The government’s spending with security supplier G4S from 2012 to 2016 has gone up by 29%, but the size of average payments has gone up by 54% and the number of buyers has gone down from an average of 93 per month in 2012 to 78 in 2016. This means G4S’s public sector customer base is narrowing so they will be more dependant on a few key contracts.
In 2016, G4S had its biggest public sector spend, thanks to a £37m payment from the Home Office. However, this may not be good news for the security giant. The company’s asylum accommodation contract with the Home Office has been extended until 2020, incurring losses for G4S of an estimated £57m due to the rising cost of accommodation and number of asylum seekers.1
G4S’s public sector growth from 2012 to 2016 was 29%. During this time, G4S has been dogged by scandals, from failing to provide adequate Olympic security,2 abuse in detention centres,3 mismanagement of electronic tagging4 and prison riots.5 Despite this, its biggest client is the National Offender Monitoring Service (NOMS6), who spent a total of £350.6m with G4S from January 2012 to March 2017. However, the highest NOMS spend was in 2012 at £113.4m, declining to £46.7m in 2016, a 59% drop.
After NOMS, G4S’s biggest public sector clients are the Home Office, DWP and FCO. The Home Office went from spending nothing with G4S in 2012 to £109m in 2016. DWP, spent £27.4m in 2012 rising to to £37.4m in 2017, a 37% increase. The HM Courts and Tribunals Service and UK Border Agency also among its top ten buyers, although neither have spent with G4S since 2013. The biggest percentage increase is with the Ministry of Justice. Its spend with G4S went from £671.4k in 2012 to £12.4m in 2016, a 1742% increase.
86% of G4S spend is from central government, 8% is from local government and 6% from the NHS. In local government spend, most comes from North West, followed by East of England and the East Midlands. The lowest spend is from the North East.
View the slides on Slideshare: https://www.slideshare.net/HelenMcNally2/g4s-government-spending-overview-august-2017.
6 Now renamed Her Majesty’s Prison and Probation Service (HMPPS)