Last week was a bad week for G4S, Serco and the UK government's privatisation drive. The Justice Minister called in the Serious Fraud Office to investigate tens of millions of pounds overcharging by G4S and Serco on tagging contracts. MPs criticised Serco for falsifying GP out-of-hours performance data and silencing whistle-blowers. An inquest Jury found that Jimmy Mubenga was "unlawfully killed" after being restrained by three G4S guards.
The government launched a review of all government contracts with Serco and G4S. Ministers insisted private sector involvement was still valuable. Chris Grayling was "absolutely astonished.”
Less convinced, NHS commentator Sharon Avraham asked “How many more government contracts will they get? How about more NHS contracts?”
In fact, largely unnoticed, G4S already have plenty of such contracts.
Their website boasts that it "provides services to around 200 hospitals and healthcare centres in the UK alone.”
They recently told their investors that internationally they are increasing their focus on healthcare, which gives them “higher gross margins” than the “traditional mainstream vanilla services we offer”.
Barry Sheerman MP asked in May for the value of contracts the Department of Health held with G4S. Junior Minister Mark Hoban replied that last year it was £790. A miniscule sum.
But Sheerman asked the wrong question.
Diane Abbott MP had earlier asked “what contracts the NHS holds with G4S?”
Junior Health Minister Daniel Poulter replied:
“The Department does not centrally collect information on the contracts which individual national health service bodies hold with private sector companies.”
In fact, our research reveals that G4S already has tens if not hundreds of millions of pounds-worth of contracts with the NHS.
What does G4S do in the NHS?
Outsourced cleaning, catering and portering services provide a huge chunk of G4S’s NHS cash. G4S is paid to provide these services by hospitals from Sunderland to Hertfordshire. It has a £12million, 6 year contract at Liverpool women’s hospital, and a £4.5million a year contract with South Warwickshire NHS Trust. At Birmingham Heartlands NHS Trust it nets £6.7million a year. And it recently picked up a similar contract for four hospitals in the Pennine Acute Hospitals NHS Trust in Manchester, earning it £56million over 5 years.
At North West London Hospitals Trust - currently facing the loss of several A&E departments due to a funding squeeze - virtually all areas of support services from cleaning, portering and security to reception and catering are contracted out to G4S. It also supplies a ‘premium service’ with ‘dedicated hostess, chef and housekeeping services’ in private patient units in 2 of the North West London NHS hospitals.
G4S is a big beneficiary of the Private Finance Initiative
G4S has been heavily involved in the hugely expensive Private Finance Initiative, including the orthopaedic and cancer centres at the Oxford University Hospitals NHS Trust. It runs health centres under the LIFT scheme (equivalent to PFI) across large parts of London including East London and the City; Bexley, Bromley and Greenwich; and Brent, Harrow and Hillingdon; as well as in Wolverhampton and Walsall.
G4S provides patient transport services for NHS Trusts including Barking, Havering & Redbridge; Surrey; St George Healthcare NHS Trust (£2.7million a year), and Epsom & St Helier (£3.5million a year).
At St Georges, according to Private Eye G4S pays below the minimum rate for non-emergency ambulance drivers, turnover is high, morale low, and training insufficient. One staff member told Private Eye “There really shouldn’t be a role for G4S in the health service. G4S and care do not belong in the same sentence.”
At Epsom & St Helier NHS Trust, where a double amputee died when his unsecured wheelchair tipped over as he was being transported to hospital in a G4S ambulance, an inquest found that G4S employees “were not sufficiently trained in the safe transportation of passengers by ambulance”.
G4S is moving into prison healthcare, ‘forensic and medical services’, drug treatment and mental health. It “provides security for mental health services for Tower Hamlets, East London, Oxfordshire and Buckinghamshire”.
G4S is being paid £50,000 a year by Gloucestershire’s Mental Health 2gether NHS Trust to assess mentally ill patients. At Northumberland, Tyne and Wear NHS Foundation Trust G4S is providing “planned and reactive secure transport for patients suffering from mental ill health”.
Last month West Midlands NHS handed G4S a contract to provide medical examinations and counselling for rape victims. Rape Crisis England expressed concern that the move “will lead to a focus on cost-efficiency above the needs of sexual violence victims.” NHS Torbay hired G4S to provide health services for children who’ve survived sexual abuse.
Staff have told me that mental health staff are being replaced by security staff, particularly on night shifts.
In A&Es across the land, as queues lengthen and medical staff are cut, security guards are picking up the slack as frustrated tempers fray.
G4S aren’t just ‘securitising’ patient care, but staff too. Low paid G4S cleaners and porters at Mile End hospital are forced to hand over personal data and use biometric clock-in machines.
Why is the world’s largest private security company, involved in countless cases of human rights abuses both in the UK and internationally, being allowed to make profits from providing healthcare to some of the UK’s most vulnerable children and adults?
An honest conversation
In April 2012 G4S won a 5 year contract to provide Non-Emergency Patient Transport to embattled Lewisham hospital. How much was the contract worth? A local resident submitted a Freedom of Information Request. The reply came in: to reveal the value would “breach commercial interest”. I kept on digging. It turned out that Lewisham was paying between £127,000 and £146,000 a month for these services.
How much are Barking, Havering and Redbridge paying G4S for facilities management services? They won't say. “This could prejudice the commercial and/or financial interests of the Supplier…and become a barrier to fair trade.”
So how do we know we're getting value for money?
John Harris, writing in the Guardian, said recently “Were Whitehall to call in and finally audit the huge private-sector contracts that now blanket the entire state, the savings could be towering”.
A new report from CHPI highlights the huge potential for fraud in our increasingly outsourced healthcare system. Overbilling by private healthcare suppliers cost the US taxpayer $54 billion in 2009.
The impact assessment for the Care Bill notes, “there are incentives for providers to supply false or misleading information”.
Reviews of government contracts that have been restricted to a narrow definition of fraud have a history of running into the sand, after they have served the purpose of making the minster look tough.
The Cabinet Office review of all government contracts held by G4S and Serco is unlikely to go far enough. It will be outsourced to PwC, who have had a role in brokering many outsourced contracts, particularly PFI schemes. It is not clear if it will be made public, as called for by shadow justice minister Sadiq Khan.
Nor is it clear whether the review will include Serco and G4S’s contracts with the NHS, now being managed by unaccountable and inexperienced Clinical Commissioning Groups or sub-contracted by struggling NHS Trusts. Perhaps we will just find out if that £790 was well spent.
The National Audit Office will also review government procurement practice more generally, Grayling announced. But will we get the kind of review Harris suggests - a thorough and public review of the outcomes of outsourcing, including in the NHS, and whether they match up to the promises? We already spend £10billion on trying to contract manage the NHS ‘marketplace’. In the week we were told we needed an ‘honest conversation’ about a supposed multi-billion NHS funding gap, perhaps we should be asking - is it time to end the 30 year experiment in NHS outsourcing?
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