G4S expect to receive full payment for Olympic contract

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G4S’ inability to deliver its contract to the London Organising Committee of the Olympic and Paralympic Games (LOCOG) was up for scrutiny yesterday, as the Home Affairs Committee met to establish the facts about the Olympic security debacle exactly two months after G4S’ shortcomings were brought to light.

Before the select committee grilling began, its’ chair Rt Hon Keith Vaz MP, commented that the evidence it had received up to this point clearly marked G4S’ failure with the security firm unable to give the committee a “convincing account of what went wrong”.

Paul Deighton, chief executive and Lord Coe, chair, LOCOG, gave evidence and reported that G4S had up until July 13 been paid between £89-90 million of public money. The security company’s contract had also been revised and was now worth £236 million and not the previously reported £280 million. Deighton said that the outstanding balance was up for negotiation, yet Nick Buckles, chief executive of G4S, said that it expected to be paid “in line with the contract” because “it delivered a significant portion of the contract”, and plans to take a £50 million loss because “we failed to deliver in a way we expected to”.

Buckles explained that G4S managed to recruit 16,000 people who were all rostered for shifts during the Games – however, Deighton revealed that on some days the security company failed to reach staffing targets by 35 per cent and at best four per cent. During the Paralympics, G4S did supply all the staff it said it would.

Added Deighton: “If we get a shortfall of more than 15 per cent then it creates an operational challenge – 62 per cent of venues had a worse then 15 per cent outcome therefore requiring military deployment.”

Deighton told the committee that there were some signs two weeks prior to July 11 that concerned the organising team and that G4S told them that it was a “temporary problem”. Unwittingly, Deighton continued, G4S failed to build and manage a special operations team to deliver security as good as it should have done. He described the contract as unusual in size and scope and did acknoweldge G4S for not giving up when the problems emerged.

Buckles reiterated his pledge to reimburse the police and military that stepped in at the last minute and confirmed that G4S will not be bidding for security at Rio 2016.

He said: “Communication with candidates in a complex project like this has been an issue.

“My main regret from the whole experience is staff, who do a great job day in and day out, and they were disappointed in our performance.”