Exclusive: Labour would strip controversial firms G4S and Serco of lucrative contracts
Party said it will try to ‘unpick’ £6bn in outsourcing deals
Controversial public sector outsourcing firms such as Serco and G4S face being stripped of their lucrative Government contracts if Labour wins next general election.
Senior party sources told The Independent that they would have a “long, hard look” at the contracts, which are worth more than£6bn.
At the same time shadow justice minister Sadiq Khan said he would “rip up” any contracts he is asked to sign as part of coalition plans to outsource the probation service.
He added that even those contracts that had got under way by 2015 would be “forensically examined” by an incoming Labour government in an attempt to find ways to “unpick” them. Ironically it was under Labour that companies such as Serco, G4S and Capita dramatically grew in size – benefiting from generous outsourcing contracts across the public sector. But sources close to Ed Miliband said he was increasingly concerned that they were not providing “better competition” or “driving down” prices as had been intended at the time.
“This is not ideological but we intend to have a long, hard look at these contracts,” the source said. “Our concern is that what we have in this country now is an oligopoly of a few companies that are not competing effectively and are providing poor value for money for the taxpayer.”
A recent government investigation into contracts held by Serco and G4S found evidence of “inconsistent management” in 22 out of the 28 deals across eight government departments and agencies. One of the first areas to be reviewed by Labour will be the justice system in the wake of the investigation into fraudulent over-charging by Serco and G4S in criminal tagging contracts.
Mr Khan is opposed to the Government’s plans to outsource the probation service – even after Serco and G4S ruled themselves out of the bidding. They will still be able to play a “supporting role” to other bidders.
The new private contracts are due to start at the end of 2014, but Mr Khan said that if there are delays, they could become caught up in the pre-general election purdah period during which contracts could not be signed.
“I warn those involved in bidding that if Labour wins the next election, and these contracts land on my desk needing my signature, I will not put pen to paper. I’ll rip them up.”
Mr Khan added that while he could not commit to reversing the changes if they had been signed – because of the prohibitive cost of extracting the government from them – he would do everything he could to end them.
“I say to companies that are thinking of getting involved – you’re on notice. I’ll be painstakingly forensic in scrutinising any contracts I inherit to find the slightest opportunity to walk away from them without lumbering the taxpayer with a huge bill. Don’t think this is a done deal just because this Government is obsessed with privatising probation.”
Emergency call 'started off dumb, but got pretty serious'
Thought you'd seen it all after the Jeremy Paxman interview?
Greatest mystery about the hit BBC1 show is how it continues to be made at all, writes Grace Dent
Far-right organisation has defended its actions on Facebook
Animal welfare charities have urged the boy band to cut the scenes
Argentinian scored 'rabona' wonder goal for Tottenham in Europa League – see it here
- 1 This 'woman calls police to order pizza' story isn't going where you're expecting
- 2 Watch what happened when food critics were unknowingly served McDonald's
- 3 Jimmy Carr's controversial Oscar Pistorius joke goes a bit too far at the Q Awards
- 4 Ottawa shootings: Bruce MacKinnon's cartoon is the perfect tribute to soldier Nathan Cirillo
- 5 Of course, teenage girls need role models – but not like beauty vlogger Zoella
Isis releases first video showing the stoning of woman accused of committing adultery as her father shouts 'don't call me Dad'
FCKH8: Provocative anti-sexism video showing young girls swearing reinstated by YouTube
Diwali: What is the festival of lights – and how is it celebrated around the world?
Jimmy Carr's controversial Oscar Pistorius joke goes a bit too far at the Q Awards
Ottawa shootings: Bruce MacKinnon's cartoon is the perfect tribute to soldier Nathan Cirillo
Of course, teenage girls need role models – but not like beauty vlogger Zoella
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Support for EU membership 'at highest level since 1991' with most Brits wanting to stay 'in'
Thousands with degenerative conditions classified as 'fit to work in future' – despite no possibility of improvement
Residents should throw a street party and mix with immigrant neighbours, councils told
Attacks on 'Ukip Calypso' show how skewed people’s priorities are
£55 - £65 per day: Randstad Education Cheshire: Are you looking to work in Edu...
Negotiable: Randstad Education Liverpool: Job opportunity for a nursery manage...
£21000 - £35000 per annum: Randstad Education Chelmsford: EYFS Teachers - Benf...
£4848 - £33600 per annum: Randstad Education Manchester Secondary: Outstanding...