Tiny Hitchin energy firm won £47 million NHS contract for hand gel
- Credit: Archant
A Hitchin-based energy company with four employees was handed a PPE contract worth almost £50 million at the height of the COVID-19 pandemic, it has been revealed.
Taeg Energy was handed two separate contracts worth £47.9m in total, including the biggest contract for hand gel given out by the Department for Health and Social Care (DHSC).
The first was worth £4.2m and the second £43.7 million. Taeg has been paid the full amount, the DHSC said.
Taeg was tasked with providing hand sanitiser to the National Health Service in April.
According to documents from the Department for Health and Social Care, the contracts began and ended within a day – April 19 and April 20 – with no competition for the service.
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When asked why an energy company was chosen, a spokeswoman for the DHSC said: “The Government issued a public call to action to support the increased requirements of PPE.
“Taeg Energy responded to this Government call to action and went through the same due diligence as all of the suppliers who responded. The Government call to action aimed to reach suppliers who had experience but also those who could provide through their business contacts.
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“All offers were prioritised based on volume, price, clinical acceptability and lead time – this is the time from an offer being accepted by DHSC to the supplier delivering those items.”
Taeg Energy is listed on the government’s Companies House listing as active, yet the company’s accounts show no activity since it was established in 2016.
We also questioned Tony Lumbard, Taeg’s commercial director, on the company’s profile, why there isn’t much information about Taeg online, and how a company specialising in energy obtained this contract.
Tony explained that Taeg was working on five “reasonably sized energy projects” before the COVID-19 pandemic halted the financial aspects of any deals.
He added: “We’re quite a diverse company, of the four of us working at the company, we’ve all done various different things over the years.
“What we’re doing at Taeg is to develop five plants around the UK that will generate regional energy in a carbon-neutral way. Our potential is enormous.
“We haven’t formulated our company completely, we were waiting on the finance to do it.”
When questioned on the procurement contracts, Tony said the company used the same channels to procure the PPE as it does to obtain raw materials for energy.
He added: “It just happened that the opportunity came up to take advantage of a situation with the PPE requirement. We were seen as being an organisation that could handle it.
“If you know the right people, someone will ring you up and say: Would you like this?
“As it happened, the PPE just happened to come along, so that’s more by coincidence.
“Businesses have to make money, it wasn’t done for nothing as work was involved. But if you look at costings against returns, a lot of companies made a massive amount of profit from procurement contracts. “There was a demand, and then it escalated.”
Matthew Gowing, Taeg’s managing director and main shareholder, said both contracts were completed in full in August, with all contracted volumes provided.
We spoke with Mr Gowing via email, who did not specify how much hand sanitiser Taeg provided the NHS with.
He said: “We simply answered the PM’s message for help from SMEs with supply of PPE, and applied through the COVID–19 government website.
“I have known my supplier/owner for around 10 years, from when I travelled around Scandinavia and the Baltics, securing commodities and products.”
He added: “The process Taeg went through was to be checked by the Ministry of Defence and DHSC, as well as our supplier.”
The company, which has four staff members, is registered at a cottage on Little East Hall Farm, St. Pauls Walden. It was set up in 2016.