HMPPS says ‘lessons have been learned’ as Serco and G4S bag electronic monitoring contracts

Deals worth up to £450m come almost a decade after firms admitted overcharging government to the tune of £170m

By Jim Dunton

24 Nov 2023

The boss of HM Prison and Probation Service has told MPs that lessons from past experience with electronic tagging contracts have been learned as Serco and G4S have been awarded new deals worth up to £450m.

The firms wrongly billed the Ministry of Justice for tens of millions of pounds under electronic-monitoring contracts first awarded in 2005. Sometimes multiple charges were made in relation to the same offender, in other cases charges were made for offenders who were dead.

G4S repaid the department more than £100m after details of the overcharging scandal emerged in 2013; Serco repaid £70.5m. Both firms removed themselves from the procurement process for the “next generation” of electronic monitoring devices. G4S subsequently returned to supplying electronic tags to government.

Investigations by the Serious Fraud Office resulted in Serco being fined £19.2m plus £3.7m costs and G4S being fined £38.5m plus £5.9m costs over the scandal.

Earlier this month Serco landed a £200m MoJ contract to deliver electronic-monitoring services in England and Wales for six years to May 2030. The deal will be worth an additional £75m if two one-year extension options are exercised.

G4S was granted a £175m contract to deliver monitoring technology, which includes devices for location monitoring and alcohol monitoring.

In a letter to members of parliament’s Public Accounts Committee, HMPPS chief executive Amy Rees said the service’s approach to the new contract arrangements had “been informed by previous experience and lessons learned, as well as government best practice”.

She said specific supplier “accountabilities, roles and responsibilities” had been set out in the respective contracts agreed with Serco and G4S.

“During implementation of the new service, both suppliers will be required to report on progress and risks through an implementation board,” she said. “This board will oversee delivery of the integrated implementation plan and ensure risks are appropriately managed through the various phases of transition.

“The implementation board will report into a service delivery board, chaired by the head of EM operations, where ultimate responsibility for holding suppliers to account and dealing with any issues will take place. This will ensure there is senior-level oversight of progress and risks.”

Rees’ letter was prompted by a recommendation in PAC’s Transforming electronic monitoring services report last year, which called for HMPPS to set out how it would handle risks in the programme once suppliers had been appointed.

The letter was dated 27 October but was only published yesterday. The Serco and G4S contracts were announced on 8 November.

Rees said that as field and monitoring services supplier, Serco would act as service integrator and be responsible for the running and management of the end-to-end service.

She said that in addition to their individual contractual obligations, Serco and G4S had also signed a separate collaboration agreement setting out clear expectations on behaviours and ways of working.

“Both suppliers will appoint a suitably senior lead officer who will be specifically accountable for ensuring their respective teams adhere to the requirements set out in the collaboration agreement,” she said. “These leads will attend the service delivery board.”

Published in October last year, PAC’s Transforming electronic monitoring services report detailed a litany of concerns about HMPPS and MoJ’s handling of tagging.

Committee chair Dame Meg Hillier said the current system was “outdated” and at “constant risk of failure”, while the report flagged £98.2m wasted on the scrapped Gemini case-management system, which MPs described as “high-risk and over-ambitious”.

MPs also criticised the MoJ and HMPPS for failing to rigorously evaluate whether tagging reduces reoffending before pushing ahead with a £1.2bn programme to expand it to another 10,000 people.

As of March last year around 15,300 offenders were tagged, according to the report.

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