MP seeks referral for Vodafone to covid corruption commissioner
Tory MP Sir John Hayes has called for Vodafone to be referred to the Covid Corruption Commissioner over allegations listed in a newly launched multi-million-pound lawsuit.
Last month it was revealed that a £120m legal action was launched against the telecoms giant over “bad faith” business practices by 61 current and former Vodafone franchisees.
The claim includes several allegations including the franchisees were sold the programme with a promise of uncapped earning potential but were often given commission structures that meant their stores were loss-making.
Additionally, the claim alleged Vodafone benefited from government business rate reliefs intended for the franchisees when facing financial distress during the Covid pandemic.
Now the MP for South Holland and The Deepings is seeking a referral.
He wrote to the Secretary of State for Business and Trade, Jonathan Reynolds MP, after “the matter was brought to my attention by a franchisee who previously ran a shop in my constituency.”
One of his questions to the Minister was “given the allegations about potential misuse of government covid financial assistance, will your department refer these allegations to the ongoing inquiry into potential misappropriation of public funds during the pandemic, and the covid Corruption Commissioner?”
It was revealed by the Guardian last month that Rachel Reeves appointed a health service and regulatory veteran Tom Hayhor as the Covid Corruption Commissioner.
Hayes added in his letter another question on if all the information on these allegations were “properly disclosed to the Competition and Markets Authority (CMA) ahead of the approval being granted?”
Back in early December, the competition watchdog approved Vodafone’s blockbuster £16.5bn merger with CK Hutchison’s Three UK to create Britain’s biggest mobile operator.
It came after nearly 18 months of deliberation from the CMA which had previously warned that the merger could lead to higher bills for tens of millions of customers.
The watchdog signalled in November that it would support the deal if both firms committed to delivering on an £11bn plan to upgrade the merged group’s UK network, which the group’s pledged to the day the deal got approved.
Commenting on the news, a spokesperson for Vodafone said: “This is a complex commercial dispute between Vodafone and some franchise partners, and we refute the claims. A mediator has now been appointed and a timeline for mediation has been proposed, so we will be engaging fully in this process with a view to resolving this commercial dispute.”
The Department for Business and Trade spokesperson added: “This government is committed to protecting taxpayers’ interests, which is why we have appointed Tom Hayhoe as Covid Counter-Fraud Commissioner in December to scrutinise Covid spending and work to recoup public money lost in pandemic-related fraud.”