Question to the Ministry of Justice:

To ask the Secretary of State for Justice, if he will make it his policy that any contracts signed with private sector companies until May 2015 for the provision of probation services do not contain clauses that provide for compensation for loss of profit in the event of the termination of those contracts; and if he will make a statement.

Voluntary termination is a standard clause in government contracts. Voluntary termination compensation would only be payable to the contractor if the contract is terminated through no fault of the contractor.

The purpose of the clauses is simply to ensure that in the event of termination for reasons beyond their control, bidders are left in no worse a position than they would have been had the contracts run their course.

It would not be acceptable to expect providers to bear this risk, and many would price it into their bids, which would increase the costs of the contracts and result in poor value for money for the taxpayer.