Aspen Medical was given more than $1 billion in government PPE contracts despite no experience in large-scale procurement

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Health Minister Greg Hunt wrote and signed a glowing letter of commendation for a politically connected healthcare company while it was in the midst of negotiations with his department for lucrative multimillion-dollar PPE deals.

Key points:

  • Aspen Medical was given a glowing recommendation from Health Minister Greg Hunt
  • Former Liberal health minister Michael Wooldridge is a lobbyist for the company  
  • Aspen Medical has been named in a top-level money-laundering investigation in Sri Lanka 

Canberra-based Aspen Medical would go on to win taxpayer-funded contracts, without a public tender, worth more than $1.1 billion. After combined losses of $7 million over 2018 and 2019, these deals have seen the company's pre-tax profits soar to more than $420 million during the pandemic.

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Although Aspen Medical had no prior experience in such large-scale procurement, its PPE deals with the Department of Health were worth $500 million more than any other government supplier, including those with a background in the industry. 

A Four Corners investigation, in collaboration with Colombo's Sunday Times, has also established Aspen Medical has been embroiled in an international criminal probe into corruption and money-laundering. 

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Aspen medical was given more than $1 billion in government ppe contracts despite no experience large-scale procurement

Health Minister Greg Hunt has praised Aspen Medical in Parliament on multiple occasions.(ABC News: Adam Kennedy)

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The letter from Mr Hunt, under the Commonwealth government crest, described Aspen as, “a world recognised, nationally awarded company” and “a trusted supplier of… health services to the Australian government”.

It was left undated, and addressed, “To whom it may concern”.

The document was prepared and signed, however, in late February 2020.

In a statement to Four Corners, Aspen Medical said throughout February it was filling “initial smaller orders placed with us by the Department of Health for PPE… not pursuant to a contract”, which “began increasing in size”.

Department of Health documents released under Freedom of Information legislation show one contract for PPE was executed on February 22, 2020.

The letter also came after the company had been hastily engaged — with no proper contract in place — to procure thermometers for Australian ports and airports.

Former Health Department Secretary Stephen Duckett said he had never seen a letter like it.

“Here we have a minister in charge, or who's a minister assisting in the area of the public service, writing a letter, which is highly dubious, undated, fulsome, to whom it may concern,” Mr Duckett said. 

He said the fact that Mr Hunt signed it while the government was in talks with Aspen Medical was remarkable.

“So it is extraordinarily unusual, and in fact, dangerous for a minister or in fact for a public servant, to actually have any contact, any engagement, and certainly to write a letter of this kind.” 

Aspen Medical confirmed to Four Corners it had asked Mr Hunt for the letter.

Mr Hunt's spokesman said it was “written to support Aspen Medical in tendering for work in the United States and is appropriate for Australian firms assisting in international activity”.

In respect of the company's PPE contracts, the minister categorically denied any involvement in any “purchasing recommendations, assessments, approvals, contract negotiations, or decisions”.

“Minister Hunt did not discuss any contractual terms with Aspen Medical or any of their agents,” his spokesman said, and described Mr Hunt's engagement with Aspen as “minimal”.

Aspen medical was given more than $1 billion in government ppe contracts despite no experience large-scale procurement

Aspen Medical's headquarters in Canberra were opened by Prime Minister Tony Abbott in 2014.(ABC Four Corners)

Like other suppliers to the National Medical Stockpile, Aspen Medical was selected without having to compete in a public tender. This was to ensure Australia was able to move quickly to secure vital supplies of PPE in what had rapidly become a fierce international contest.

The federal government's procurement guidelines – which usually require a public tender for large contracts – were only formally suspended, however, after Aspen had begun filling federal government orders for PPE.

“The point of probity rules is to get the best value for money, and some people might call it red tape, but there's a trade-off between efficiency and urgency,” Mr Duckett said.  

Mr Hunt defended the value for money achieved in the government's PPE procurement, pointing to positive findings by the Australian National Audit Office (ANAO) which said the equipment was priced within an appropriate range.

The ANAO found that although there were “inconsistent due diligence checks of suppliers” and sometimes insufficient record keeping, the stockpile procurements were “largely consistent with the proper use and management of public resources”.

Aspen Medical's political connections

The company has enjoyed ties with senior ranks of the government and the parliamentary Liberal Party for more than a decade, including through introductions made by former Liberal health minister Michael Wooldridge, a former board member and lobbyist for the company.  

Dr Wooldridge is currently a director of Aspen's $1.3 billion joint venture in Indonesia. 

Even during the period in which Dr Wooldridge was banned as a company director by the Australian Securities and Investments Commission, over fiduciary breaches concerning the collapse of a retirement village investment scheme, the former politician continued to attend Aspen Medical board meetings as an adviser.  

Mr Hunt's spokesman said “we are not aware of, nor have any record of, any lobbying by Dr Wooldridge on behalf of Aspen Medical in relation to any procurement”.

Aspen medical was given more than $1 billion in government ppe contracts despite no experience large-scale procurement

Former Liberal health minister Michael Wooldridge is a close associate, former board member and lobbyist for Aspen Medical.(AAP: Julian Smith)

Between 2009 and 2021, Aspen Medical gave the Liberal Party more than $110,000 through political donations and fundraising attendances, including a $13,200 donation made to the Queensland LNP on the day Prime Minister Scott Morrison closed Australia's borders against COVID-19. 

The company has also been a regular donor to the Australian Labor Party, giving it almost $54,000 in donations and other receipts over the same 12-year period. 

This year, the company attracted headlines over a $40 million contract which The Australian said it had received “in a secret deal” with the Palaszczuk government to provide health services at a new Queensland quarantine facility.

The Queensland Premier defended the decision, claiming Aspen Medical was the only suitable operator for the job.

Aspen medical was given more than $1 billion in government ppe contracts despite no experience large-scale procurement

The Queensland government conceded it did not consult with local health care providers about the granting of a key COVID-19 quarantine contract that did not go to tender.(ABC: Peter Gunders)

Since 2007, the company has been awarded contracts without open tender by the departments of Foreign Affairs, Health, Defence and Customs and Border Protection.  

But after 2016, when the company's major deal with Defence to staff its on-base health clinics around Australia was not renewed, the company found itself in an increasingly perilous financial position. 

By 2019, it was going backwards, sustaining pre-tax losses that year of almost $5 million.  

The federal government's 2020 pandemic spending program, however, led to a dramatic reversal of fortune.  Aspen picked up contracts to do everything from administering vaccines to staffing aged care homes.

By July 2021, Aspen Medical's pre-tax profit had rocketed to $277 million.

Aspen medical was given more than $1 billion in government ppe contracts despite no experience large-scale procurement

Aspen Medical made hundreds of millions in profits from taxpayer funded contracts. (ABC Four Corners: Nick Wiggins)

Aspen Medical told Four Corners it had a “successful track record of procuring medical goods and equipment, including PPE, in support of our health solutions” throughout Australian and overseas.

It also said it has relationships “with multiple national and international suppliers”.

Aspen Medical embroiled in money-laundering probe 

Four Corners has also established Aspen Medical has been embroiled in a top-level money-laundering investigation following its involvement in a multimillion-dollar hospital project in Hambantota, on Sri Lanka's southern coast.  

It was a 2012 project for which the company obtained formal Australian government support through an $18.8 million insurance guarantee from the then Export Finance and Insurance Corporation (EFIC).

In a report to parliament, EFIC said it made the commitment on the basis the company had been hired to “supply equipment and associated medical design and infrastructure for the hospital”.

Aspen declined to answer questions from Four Corners as to whether it ever did supply any equipment or medical design. The company's statement said its sub-contract with EN-Projects, a Dutch company running the project, “covered the provision of a range of hospital engineering services” and that it had “engaged over 20 suppliers”.

Aspen medical was given more than $1 billion in government ppe contracts despite no experience large-scale procurement

The hospital in Hambantota, Sri Lanka, that Aspen Medical purported to supply equipment to.(ABC Four Corners)

But Aspen Medical's first transaction in Sri Lanka — the payment of 1.4 million euro to a mysterious British-Virgin Islands-domiciled company called Sabre Vision Holdings – is what has caught the attention of Colombo police.

It was part of 4.3 million euro and $US537,000 remitted in total to the offshore company by Aspen Medical, EN-Projects and a German company Juga Bau GmbH, which police “suspected… is a derivative or a result of an illegal activity”.

The company was secretly owned by a middle-man Nimal Perera, notorious for his links to the Rajapaksa family which has dominated Sri Lankan politics for decades.

In 2016, he confessed to collecting money for the prime minister's son Namal Rajapaksa, which led to Mr Rajapaksa's arrest.

Aspen medical was given more than $1 billion in government ppe contracts despite no experience large-scale procurement

Sri Lankan Prime Minister Mahinda Rajapaksa with his son Namal by his side, following his election victory in the general election in 2020.(AP: Eranga Jayawardena)

When police investigating the hospital deal first questioned Mr Perera about the source of unexplained funds that had arrived in his personal bank accounts, he told them it was an Italian businessman, whose identity he could not substantiate with an address or phone number.  

Asked further about Sabre Vision Holdings, he told the police he “does not know anything about” the company, and added “he believes that the company could be related to his Italian friend”. 

It was only when police received corporate documents from the British Virgin Islands that they learned the company was not owned by an anonymous Italian businessman – but by Mr Perera himself.

Pressed by Four Corners about why he had lied to the police, Mr Perera said: “No, I don't want to answer, sorry”. 

Mr Perera confirmed he had never worked in the health sector and said he had nothing to do with Aspen Medical. He had worked as an agent for EN-Projects, he said. 

In 2013, Sabre Vision Holdings received hundreds of thousands of US dollars which had been paid out in a global bribery scheme orchestrated by EADS, the parent company of aircraft manufacturer Airbus.

Airbus' campaign of kickbacks in Sri Lanka, and around the world, became the subject of a deferred prosecution agreement between Airbus and Britain's Serious Fraud Office, and in January 2020, Airbus paid $US4 billion to settle the corruption investigation with French, British and US authorities.

Aspen Medical said it had not received “any requests from any government agency or court of law anywhere in the world” regarding the hospital project but would support any such inquiries. It added that the Airbus scandal only became public in 2019, years after its payments to Sabre Vision Holdings.

It said: “We have a strong set of values that would preclude us working with organisations involved in corrupt practices.” 

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