G4S deal

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I notice that the £284 million new deal private security firm G4S struck with the (Tory) Government was, in effect, that they would get £20,000 per security employee, for each of the 13,700 security staff they promised to supply (but will fail to supply) for the Olympics. We all now know how little training and vetting those staff are getting.

But my question is - why was the deal ever made in the first place? G4S are paying those staff £6.50-£8.50 per hour (after promising £14 per hour, according to one potential employee.) Three weeks full-time work at 40 hrs per week will earn each security employee a maximum of about £1,000 each.

So, where does the other £19,000 go that we the British taxpayers are paying for each of them? How on earth could this have been thought a good deal for the British public?

I imagine G4S are generous Tory party donors but is there any other explanation?

Comments

Tris Stock said…
It's a disgrace. How is it we allow this sort of thing to happen? No, really?
July 14, 2012 at 9:12 PM
Anonymous said…
It seems likely to me that G4S will incur other legitimate costs. e.g. paying the people who do the recruiting and training, management costs etc...

Also, do we know if these people are being paid for their time while training? Who is supplying uniforms and equipment?

Are G4S tory party donors? Or are you just making that up?

In any case it seems to be a good deal because now the army are taking over the slack (and they'll probably do a better job) and G4S are footing the bill for that while also having to pay a huge fine.
July 16, 2012 at 11:10 AM
wombat said…
(Dunno what happened to a previous detailed comment but the punchline was this:)

G4S look to be making a loss of £50Million on the contract. More Millions than that has been wiped of their stock market value.

Looks like either they didn't donate enough or their competitors did a better job of lobbying!
July 16, 2012 at 9:56 PM
Csiki Attila-József said…
Probably something similar I have seen in Romania: big firm gets contract, gets big money, then subcontracts a hundred smaller firms to do the job for less than half the price, does sh*tty administrative job and skims the difference as "administrative costs" and "risk deposit" (in case of any unforeseen legal mishap) that they wont pay out to no one, it's theirs...
Or something similar.
July 17, 2012 at 7:11 AM
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