The current fiasco over security at the Olympics and the reported failure of G4S to recruit sufficient staff is serious for the Olympics, London and the UK’s credibility, the security of athletes and spectators, and for an already overstretched police and security/armed forces.
There clearly needs to be a comprehensive enquiry into what went wrong, when and why this happened, and who is responsible.
It would appear from media reports, including interviews with G4S’ own Chief Executive, that the company has made some very big mistakes. G4S has not delivered and admits that it will not meet its contractual obligation to provide over 10,000 people.
Still, the questions that need to be asked of G4S include:
- When did it realise that it was not going to be able to recruit and appoint sufficient qualified people?
- Did it inform its client LOCOG immediately it realised the problem, and if not why not?
- Why did it agree to original and any subsequent variations to the contract specification?
- What financial incentives existed to encourage it to deliver; and what penalties are there for failure to do so?
- How material to the overall contract and overall business of the company are such penalties – eg would it be commercially sensible to incur penalties given the costs of securing extra staff – and what was the trade-off?
- What planning did the company undertake and was this shared with LOCOG?
- What Board-level involvement and monitoring took place?
- Were there commercial incentives to delay recruiting staff to very close to the commencement of the Games in order to save money?
- What evidence of track record was required in the original bid?
- Did the contract make commercial sense in terms of reward, risk and operational reality – and how did the company factor these into its bid and subsequent negotiations?
- What change control has taken place over the life of the contract so far and at what cost to the provider and the client?
- What losses will the company incur as a result of the current problems?
- Will senior executives lose remuneration including bonuses and even their jobs?
The answers to these questions will be important. However, so will the parallel questions which need to be answered by LOCOG as the client and body responsible for the Games and by the Government which is ultimately responsible for security.
The questions for LOCOG and the Government include:
- What stress-testing took place on the proposed number of recruits that a provider had to find and place – in other words, was the number considered practical?
- What evidence was sought that providers, and specifically the selected provider, had the track record, plans, project management, Board commitment and expertise to deliver?
- Was consideration given to having several providers to share the risk?
- What contingency plans were developed and in place before the current level of shortfall in number of recruits was identified?
- Did the client review and sign off on the G4S implementation plan?
- What expertise was available to the client to review such plans and subsequent performance?
- Were the police and other security services involved, and to what extent and when?
- What client monitoring of performance took place and over what period?
- Were these performance reports shared with LOCOG senior executives and the Board?
- What contractual penalties and compensation was built into the contract for under-performance and any necessary corrective action?
- If and when requests were made to change the contract, including setting a higher target for people to be recruited, what discussions took place with G4S; what were the commercial trade-offs; and how was the operational response from G4S reviewed and by whom?
- What additional costs have been incurred by LOCOG and the Government, and will these be recuperated from G4S in whole or in part?
For all the above questions, the reality is that when public service contracts go wrong, responsibility usually lies with both the client and the provider. And in such situations, there are never any winners – the reputations of both client and provider suffer. The real losers, as ever, are the public consumers who were promised, whether realistically or unrealistically, a certain level of service or safety.
If the public sector client is setting unrealistic expectations or making too little money available for a contract, sensible and ethical providers have a responsibility to say ‘no’, as they do if the deliverables are unachievable. Public sector clients also have a duty to understand what is possible and the risks associated with their tender requirements, as well as to monitor performance and hold providers to account. Ideally, they spot problems together and work together to find solutions rather than wait until it is too late. And it can be done – as has been the case with the Olympic Delivery Authority and its private sector contractors in the generally acknowledged highly successful building of the Olympic facilities.
It is too easy to find excuses for what has happened, just as it is too easy to make political capital out of what we all hope will be a most successful Olympic Games. However, it is essential that once the Olympics are over, there is a thorough enquiry which can take evidence widely – including from G4S and LOCOG staff, Government and Whitehall officials, the police, sub-contractors, recruits and applicants, other successful bidders and any external advisors used by LOCOG.
Such an enquiry will, if properly conducted, identify ways in which future major complex public procurements and contracting can be better undertaken; the realistic boundaries and limits of risks that the public sector can transfer to the private sector in areas such as security, policing and related services; and the suitability of outsourcing in these areas; and how the public purse can be protected.
In the short term, the priority that matters is rightly that of the protection of athletes and others at the Games’ venues and events.
However, the Government should announce a review to start in September and to report within a few months. For the benefit of the broader public sector and ensuring future best practice, this will be another and valuable aspect of the all-important Olympics 2012 legacy!