Electronic tagging contract
In June 2015 it was announced both G4S and Serco are under investigation by the Serious Fraud Office (SFO) for a charge of overcharging 'the government on contracts to deliver electronic tagging of convicted offenders'. The original contracts were won in 2005 and worth £700 million, but in 2013, when the contracts were due for renewal, the Ministry of Justice (MoJ) asked for supporting documentation from bidders. Anomalies were found in the data and the government called in PricewaterhouseCoopers for a forensic audit, leading to both firms pulling out and the SFO being brought in.
Both firms agreed to repay the taxpayer, with Serco paying £68.5 million and G4S paying £109 million, whilst, the then justice secretary, Chris Grayling announced that the contracts would be taken over by another outsourcing firm, Capita, on an interim basis using the G4S and Serco equipment. Technology firm Buddi were supposed to take over the contract, but were dropped in March 2014, with the view of Steatite Limited taking over in December 2014.
Data from the Centre for Crime and Justice Studies shows that, between March 2014 and February 2015, the mishandling of the contracts has lead to the MoJ continuing to pay G4S and Serco for the electronic tags, to the tune of £8.7 million and £4.5 million respectively. When the contracts were cancelled Grayling, 'promised "a fresh start for electronic monitoring"', Matt Ford, who undertook the work, said 'The amount of public money that has continued to be paid to these two companies for services that they have found to be managing at best incompetently, and at worst fraudulently, raises yet more serious questions about the nature of markets in public services and what happens when they go wrong.'
On the topic, the MoJ have said:
- 'G4S and Serco no longer deliver electronic monitoring services. We have always been clear Capita would continue to use the G4S and Serco equipment until new tags were developed.'
- Website http://www.g4s.com
- Karl West, City Focus: Seeking riches in danger zone, Daily Mail, 31 August 2009.
- Ian Dunt MoJ paid G4S & Serco millions for electronic tagging during fraud investigation Politics, 25 June 2015, accessed 25 June 2015.
- Agency Register September to November 2014 PRCA, accessed 29 January 2015