Under-fire Government contractor Serco has proved it is “good at bidding but not at delivery” after withdrawing from an out-of-hours GP contract in Cornwall, according to one of Westminster’s most powerful MPs.
For months former minister Margaret Hodge has questioned Serco’s management of this contract after it was revealed that the company was fiddling figures to meet key performance targets.
Serco staff had claimed that every emergency caller received a face-to-face meeting within 60 minutes when one-in-four did not. However, this controversy was largely missed in the furore which was caused by the group’s involvement in the electronic-tagging scandal.
A report from the Public Accounts Committee (PAC), which the Labour MP for Barking chairs, said earlier this year that Serco was guilty of “inhibiting staff from revealing the facts about out-of-hours service to patients”.
On Friday, Serco took a £17m hit on its clinical-health operations, which included early termination of the Cornwall deal and a write-down of the value of community-care work in Suffolk – also the subject of a PAC probe. In addition, Serco ended a contract to manage Braintree Hospital in Essex.
Mrs Hodge told The Independent: “Serco has been desperate to build a presence in the healthcare market by undercutting [bids on] contracts at a cost to the taxpayer and a loss of service.
“It’s pointless being good at getting contracts and then hopeless at delivering the services,” she added.
Serco said that it had decided to end the contract early in May 2015 and would include estimated future losses in that deal of £5m in this year’s accounts.
Mrs Hodge said that she was “shocked” that the terms of the contract had meant Serco could easily jump but was almost impossible to push.
The results of the review came at the end of yet another tumultuous week for Serco. Just 24 hours earlier, the Government had finally ended Serco and G4S’s involvement in the electronic tagging of people in custody.
The summer’s revelations that the two companies had overcharged the taxpayer by claiming to have tagged criminals who were in custody, abroad or even dead has led from Serco’s very quick fall from grace. Once a member of the elite club of Britain’s 100 listed companies, it is now in the FTSE 250.