Deadline day for firm linked to Tory peer Baroness Mone to pay back £122 million over COVID contract scandal
Today marks the deadline for a firm linked to Baroness Michelle Mone to repay £122m for supplying defective PPE at the height of the Covid pandemic.
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PPE Medpro, the company founded by her husband Doug Barrowman, has until 4pm today to make the payment.
Mr Barrowman has described himself as the ‘ultimate beneficial owner’ of PPE Medpro, and says £29m of the profit was paid into a trust benefitting his family, including Baroness Mone and her children, but says he was never a director and the company is not personally liable for the money.
PPE Medpro’s most recent accounts show assets of £666,000.
Last week, Mr Barrowman's spokesman said "consortium partners" of PPE Medpro are "prepared to enter into a dialogue with the administrators of the company to discuss a possible settlement with the government".
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Earlier this month, PPE Medpro, a consortium led by Lady Mone’s husband Doug Barrowman, filed to enter administration.
The consortium was awarded government contracts by the former Conservative administration to supply personal protective equipment (PPE) during the pandemic after Lady Mone recommended it to ministers.
The Department of Health and Social Care (DHSC) sued PPE Medpro at the High Court over allegations that it breached a deal because the gowns were “faulty” by not being sterile.
In her ruling, Mrs Justice Cockerill said the gowns “were not, contractually speaking, sterile, or properly validated as being sterile”, which meant they could not be used in the NHS.
Barristers for PPE Medpro told the trial it had been “singled out for unfair treatment” and accused the Government of “buyer’s remorse”, claiming the gowns became defective because of the conditions in which they were kept after being delivered.
Lady Mone criticised the judgment, calling it a win for the “establishment”, while Mr Barrowman said it was a “travesty of justice”.
It is understood the partners want to resolve the issue and administrators have been urged to get in touch with the Government to reach an agreement.
Medpro UK spent £4.3 million defending its position.
It said that offers to settle on a no-fault basis have been made, including a remake of the 25 million gowns or a £23 million cash equivalent, but these were rejected.
PPE Medpro insists that it provided all 25 million gowns and that it disputes that the gowns were not sterile.
It has said that the court made its ruling on a technicality.
The gowns had a resale value of £85 million at the end of 2020 and if they had been sold on the international market as non-sterile gowns, it said.
Baroness Mone, who created the lingerie brand Ultimo, which she sold in 2014, was made a Conservative peer by David Cameron in 2015.
She has said that she has “no wish to return” to the House of Lords as a Conservative peer.