The inspectorate found that the prison authorities had only complied with 12 recommendations from a total of 70 put forward by Crown officials following an earlier visit in February 2017. The summary of the follow-up visit produced under chief inspector Peter Clarke highlighted “a lack of order and control on some wings”, the easy availability of narcotics, together with levels of violence “higher than at all other similar prisons”. The chief inspector concluded that “outcomes were poor in every healthy prison area”.
The involvement of HMPPS was initially meant to last for six months, but after an extension was agreed in February, it has now been decided to terminate the G4S agreement with effect from 1 July 2019. The HMP Birmingham contract was deemed “onerous” and included as a provision within the group’s full-year accounts for 2018, but the negative impact could ripple out beyond the income statement.
The group’s failure will embolden critics of the involvement of outsourcers in UK care and justice services, particularly given the fraud probes into electronic monitoring contracts previously awarded to G4S and Serco (SRP). Procurement processes have come under intensified scrutiny after the Ministry of Justice discovered that it had been overcharged by the suppliers of electronic criminal tagging services – G4S and Serco – which resulted in a repayment of £179m to the public coffers.
For shareholders in the outsourcers, the debacle at HMP Birmingham couldn’t have come at a worse time, given the political situation in the UK. At the time of writing, Theresa May, disenchanted following her attempts to strong-arm recalcitrant ministers and backbenchers to support her EU withdrawal bill, has decided to find common ground with the leader of Her Majesty’s Most Loyal Opposition or risk the matter will be put before voters at a general election.
But that may prove unavoidable anyway. There’s every chance that Jeremy Corbyn could reject the prime minster’s overtures if he believes it would further undermine her domestic political credibility. And even if agreement is reached to force through the withdrawal bill (no amended form is legally possible), it would be wholly unpalatable for many Tory backbenchers and the Democratic Unionist Party (DUP), on which the government relies for an effective majority in the Commons.
Without DUP support an election could swiftly ensue. In that event, the vote for the Conservative Party could be split in marginal constituencies if independent Eurosceptic candidates emerge. And there’s always a chance that disgruntled Tory voters could simply avoid the polls altogether, as per 1997, if they feel the party has ignored the wishes of the electorate at the 2016 EU referendum.
Either scenario could conceivably open the door for a Corbyn-led Labour Party, one ideologically opposed to the involvement of the private sector in services provided by the state. The shadow chancellor, John McDonnell, has vowed that Labour would cancel private prison contracts if it regains power in Westminster, an issue given that, in percentage terms, the UK has double the number of inmates incarcerated in privately-run jails than the US.
Of course, it doesn’t end with outsourcers and/or support services companies. Real estate developers are also in the cross-hairs, at least those Labour believes are ‘land banking’ – a practice whereby companies buy up agricultural or brownfield sites with the intention of securing residential planning approval. Once this is achieved, the land is usually worth many times the value of land without it.
Labour plans to amend the 1961 Land Compensation Act as a precursor to the creation of an 'English Sovereign Land Trust' with powers to compulsorily purchase land for housing at prices that exclude any uplift to the value brought about by prospective planning approval. Naturally, any such proposal would be vigorously opposed by developers, particularly when you consider that only 42 per cent of approved planning applications resulted in building works in 2018, according to estate agent review site GetAgent.co.uk.
