Thread by @JolyonMaugham

Yesterday I showed how, on Govt's own figures, it overpaid a politically connected PPE supplier by £36m+ for IIR facemasks.

In fact, if you look at the contract as a whole, which included FFP2 facemasks, the overpayment was much higher. I'll come back to that in a moment.

https://twitter.com/JolyonMaugham/status/1315553658671632385

But, first, bear in mind that although contracts were awarded by DHSC the key triaging of bids and supplier due diligence was undertaken by Cabinet Office.

That casts a certain pall on explanations like this - provided by Ayanda to journalists - about the role of Andrew Mills.

I will return in the coming days to some correlations between highly generous pricing and relationships between the beneficiaries of that pricing and key figures in Cabinet Office.

But I have learned that DHSC was prepared to pay suppliers a premium of 25% over average per unit prices without quibble. If a friendly insider in Cabinet Office gave you that information you could profit handsomely from it.

Government is, very belatedly, starting to publish the contracts underlying the PPE awards and generally it seeks to black out the per unit price paid so we can't see what it (over)pays connected parties. But it doesn't always do this very carefully.

My thread yesterday compared the per unit price paid to Ayanda for 150m IIR face masks (65p) with the average price paid on that day by DHSC for IIR face masks (41p) to calculate a profit of £36m on that part of the contract alone.

But there was another part of the contract.

DHSC also purchased in the same contract (contractsfinder.service.gov.uk/Notice/Attachm…) 50m FFP2 facemasks for which it paid £155m giving a per unit price of £3.10.

If one looks at the PPE Buy Cell Pricing Benchmarks you can see that on the day of the contract the average price paid for an FFP2 face mask moved from about 50p to about £2.90: perhaps in response to this contract alone?

Remember, the calculations show Ayanda generated a profit of £36m on the IIR facemasks part of the contract. At 50p (£3.10-0.50) x 50m the FFP2 facemasks would add another £130m in profit; at £2.90 they would add another (£3.10-£2.90) x 50m equals another £10m in profit.

The pricing is not the only inexplicable feature of the Ayanda contract. These clauses - which I believe to be unique to Ayanda - entitling it to sell at a historical high price but deliver when it likes and deliver not to sample have caused outrage amongst procurement experts.

But even if you ignore those features the profits alone - amounting on Government's own figures to between £46m and £166m on a £252m contract entered into by a company with no PPE expertise at all but links to Government - are simply jaw dropping.

There is more to come.