Exclusive: Tony Blair advising Covid contract ‘overnight billionaire’
Exclusive: Tony Blair advising Covid contract ‘overnight billionaire’
Former prime minister is a consultant for Pasaca, whose owner Dr Charles Huang is embroiled in court cases over £4 billion UK government Covid contracts
This story was first published on Democracy for Sale
By Peter Geoghegan and Russell Scott
Tony Blair is a paid political and business consultant to a contentious investment group which made billions of pounds from the UK taxpayer for supplying Covid-19 tests, Democracy for Sale can reveal.
The former prime minister is working for Pasaca, owner of Innova Medical Group, which was given more than £4 billion worth of pandemic contracts with the UK government to provide lateral flow tests.
Innova has been the subject of controversy over value for money for British taxpayers. The firm’s founder, Chinese-American businessman Charles Huang, has also been accused of spending the profits of Covid contracts on luxury aircraft and property.
A spokeswoman for Blair said he met and began working with Huang in 2022 and that the former Labour leader had no involvement in Pasaca’s Covid testing business or any interactions with the UK government on its behalf.
“Mr Blair’s advice has been around geo-political issues and latterly principally around a technology company spun out of the work done at Strathclyde University. Mr Huang has never asked Mr Blair to lobby or approach the UK Government in any way about Covid tests,” the spokeswoman said.
Huang has said that Innova made about $2 billion (£1.6 billion) in profits on UK Covid contracts, which is thought to be one of the largest amounts received by a single pandemic supplier.
In court papers filed in California in July and obtained by Democracy for Sale, two of Huang’s former partners accuse him of misappropriating Pasaca funds and making fraudulent transfers.
Huang is accused of spending millions of dollars from Covid contracts profits on a personal jet, houses for his family and mistresses and of transferring $200 million to offshore accounts in case he needed to flee the United States. A proposed bio of Huang’s life was entitled “overnight billionaire”.
A spokesman for Huang said he “vehemently denies these baseless allegations. They have been made by disgruntled former employees who have benefited enormously from the company's generosity and yet are now manipulating the truth to satisfy their greed".
July’s court papers also allege that a £50m donation that Huang made to Strathclyde University in Glasgow in 2021 was “invested in entrepreneurial ventures believed to be at least under partial control” by Huang. The businessman’s former associates allege that his “charitable distributions are made for the purpose of cloaking illegitimate and fraudulent offshore transfers”
Both Huang and Strathclyde University strongly denied this.
"Dr Huang does not retain any control over the use of this gift and his Foundation agrees its broad uses which are to support research, student scholarships and entrepreneurship activities within the Strathclyde community," a spokesperson for Strathclyde University said.
“The donation from the Charles Huang Foundation enables the University to expand its continuing collaborative work with business, industry, and the public sector to tackle major challenges of our time,” the spokesperson added.
As the Guardian previously reported, Huang is also in legal disputes with other former business partners who have accused him of being “high-end con artist” who squandered or moved for his own use “more than $1bn of … assets generated from UK sales.”
Huang had been a relatively obscure businessman before his fortunes were transformed when Innova was fast-tracked as a supplier after its UK partners - who are now also in a legal dispute with Innova - sent an email in July 2020 to Dominic Cummings, who was adviser to then prime minister Boris Johnson.
Innova became the sole supplier of rapid Covid tests for four months during the crisis, prompting the National Audit Office to warn that there were “risks to value for money”. Innova said it was “successful in a highly competitive tender process” and its tests were cost effective and delivered on time.
Huang has alleged in civil lawsuits that two former executives defrauded Innova of more than $100 million, which they have denied.
lair, who has provided advice to Keir Starmer as Labour moved from opposition to power, has previously faced criticism for his work with controversial partners.
Clients have included the authoritarian governments of Kazakhstan and Azerbaijan. The Tony Blair Institute for Global Change (TBI) has also advised Saudi Arabia on social and economic reform, with the relationship continuing after the murder of Jamal Khashoggi, a Washington Post journalist killed at the Saudi consulate in Istanbul in 2018.
Health secretary Wes Streeting, foreign secretary David Lammy and science secretary Peter Kyle all appeared at TBI events at this week’s Labour conference.
Blair’s institute indicated due diligence had been done on Huang. Blair has a policy of not lobbying the government on behalf of any company or business.
Jo Maugham, founder of the Good Law Project, said "there are very real concerns about how this tiny firm, now riven with multiple accusations of fraud and misconduct, came to secure more than £4 billion of public contracts. And that Tony Blair felt it appropriate to become an advisor to Innova’s founder also raises questions about his judgement.”
Baron Prem Sikka, an accountant and Labour peer, said Blair’s work with Pasaca was “another page in the story of…leading current and past political officeholders [being] available for hire”.
“Tony Blair's phonebook and capacity for political consultancy was built entirely with public money during his time as MP and Prime Minister.”