Industry news

The Serious Fraud Office (SFO) has confirmed it has launched a criminal investigation into government contracts with G4S and Serco over the provision of electronic tagging services.

The Ministry of Justice has called for the SFO to probe G4S because it refused a further full audit after the results of the initial audit found substantial disparities between tagging and charging, that led to over-billing by both companies of Government worth over tens of millions of pounds.

G4S confirmed today that it had received notice that the director of the SFO has opened an investigation into the ‘contract for the provision of electronic monitoring services which commenced in April 2005 as amended and extended until the present day’.”

Serco, subject to a full audit by accountancy firm PwC following the announcement of the initial audit in July confirmed it will also co-operate fully with the SFO investigation – which could lead to fines or prosecution.

Neither company can win any further British government work until a second investigation run by the Cabinet Office into contracts it has with each company, whose results are expected at the end of November, is completed.

French based Steria Limited has been awarded a 10 year contract worth as much as £1 billion.

The contract was awarded to Steria’s Hemel Hempstead division, the conformation follows the company being named as the Cabinet Office's preferred bidder .

The contract will see Steria deliver a new ICT framework and the delivery of business technology services, designed to achieve economies of scale and increased efficiencies.

The contract will see the creation of a new joint venture business called Shared Services Connected Ltd (SSCL), which Steria will run as a shared service with the government.

Steria said: “SSCL will invest in technologies and skills to create UK centres of excellence, which will not only improve levels of service, but will stimulate innovation, create high-value jobs and develop skills in the UK”.

The move to select Steria has angered public services unions, with members of the Public and Commercial Services (PCS) union striking in protests of plans to outsource services as part of the contract.

Public services union to strike over outsourcing plans

The UK government has announced the creation of a new data infrastructure programme, the National Information Infrastructure (NII) will allow users to access real-time public data as part of a move to increase transparency and government accountability.

The development of the NII is in response to an independent review into new ways to use information held by the public sector.

Peter Lawrence, deputy director of transparency and open data at the Cabinet Office, said: “We’ve developed a process to identify those datasets that are most useful to either business, or civil society, or government, to improve growth, public services and citizens’ lives”.

The announcement of the NII came as the Prime Minister urged UK businesses to follow an open data and transparent model.

David Cameron urges businesses to publish open data

Cabinet Office minister Francis Maude has urged SMEs to place pressure on the government and demand increased transparency and accountability from the public sector procurement process.

The move to increase the government’s procurement transparency would increase completion and help SMEs in bidding for contracts.

Increased accountability and openness would also restrict the dominance of enterprise level companies over public sector contracts, while encouraging the use of SMEs to deliver specialist services.

Mr Maude said during an Open Government Partnership summit, that: “One is the small business arena, who get frozen out of a lot of government contracting. It’s just too difficult. They should be being very demanding.”

Government select committee hears from outsourcing experts

MoJ tenders for £108 million ITO contract as part of future procurement strategy

The UK prime minister has urged UK businesses to follow an open data and transparent model.

David Cameron has asked UK businesses to move to display and publish data as part of a move to encourage transparency and prevent corruption and tax avoidance.

The announcement came as he attended the Open Government Partnership Annual Summit in London, as Mr Cameron revealed plans to create a central register, containing the details of company owners.

Mr Cameron said: “For too long a small minority have hidden their business dealings behind a complicated web of shell companies, and this cloak of secrecy has fuelled all manner of questionable practices, and down-right illegality”.

The call for the display of open data comes as Cabinet Office minister Francis Maude urged SMEs to ask for increased transparency and accountability from the government’s procurement process.

Francis Maude calls for SMEs to put pressure on the government procurement process

Government select committee hears from outsourcing experts

Comptroller of the Currency of the United States, Thomas Curry, said in a statement that financial institutions need to take care regarding the outsourcing of services to third parties.

The warning follows action by the Office of the Comptroller of the Currency (OCC) and the Consumer Financial Protection Bureau, against Capital One Financial, over misleading practices employed by an external call centre employed by the company.

Mr Curry said: “"We have concerns regarding the quality of risk management on the growing volume, diversity and complexity of banks' third-party relationships, both foreign and domestic".

The warning was directed at contracts with third part vendors that lasted more than a year, with fears of a rise in complacency.

The OCC said that banks should move to implement a risk management and assessment plan when employing outsourced services.

Banking security is questioned after significant losses in India

New U.S. federal budget sees a decline in funding after inflation

G4S have entered a bid for a security contract for the 2014 Commonwealth Games hosted in Glasgow.

The bid relates to safety stewarding, one of the services up for tender by the Games, alongside security guarding.

Rather than employing a single security contractor the Commonwealth organisers have chosen to employ a shared framework, consisting of multiple contractors in order to avoid any mishaps.

G4S said: “as the existing provider of stewarding services at a number of Games venues, we are participating in the process to be included in the framework to continue to provide these services during the Games.”

Chairman of the Home Affairs Select Committee Keith Vaz, said that G4S should not be bidding for contracts following its failure to provide enough staff for the London Olympics. The bidding application comes despite G4S bosses admitting that its handling of the London 2012 Olympic Games had been a “shambles”.

The news of the bid follows criticism of G4S after members of its staff, in charge of running a South African prison, were accused of abuse.

The South Africa have now moved to take over the facility after staff were accused of subjecting staff electric shocks and forced injections.G4S says it is investigating the allegations but has pointed to labour disputed at the cause for a surge in violence at the prison. The South African government have now launched an investigation into the prison, with preliminary findings set to be presented at the end of October.

G4S hit buy pay dispute at GCHQ

G4S pulls out of electronic tagging renewal bid after overcharging controversy

A government select committee meeting to discuss local government procurement heard from leaders and experts in the fields of procurement and outsourcing, who advised on how the public sector should look to develop contracts and procurement services in the future.

The committee heard from Kerry Hallard, chief executive officer at the National Outsourcing Association, who detailed how contract maturity and experience was now allowing public services to effectively employ outsourced services potential, and identify the risk and benefits. She said that a increase in skills and experience allowed the public sector: "to walk away when they think outsourcing is the not the right solution and they are not just rushing in, in some sort of goldrush."

Peter Challis, national officer at Unison, the UK’s largest trade union,said: “Local authorities need to review the services they are providing and see whether efficiencies can be secured; they need to benchmark that against the competition and then, if there is a gap, there should be a competitive exercise”, adding that, “local authorities need to undertake regular service tests.

Prime Minister acknowledges public sectors shortcomings when outsourcing

Major foods products company Bernard Matthews have achieved savings of 21 per cent through the implementation of a new eSourcing platform.

The platform supplied by Wax Digital alongside strategic category management advice from EAA Consulting, has allowed the foods company, famously known for its turkey products, to drive down supplier costs.

“One of our key objectives as a business is to grow the consumption of turkey in the UK. To help achieve this, the procurement team is always on the lookout for innovative ways to increase the quality of service and value we receive from our suppliers, said Richard Southgate, procurement director at Bernard Matthews.

He added that: ““Potential cost savings aren’t our only goal. Using the web3 eSourcing platform allows us to identify clear specifications and the standards we require from our suppliers at the 1outset. We were also keen to establish a true market value for the products or services we source, evaluate like-for-like comparisons and determine clear SLAs from the marketplace.”

Daniel Ball, business development director, Wax Digital said: In what can be quite a traditional sector it is great to see a leading company like Bernard Matthews adopt a progressive approach to supply chain management, calling on the best tools and advisors to help control costs, reduce risk and drive competitive advantage.”

Chinese meat processor company buy U.S. pork giant

The Sourcing Specialist – Recruitment and temporary staff

Australian health services to move away from shared services

A ministerial review of health services based in Australia, Victoria have decided that the past practices of centralised shared services should be moved away from, instead promoting a move to empowering local health boards.

Health boards will now be in charge and accountable for decisions relating to all IT and communications technology.

The ministerial review follows a prolonged period of setbacks and problems spanning a decade from the implementation of a state-wide shared services strategy for IT services.

The Victorian Minister for Health David Davis called that past strategy wasteful and misguided one-sided fits all strategy. The review added that the past strategy had the effect of forcing small health services into purchasing services that provided unnecessary functionality.

Fujitsu signs $10 million contract with Australian Child Protection