serco has signed a contract to run a new London prison, in the face of concerns that public spending cuts could mean fewer deals for support services firms.
Serco, which runs London's Docklands Light Railway and detention centres in Australia, said its consortium had signed a £415m contract with the Ministry of Justice to build and manage the new Belmarsh West prison in Woolwich, south-east London. "Construction works will begin immediately, with completion expected in the first half of 2012. Equity and debt finance has been secured from third parties," Serco said.
The prison will be built with Serco's construction partner, the Swedish firm Skanska, for whom the deal is worth £100m. The consortium also involved voluntary sector organisations Turning Point and Catch22.
Serco said last year that its consortium had been named the preferred bidder to run the prison along with another jail in Liverpool. The Belmarsh contract will run for 26 years and six months.