G4S accused of misleading Government over London 2012 security fiasco
Friday, 21 September 2012
September 21 - Security firm G4S has been accused of misleading the British Government and top London 2012 officials over staff recruitment for the Olympics and Paralympics and must waive its management fee, a new report published today said.
The Home Affairs Select Committee, in its report out today, describes the company's failure to meet targets in time for the opening of the Games as a "significant matter of public concern".
It recommends G4S should forego its £57 million ($93 million/€71 million) management fee, to send a strong signal to the British taxpayer that it is serious about making good for its mistakes.
The company has already agreed to pay up to £50 million ($81 million/€62 million) for the deployment of thousands of military personnel and police as result of its failures.
The report also recommends that G4S, the world's largest security firm, should make ex gratia payments by way of apology to those applicants who successfully completed the training and accreditation process but were not scheduled for work because of their management failings.
"The largest security company in the world, providing a contract to their biggest UK client, turned years of carefully laid preparations into an eleventh hour fiasco," said Keith Vaz, chairman of the influential Home Affairs Committee.
"The data the company provided to the Olympic Security Board was at best unreliable, at worst downright misleading.
"Twenty-four hours before they admitted their failure, [the company chief executive] Nick Buckles met with the Home Secretary [Theresa May] and did not bother to inform her that they were unable to deliver on their contract, even though he knew about the shortfall a week before.
"The Government should learn lessons from this experience and establish a register of high-risk companies that have failed in the delivery of public services."
The report is a further huge embarrassment for the company who have public sector contracts in the UK worth £759 million ($1.2 billion/€949 million).
"Far from being able to stage two Games on two continents at the same time, as they recklessly boasted, G4S could not even stage one," said Vaz, referring to an interview managing director of G4S Global Events, Ian Horseman Sewell, gave in in July, just a few days before the Games started.
"G4S should waive its £57 million ($93 million/€71 million) management fee and also compensate its staff and prospective staff who it treated in a cavalier fashion."
London 2012 has so far paid £90 million ($146 million/€112 million) of the £237 million ($386 million/€296 million) contract and earlier this month insisted the remainder would have to be negotiated.
In a statement released following the publication of the report G4S accepted responsibility for its failure to deliver in full on the security contract, but reaffirmed its right to the management fee, which relates to set-up costs for the operation.
Vaz advised London 2012 to negotiate "robustly" with G4S in the public interest on the remainder of the contract.
The total security contract for the Olympics is worth £284 million ($462 million/€355 million), including work already paid for in 2011 by the Olympic Delivery Authority.
The Committee said it had received submissions from applicants that wanted to work for G4S at the Olympics with many explaining that they had been dropped without explanation despite passing an interview and vetting stage.
Others were accredited and trained but had no work when the Games started.
"One applicant from Northern Ireland says that he reported for work in Glasgow as requested but was sent home because G4S had run out of uniforms," the report read.
G4S, which eventually supplied 7,800 guards for the Games, said it had already started compensating some of the staff affected.
"G4S has already agreed a process, in conjunction with the GMB Union, for compensating those candidates who completed training and accreditation or made a significant journey through the recruitment process, but were unable to work at the games," the company said in its statement.
A Home Office spokesperson said: "The several years of testing and refining Government and operational plans [for London 2012] paid off.
"We welcome today's report which highlights how the far-sighted planning of officials at the Home Office, LOCOG and other partners enabled a 'robust contingency' plan to be swiftly rolled out, thereby delivering a safe and secure Games that London, the UK and the world enjoyed so much.
"G4S will only be paid for the services delivered and will meet any additional police or military costs."
To read the full report click here.
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September 2012: Home Affairs Select Committee to grill G4S chief and Coe on London 2012 security
August 2012: G4S withdraws from bidding for Brazil 2014 and Rio 2016 security contracts after London 2012 shambles
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