Security firm G4S to repay tagging scandal £24m (€28.5m)
Published 19/11/2013 | 11:52
Security firm G4S has apologised and offered to repay more than £24m (€28.5m) it overcharged taxpayers for the electronic tagging of offenders.
It admitted its part in the scandal - which is being looked into by the Serious Fraud Office - which included bills for monitoring criminals who had died.
But it insisted an independent review it commissioned "has not identified any evidence of dishonesty or criminal conduct by any employee".
G4S refused to co-operate with a forensic audit of its work - and that of fellow contractor Serco - which a public spending watchdog revealed had already cost the Ministry of Justice (MoJ) more than £2m.
The firm said it now accepted it had "wrongly considered itself to be contractually entitled to bill for monitoring services when equipment had not been fitted or after it had been removed".
It said: "This billing practice ... was not consistent with the contract or G4S's values and the company has apologised to the Ministry of Justice and issued credit notes totalling £23.3m for amounts incorrectly billed between 2005 and May 2013.
"A further credit note of £0.8m will be issued for billings for the period from June 2013 to date."
There was no evidence that it extended to any of its other Government contracts, said the firm, which has faced repeated criticism of its performance, not least over security for the 2012 Olympics.
G4S group chief executive Ashley Almanza said the offer was "an important step in setting this matter straight and restoring the trust which has been earned by our many thousands of committed and hard-working employees over many years".
"The way in which this contract was managed was not consistent with our values or our approach to dealing with customers. Simply put, it was unacceptable and we have apologised to the Ministry of Justice.
"As part of a wider programme of corporate renewal, we have changed the leadership of our UK business and we are putting in place enhanced risk management and contract controls.
"We remain committed to working with the ministry and the UK Government to resolve this matter and to provide enhanced oversight of service delivery and contract performance."
The firm said it was ready for further negotiations with the MoJ if the audit concluded that it had overcharged by more than the sum offered.
An audit by big four accountancy firm PricewaterhouseCoopers (PWC), launched in May, revealed that overcharging began at least as far back as the start of the current contracts in 2005 - but could have dated as far back as the previous contracts in 1999.
Auditors discovered that the firms had charged the Government for tagging offenders who were back in prison, had had their tags removed, had left the country or had never been tagged in the first place but had been returned to court.
The Government has handed over material from the PWC audit of Serco to the Serious Fraud Office while G4S was referred to it after declining to take part in the audit, which included looking at email trails between top executives.
The shock revelations sparked a Government-wide review of all contracts held by Serco and G4S.
G4S UK and Ireland chief executive Richard Morris will face questions from MPs over the scandal tomorrow when he appears before the Commons public accounts committee.
The National Audit Office said the audit found examples of billing continuing "for months or years" after tags had been removed and even when it had never been carried out in the first place.
The taxpayer was also billed several times for the same offender when they were subject to more than one tagging order, it said in a note to Parliament about the findings.