Holding the Private Sector to Account or Holding Critics at Bay?

This post was originally published here on The Huffington Post on 30 July 2013, by one of our team, Sarah Cheverton.

Margaret Hodge, MP, chair of the UK government's public accounts committee, has confirmed reviews into the UK Border Agency's COMPASS contract and into private sector delivery of public services.

The news follows lobbying from housing social enterprise Kazuri over allegations of G4S's failures in managing the COMPASS contract for asylum seeker housing after the alleged eviction of three female asylum seekers.

Responding to Kazuri's allegations in a letter, Margaret Hodge said: "As you will know, the former UK Border Agency (now part of the Home Office) recently tendered for new asylum housing contracts, which began operating in May 2012, each covering a region of the UK.

"You raised a concern that asylum seekers have been evicted from properties because of rent arrears that had arisen because G4S's subcontractors were not paying landlords.

"I have forwarded your letter to the National Audit Office (NAO), as the issues you raise regarding asylum accommodation are of interest in the context of the NAO's work in this area.

"The NAO plans to look at COMPASS and the arrangements for asylum accommodation.

"This work will feed into a wider review which the NAO is undertaking looking at the delivery of public services by private sector contractors (including G4S) to support a Public Accounts Committee hearing with the contractors in the Autumn.

"I understand that the Home Office is aware of general concerns around the contracts in operation, although it was not aware of the specific details around G4S and rent arrears and will look into this further."

In a recent interview with the Guardian, Hodge countered the common criticism that select committees 'lack teeth', saying:

"The Institute for Public Policy Research once did a study on select committees and one anonymous civil servant told them that they don't change the price of fish. I've always remembered that. I do want to change the price of fish."

Questions are being been asked after reports of the failure of several outsourcing giants - including G4S, A4E, Atos, Serco and Capita - to deliver lucrative public service contracts.

With public sector contracts up for tender this year estimated to be worth £4.2bn, there's a lot for the private sector to play for.

Yet, currently two outsourcing companies - G4S and Serco - have been found by the Justice Secretary to have overcharged the government by tens of millions of pounds, having been caught out charging for tagging people still in prison, dead or not in the UK.

This tagging scandal highlights an almost complete disregard for the government's challenges to private sector failures, failures committed at the expense of - and in many cases, to the detriment of - UK taxpayers.

Speaking to the Financial Times recently, the chief executive of Capita, Paul Pindar, referred to the fraud investigation into Serco's and G4S's electronic tagging as a 'distraction', pointing to the eagerness of the 'guys in central government' (including Chief Procurement Officer, Bill Crothers and Cabinet Office Minister, Francis Maude) for the private sector to deliver public service contracts.

The Justice Secretary, Chris Grayling is now attempting to legally exclude G4S from bidding for further tagging contracts and has referred the fraud allegations to the Serious Fraud Office.

He too, will have his work cut out for him, as G4S has been consulting international legal firm Linklaters for the last few months. Linklaters is the firm recently criticised by Sun journalists for allegations of its role in their arrests, and which 'helped' G4S deal with its failure over the Olympic contract last year.

In the meantime, both the public and the voluntary sector look on aghast as appalling news of rapes, deaths and investigations connected with G4S contracts hit national and international headlines nigh on daily.
Worse still is the continuing puzzle of why such failures too often go unpunished.

We watch with interest, along with Margaret Hodge MP, to see if a select committee can change the 'price of fish' and finally hold the private sector to account.