Serco Justice System

Richard Burgon Excerpts

Thursday 4th July 2019 Commons Chamber

[Richard Burgon (Leeds East) (Lab)]

(Urgent Question): To ask the Secretary of State for Justice if he will make a statement on the role of Serco in our justice system following the decision of the Serious Fraud Office.

[The Parliamentary Under-Secretary of State for Justice (Paul Maynard)]

Thank you for granting this urgent question, Mr Speaker.

We very much welcome the fact that, subject to court approval today, the Serious Fraud Office has reached a conclusion in its investigations of Serco. These historical contracts ended in 2014 and were awarded as long ago as 2004. The agreement allows the parties to draw a line under the matter. Following the successful conclusion of this process, we see no reason why Serco should not continue to be a strategic supplier to Government and to compete for Government contracts.

We conducted an investigation of the matters raised in the agreement announced yesterday, and we are content that matters were resolved in 2013-14, when Serco reached a financial settlement of £68.5 million with the Ministry of Justice and undertook an extensive self-cleaning exercise.

Although we deplore the wrongdoing identified in the deferred prosecution agreement announced yesterday, we have confirmed that, since 2013, Serco has thoroughly overhauled its management, governance and culture and that these changes continue to be effective today. Serco is, and will continue to be, a strategic supplier to Her Majesty’s Government, working across the defence, justice, immigration, transport and health sectors.

[Richard Burgon]

Thank you, Mr Speaker, for granting this urgent question.

In 2013, evidence came to light suggesting that Serco may have been fraudulently charging the Government on its offender tagging contract, including for monitoring people who are dead. Serco had to pay back tens of millions of pounds to the Government and lost the tagging contract. A subsequent Serious Fraud Office investigation has seen Serco fined £19 million for fraud and false accounting linked to those prisoner tagging contracts. Does the Minister agree that this is just the latest scandal to hit our justice system involving the private sector in recent months? The private probation contracts were terminated early, HMP Birmingham private prison was returned to the public sector and new research shows disproportionate violence in private prisons. We have also seen the collapse of Carillion, meaning that prison maintenance works were brought back in house. Each time we are told it is an isolated case, so will the Minister finally admit that in reality it is a systemic failure?

Serco has £3.5 billion of current contracts with the Ministry of Justice. Given the findings of the Serious Fraud Office, will the Minister commit to a special audit of all existing Serco justice contracts? Those contracts include running prisons. The Government are currently receiving bids for a new generation of private prisons, so can the Minister assure me that Serco will not be allowed to run these new private prisons?

Finally, there is a current Justice Minister, not here today, who once worked for Serco as its chief spin doctor. Will this Minister guarantee that that Justice Minister has had no involvement in overseeing any current Serco contracts and will have no role in handing over any future lucrative contracts to his former employer?

[Paul Maynard]

The hon. Gentleman behaves as though this is somehow a new piece of information that has come to light. In fact, this is a very old piece of news, dating back to 2013-14, that has a very long tail. The SFO has conducted a very complex investigation into the fraudulent aspects of this behaviour, but in 2013-14 there was a vigorous effort on the part of the Government to investigate what Serco was doing and how it was managing these contracts that led to significant cultural change.

I am afraid that all we have heard today is a predictable ideological tirade of hostility towards the role that the private sector plays within our justice system, and it simply does not stand up to scrutiny. The hon. Gentleman raises the spectre of Carillion once again. Carillion was a very different affair; it cannot be compared at all with what is going on with Serco.

The hon. Gentleman also makes a point about the Under-Secretary of State for Justice, my hon. Friend the Member for Charnwood (Edward Argar), who has no Serco contracts within his ministerial responsibility—that is a complete red herring. The Ministry has already begun an audit into the contract for prisoner escort and custody services that Serco currently holds. We took action back in 2013-14, and this has transformed not just how the Ministry of Justice conducts its private sector contracts, but Government as a whole. We are confident that the ongoing work will ensure that we continue to deliver high-quality services at the best value for the taxpayer.