PPE Medpro Owes £39m in Taxes

A Crisis of Confidence: The PPE Medpro Affair

The company PPE Medpro, a firm associated with Doug Barrowman and his spouse, Baroness Michelle Mone, now confronts a staggering £39 million tax bill. This considerable sum represents a liability to the UK's tax authority, His Majesty's Revenue and Customs (HMRC), and compounds the company's financial turmoil. The tax obligation emerged from paperwork submitted by the company's administrators, revealing another layer to a deepening controversy. This development adds to a High Court judgement that already compelled the company to pay back £122 million, a figure which has since grown to £148 million with interest, to the government's Department of Health and Social Care (DHSC) for a violated contract involving personal protective equipment (PPE).

The Genesis of a National Scandal

During the chaotic initial months of the Covid-19 health crisis in 2020, the United Kingdom faced a desperate shortage of PPE. Hospitals and care homes reported alarming deficiencies, leaving frontline workers dangerously exposed. In this climate of national emergency, the government expedited its procurement processes, abandoning standard competitive tendering rules. This urgency led to the creation of a 'high-priority lane', colloquially known as the 'VIP lane', to fast-track offers from companies with political connections. Critics, including the High Court in a later ruling, deemed this lane unlawful, stating it breached principles of equal treatment and transparency in public procurement.

A Baroness, a Businessman, and a Lucrative Contract

It was through this contentious VIP lane that PPE Medpro secured its foothold. Baroness Mone, a Conservative peer appointed by David Cameron in 2015, recommended the newly-formed company to senior government ministers, including Michael Gove. PPE Medpro, established in May 2020 by a group that financier Doug Barrowman headed from the Isle of Man, was awarded two substantial contracts totalling over £200 million. One contract, worth £81 million, was for face masks. The second, valued at £122 million, was for the supply of 25 million sterile surgical gowns to the National Health Service.

From Lucrative Deal to Legal Dispute

The deal for surgical gowns soon unravelled. Upon delivery, officials at an NHS depot rejected the entire consignment. The DHSC asserted that the gowns failed to satisfy the necessary criteria for sterility, rendering them unfit for medical use. The government commenced legal proceedings in December 2022 to reclaim the £122 million paid to the company, plus the significant costs incurred for storing and eventually disposing of the useless items. PPE Medpro contested the claim, arguing the gowns were compliant with the contract and accused the government of "buyer's remorse" due to over-ordering PPE.

The Court's Damning Verdict

In October 2025, the High Court delivered a decisive judgment. Mrs Justice Cockerill ruled that PPE Medpro had indeed violated its agreement. The judgement noted the gowns were not properly sterilised or validated as such, and therefore were not compliant with the contract's specifications. The company was compelled to return the full £122 million, with interest accruing at 8% per year from late 2020. This legal victory for the government, however, immediately faced a significant hurdle: the company's ability or willingness to settle the debt. The full liability to the DHSC, with accumulated interest, now stands at £148 million.

A Web of Denials and Deceit

For years, both Baroness Mone and Doug Barrowman publicly and repeatedly denied any involvement with PPE Medpro beyond an initial referral. Through lawyers, they insisted they had no role in the company or the process by which it secured contracts. However, investigative journalism unearthed documents suggesting a much deeper connection. Leaked banking records indicated that Barrowman received at least £65 million from the profits of PPE Medpro. Of this sum, a staggering £29 million was transferred to an offshore trust established for the benefit of Baroness Mone alongside her children.

The Truth Emerges

In a dramatic reversal, the couple finally admitted their roles in a December 2023 television interview. Baroness Mone conceded she had repeatedly lied to the media, an admission that sent shockwaves through the political establishment. Barrowman confirmed his status as the final beneficial owner of the company and had received more than £60 million in profits. He also acknowledged transferring funds into a trust for his spouse and her offspring, noting his own children were also beneficiaries. While they maintained they had done nothing criminally wrong, the admission of deceit shattered their public credibility.

Financial Collapse and Mounting Debts

The day before the High Court judgment was made public, the company entered the administration process. This move, initiated by an entity linked to Barrowman, effectively shielded his personal assets from the company's liabilities. The administrator's filings paint a bleak financial picture. The company's total debts have swelled to £188 million. This includes the £148 million liability to the DHSC, the £39 million tax bill to HMRC, and smaller amounts to lawyers. Against these vast liabilities, the company has only £672,774 available for its unsecured creditors, a mere fraction of what is owed.

The Priority Creditor

Complicating the recovery of public funds is another of Barrowman's companies, Angelo (PTC), a business registered in the Isle of Man. The firm possesses a secured claim worth £1 million against PPE Medpro. This status gives it priority at the front of the queue for repayment from any recovered assets, ahead of the British taxpayer. The administrator's report indicates an expectation that this £1 million debt will be repaid in full, further diminishing the funds available to settle the much larger claims from the government and HMRC.

A Vow to Pursue the Debt

Despite the complexities of the administration process and the limited available funds, the government has remained resolute. Wes Streeting, the Health Secretary, publicly affirmed that officials would utilize every available method to reclaim the funds due to taxpayers. This case has become a symbol of the wider controversy surrounding pandemic procurement, which saw billions of pounds spent on PPE, much of which was later deemed unusable or written off at a huge loss to the public purse.

Wider Implications of Pandemic Procurement

The situation involving PPE Medpro is not an isolated incident. The National Audit Office and the Public Accounts Committee have heavily criticised the government's entire approach to PPE procurement during the pandemic. A report by the Public Accounts Committee described the scramble to obtain necessary equipment as "panic buying," which led to insufficient due diligence and the acceptance of "very high levels of risk". This resulted in vast sums of public money being wasted. Official figures show the government has written off nearly £10 billion for PPE that was either defective, unsuitable, or expired before use.

Criminal Investigation and an Arrest

The scandal has also triggered a criminal investigation. The National Crime Agency (NCA) opened an inquiry into PPE Medpro in May 2021, examining suspected offences including conspiracy to defraud and bribery. NCA officers have executed search warrants at properties and offices linked to Mone and Barrowman in London and the Isle of Man. A significant development saw a 46-year-old man from Barnet arrested in June 2024 on suspicion of conspiracy to commit fraud and attempting to pervert the course of justice in connection with the investigation. Barrowman was not the individual arrested.

A Peer Under Scrutiny

Baroness Mone's actions have had significant political repercussions. Following the initial revelations of her connections to PPE Medpro, she took a leave of absence from the House of Lords in December 2022, stating it was to "clear her name". This leave means she does not attend sittings, vote, or claim allowances. However, the House of Lords Commissioner for Standards had already launched an investigation into potential breaches of the peers' code of conduct. This investigation is currently paused pending the outcome of the NCA's criminal inquiry.

Public Outcry and Calls for Accountability

The saga has sparked widespread public anger and intensified calls for greater transparency and accountability in government contracting. Campaigning organisations like the Good Law Project have been instrumental in bringing legal challenges against the government's procurement practices, including the VIP lane. The case has raised profound questions about the intersection of business, politics, and public service, and the safeguards in place to prevent the misuse of taxpayer funds, especially during a national crisis. The cost to the taxpayer is not just financial; it has inflicted a deep wound on public trust.

Barrowman's Business Empire

Doug Barrowman, a Scottish-born accountant turned venture capitalist, operates a complex network of companies primarily through his Knox Group, which is based in the Isle of Man. His business interests span wealth management, property development, and technology. Barrowman's career has not been without controversy, with some of his past ventures involving the promotion of aggressive tax avoidance schemes that left clients with significant liabilities to HMRC. This history has added another dimension to the scrutiny he now faces over the affair related to PPE Medpro and the company's substantial unpaid tax bill.

An Uncertain Path to Recovery

With PPE Medpro in administration and its assets dwarfed by its debts, the path to recovering the £187 million due to the public purse and tax authorities is fraught with difficulty. The legal principle of limited liability protects the personal wealth of company owners like Barrowman from corporate debts. While the government has pledged a relentless pursuit, the intricate corporate structures and offshore trusts involved present formidable challenges. The outcome of this saga will be a significant test of the state's ability to hold individuals and companies accountable for their actions during the pandemic.

The Lingering Stain of the VIP Lane

The legacy of the VIP lane continues to cast a long shadow over the government's response to the pandemic. It created a two-tier system where political connections appeared to offer a significant advantage in securing lucrative public contracts. The process has been criticised for a lack of transparency and for potentially facilitating cronyism. The Public Accounts Committee noted the risk of conflicts of interest through this route was "high by design". The situation involving PPE Medpro is the most notorious example of this system, highlighting the potential for abuse when normal standards of public procurement are abandoned.

Awaiting Justice

As the NCA investigation continues and the team managing the firm works to liquidate the company's meagre assets, the public waits. The central questions remain: will the full sum of money be recovered for the taxpayer, and will there be criminal charges for those at the heart of the scandal? The controversy has laid bare systemic weaknesses in government procurement and has damaged the reputations of individuals who held positions of trust and influence. The pursuit of accountability is not merely about recouping lost funds; it is about restoring faith in the integrity of public office.

The Human Cost of a Scandal

Beyond the eye-watering financial figures lies a more profound cost. At the height of the pandemic's first wave, workers on the front lines of health and social services faced the virus with inadequate protection. The government's scramble for PPE was a matter of life and death. The revelation that vast profits were made from contracts for equipment that was ultimately unusable has been perceived as a deep betrayal of those workers and the public they served. The story surrounding PPE Medpro offers a stark reminder of the immense responsibility that comes with public office and the devastating consequences when that trust is broken.

A Future Reckoning

The fallout from this affair will undoubtedly persist for years. It will likely involve protracted legal battles, further political inquiries, and continued public debate. The case has become a cautionary tale about the dangers of abandoning due process, even in times of crisis. For the government, the challenge will be to demonstrate that lessons have been learned and that robust systems are in place to prevent a repeat of this "shameful episode". For the public, the hope is that justice will ultimately be served and that accountability will prevail over influence and profit.