Baroness Michelle Mone will take a leave of absence from the House of Lords with immediate effect.
Baroness Mone is at the centre of controversy over her links to a firm awarded 200 m of PPE contracts.
The government is trying to get ministers to publish documents related to the contracts, despite a motion by Labour in an attempt to force them to publish documents related to the contracts.
PPE Medro was granted contracts to make surgical gowns and masks during the COVID epidemic, after Baroness Mone flagged the firm to ministers through a so-called VIP lane system.
With immediate effect, Baroness Mone will be taking a leave of absence from the House of Lords to clear her name of the allegations that have been unjustly levelled against her, according to a spokesman for Baroness Mone. The leave of absence means Baroness Mone will not be able to take any seats at the House, vote on any proceedings and will not be able to claim any allowance.
Baroness Mone still has the Conservative whip.
Labour spokesman Angela Rayner accused the government of using the pandemic as a way to get rich and that 700,000 of taxpayers money a day is now being wasted on storing the unusable PPE and called for the release of PPE contracts awarded to PPE Medro.
Ms Rayner said this looks very dodgy people making huge amounts of money on PPE that couldn't be used. That needs to come out and it needs to be out in the open. The kit was faulty, according to the company.
The VIP lane system saw a separate mailbox set up for MPs to send on offers from firms, but it led to the government being criticised for giving preferential treatment to companies with political contacts.
Ms Rayner said that Tory MPs can either back Labour's binding vote to force ministers to come clean on the murky award of 203 m in taxpayers money to a shady company linked to a Tory peer, or they are choosing to be complicit in a cover-up. Baroness Mone is currently being investigated by the House of Lords for standards, with parliament s website saying the probe is over alleged involvement in procuring contracts for PPE Medpro leading to possible breaches of the house of Lords code of conduct. A spokesman for the Department of Health and Social Care said due diligence was carried out on all companies that were referred to the department and each company was subject to the same checks.
We acted quickly to procure PPE at the peak of the epidemic, competing in an overcrowded global market where demand massively outstripped supply. They said the department was currently engaged in a mediation process with PPE Medpro and could not comment on the specifics of the contract.