Applying for PhD after a poor master's I am attempting to apply for a PhD but made rather a mess of my masters. Advice from anyone involved in the process is appreciated. 

I am applying in the UK, and have a good bachelor's, which is all that is necesary for funding. I worked for 2 years before doing a master's. My field is computer science or bioinformatics. 

The master's went wrong - I failed about half of my modules, although I passed them on retake. I produced a good project, but did not impress my supervisor. He doesn't dislike me, I just just ended up looking flaky. Regarding what went wrong, on the one hand, my cohort had an exceptionally high failure rate, but on the other I didn't work hard enough, and got quite depressed after failing some of the first set of exams. 

There is a reasonable question over whether I would be suited for a PhD, but you could say that about anything hard that I try and do next. 

I need a bounce-back plan. What can I do to mitigate the damage? How bad is the damage? Do you accept candidates with less than ideal transcripts and so-so references, given a good work history and supportive references from earlier supervisors?
Delay applying for a year and work on a new project, where you can perform much better (now that you have more experience). Get a publication out of that and work with someone new, who will write you a good recommendation letter.

I know for a fact that many labs are very interested in getting bioinformaticians, so it shouldn't be hard if you are not looking for a great salary (which you shouldn't be: this is a career investment).