PAC Urges Government To Reform Outsourcing Approach

The Public Accounts Committee (PAC) has criticised the government’s ability to negotiate and manage outsourcing contracts, stating improvement is needed urgently.

PAC chairwoman, Margaret Hodge, questioned the lack of openness around Whitehall arrangements and said allowing organisations such as business services company Serco and security firm G4S to overcharge for contracts was unacceptable.

The PAC chairwoman has told the government it must “get its house in order,” while calling for three measures which she claims will promote transparency, recorded in a new PAC report.

These include an extension of Freedom of Information to contracts with private providers, access rights for the National Audit Office and a requirement for contractors to open their books to officials.

Hodge claimed that her suggestions have been accepted by G4S, Serco, IT services company Atos and outsourcing solutions provider Capita. She said this implies that the barriers to transparency lie within government itself.

According to press reports, both G4S and Serco are currently facing fraud investigations for overpriced contract. The former agreed this week to pay over £109m back to the UK government for this reason.

Despite this, Cabinet Office minister Francis Maude, who is responsible for managing government contracts, has claimed the process has already improved.

One example of this, he says, is the intention for most outsourcing arrangements to be published publicly in the future.

“We are turning the super tanker around, but a lot of this is about change of attitude and culture and mind set and that does take time,” Maude claimed.

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