal protective equipment (PPE) contract.
The Department of Health and Social Care (DHSC) won a legal case earlier this month against PPE Medpro, a consortium led by Lady Mone’s husband Doug Barrowman, over claims the PPE did not comply with relevant healthcare standards.
A High Court judge ruled some of the company’s gowns they supplied were not “sterile”.
Health and Social Care Secretary Wes Streeting said the government would “pursue PPE Medpro with everything we’ve got to get these funds back” after the company failed to pay the damages cost by 16:00 BST on Wednesday.
PPE Medpro entered administration on 30 September, the day before the court judgement.
Streeting said: “At a time of national crisis, PPE Medpro sold the previous government substandard kit and pocketed taxpayers’ hard-earned cash.
“PPE Medpro has failed to meet the deadline to pay – they still owe us over £145 million, with interest now accruing daily.”
The firm was ordered to pay interest of £23.6m, which means the total sum owed is £145.6m.
According to the DHSC, this sum will accrue interest at 8% per year from Thursday until it is fully paid.
Forvis Mazars, one of the joint administrators appointed to take control of the business and recover money owed to creditors, declined to comment.
The National Crime Agency (NCA) previously said it was investigating the PPE Medpro case.
Mr Barrowman’s spokesman had said £83m of the government deal was paid to other companies but it is unclear whether they are being looked at by the NCA.
PPE Medpro was awarded a government contract in 2020 to supply PPE after being recommended by Baroness Mone.
However, after ordering 25 million sterile gowns from PPE Medpro, the government later launched legal action in 2022 through the High Court, claiming the gowns did not comply with the agreed contract.
PPE Medpro argued it had complied with the contract and that the gowns were sterile.
According to the company’s most recent accounts for the period ending 31 July, the business had £666,025 in net assets.
The document filed to Companies House also mentioned how the firm had used about £4.2m in reserves to fight the legal dispute.
Since the court judgement, Baroness Mone has faced cross-party calls for her to be stripped of her peerage.
However, peerages can only be removed by an act of Parliament.
