MPs: Ban Games debacle firm G4S

The private company at the centre of the Olympics security shambles should be the first outfit on a Government blacklist of high-risk firms that have failed to deliver, MPs have said.

Politicians repeated their calls for the firm to give up its £57 million management fee and said it should pay those people it trained but then failed to use due to management failings.

The blame for the debacle which saw thousands of troops brought in at the last minute to help secure the Games lies "firmly and solely" with G4S, a damning report found.

Exonerating Olympic organisers Locog, the Home Office and everybody else, the Commons Home Affairs Select Committee said even G4S agreed it was the only one at fault.

The firm, which has already taken a £50 million loss on the Games, must now "look to the bigger picture, and its long-standing relationship with its biggest client in the UK: the taxpayer", the committee's report said.

"By waiving the £57 million management fee in its entirety, a small fraction of the £759 million that it receives from the British taxpayer every year, G4S would send a strong signal to the public that it is serious about offering fair and reasonable redress when things go badly wrong."

The move would help draw a line under its failure, it added.

"Parliament and the general public would regard it as absurd for the company to be claiming a management fee which was clearly negotiated on the basis of the delivery of services which were not delivered."

The "apparent reluctance" of G4S chief executive Nick Buckles to grasp this point shocked the committee, the MPs added.

They went on: "The Government should not be in the business of rewarding failure with taxpayers' money.

"We recommend that the Government establish a register of high-risk providers, who have a track-record of failure in the delivery of public services.

"This would provide a single source of information for those conducting procurement exercises about companies which are failing or have failed in the delivery of public contracts."

In future, Government departments, police forces and other public bodies "must not place too much weight on a company's size and reputation alone", the report added.

And people who were ready and willing to work but not offered a time and place to start should be paid for the training they attended, the MPs said.

"We can understand a company wishing to recover costs if an individual benefits from training but then fails to turn up for work without good reason, but when the lack of shifts work is entirely due to the company's failure to provide employment, this is an entirely different matter.

"We expect the company to make public a means by which people can be recompensed in such circumstances and to be quick and generous in settling such claims."

G4S only told organisers two weeks before the start of the Games that problems with its scheduling system meant it could not guarantee it would be able to supply enough guards to secure the Olympics.

The firm, which has contracts with 10 central Government departments and agencies and 14 police forces in England and Wales, was contracted to train and accredit 10,400 staff and manage 13,000 others.

Some 4,700 extra servicemen and women were drafted in at the last minute, taking the military's contribution to 18,200 personnel, and more police were needed to boost venue security too.

The day after the Olympics closing ceremony, August 13, was the first date on which the number of staff supplied by G4S met Locog's demand, the report found.

A Cabinet Office spokeswoman said: "Since day one this Government has been determined to reform how we spend taxpayers' money on goods and services.

"That's why we have introduced unprecedented and comprehensive reforms across all areas of procurement.

"In June we announced that - like many businesses - we will take the performance history of our suppliers into account during the procurement process.

"While we will not publicly name the companies involved it will mean that suppliers with poor performance may find it more difficult to secure work with government in future."

Matthew Sinclair, chief executive of the TaxPayers' Alliance, said: "The Home Affairs Select Committee is absolutely right to say that the Government must never use taxpayers' money to reward failure.

"Far too often those responsible for catastrophic errors involving large sums of public cash are never properly held to account.

"It is vital that G4S pays the price for its mistakes whilst ministers must ensure that not a single penny of taxpayers' money is used to clear up the mess G4S caused."

Shadow home secretary Yvette Cooper said the report showed "the huge scale of G4S's failure and how the company seemed willing to dupe the Home Secretary about the numbers they could provide".

"It is ridiculous that G4S only reached their contracted numbers after the closing ceremony, and G4S should give up their management fee," she said.

"But the Government also needs to show it has learnt lessons from G4S and the Olympics."