G4S tagging contract – Serious Fraud Office to investigate

Breaking news today that the UK Justice Minister, Chris Grayling, has asked the Serious Fraud Office to investigate G4S for overcharging for tagging of criminals.

“Overcharging by G4S and rival Serco ran to tens of millions of pounds” according to BBC reports. The two firms have shared the contracts for the tagging work for some years. Serco has voluntarily agreed to take part in a "forensic audit" of what happened. G4S was given the same opportunity to co-operate with the government investigation, but refused, which has presumably triggered the criminal investigation. The firms are alleged to have charged for people who weren’t actually being monitored– because they were out of the country, or in a small number of cases, had died!

There have also been allegations of over-charging in terms of the rates, with reports that the UK was being charged far more than other countries. “A report last year revealed tagging cost around £13.14 per criminal per day in England and Wales — but £1.22 in the US”.

Grayling also said that he has launched an internal disciplinary investigation into how the contracts were managed inside the Ministry of Justice “after uncovering evidence that officials knew in 2008 that there were problems with how both companies were billing for tagging”.

And there will also be a wider review of all contracts held by G4S and Serco across Government – that’s a considerable task as these firms are two of the very biggest providers of services to the public sector, and in the case of Serco, the work covers everything from blue-collar type outsourcing, to IT, Welfare to Work contracts and many other activities. G4S are also in Welfare to Work as well as their core security and justice related activities.

We’ll have more to come on this tomorrow…

Voices (2)

  1. Cicero:

    Please reread my comment on 31.10.12 at 8.34 pm. There again, what do I know? I’m just a tax-payer paying very little tax now.

    1. Peter Smith:

      Here is “Cicero’s” previous comment:
      First of all I presume the writer of this article meant to say ‘How good a deal is the MoJ (not the ‘BBC’) getting out of the current deal?’ Or did you mean to imply that the BBC themselves require an on-going supply of tagging devices from the MoJ? For which employees may I ask?

      Also the name of the company you refer to is not ‘Serco Geographic’ but ‘Serco Geografix’. The web contains some fascinating detail about Serco Geografix including the amount of dividends it paid last year, all of which went presumably to its single shareholder, called (you’ve guessed it) Serco Ltd. Indeed Serco Geografix’s ‘gross profits’ pale in comparison to its dividends. Also obtainable is its ‘book value’ and ‘cash’ graphs which look interesting to the untrained eye. The company’s latest accounts are available via the web. For £4.99 it’s a must as a stocking-filler. You can also find online the company’s (estimated) number of employees and the amount it spends on salaries.

      It would be nice to know how much Serco Geografix charge Serco Monitoring per tagging unit (tag, telephone, hardware in general). Presumably these units can be pretty much recycled. As one offender or bailee comes off the tag, so another one goes on. The cost to Serco Geografix of such recycling (maintenance, installation, removal) would be presumably quite low. So wouldn’t the cost of supply reflect this? If units are being recycled, there does not seem much need for further ‘manufacture’ (not for the immediate internal market anyway). Procurement aficionados like to bandy the word ‘innovation’ around but I cannot see much incentive here.

      As a professional interpreter my career has been decimated by a bungled procurement exercise. I listened to the government in the 70′s and 80′s when it encouraged us all to learn languages. I am British born & bred. It took me years to perfect the language and then hone it in the service of the MoJ. Now a career that was professionalised by the government has been deprofessionalised. What next? Are they going to turf solicitors out of court in favour of Citizens Advice Bureau personnel (no reflection on them is intended)? The upside to living off scraps is that I have time to have a long hard look at procurement and its intricacies. I encourage everyone to spend £4.99 this Christmas.

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