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G4S Olympic contract review prompts two resignations G4S Olympic contract review prompts two resignations
(about 3 hours later)
Two G4S directors have resigned after the company announced the findings of a review into its Olympic Games contract.Two G4S directors have resigned after the company announced the findings of a review into its Olympic Games contract.
The two are David Taylor-Smith, chief operating officer, and Ian Horseman Sewell, a managing director.The two are David Taylor-Smith, chief operating officer, and Ian Horseman Sewell, a managing director.
Chief executive Nick Buckles, the public face of the company, however, has kept his job.Chief executive Nick Buckles, the public face of the company, however, has kept his job.
The company was paid a £57m fee to supply Olympics security staff, but had to rely on the army for back-up after failing to fill the posts.The company was paid a £57m fee to supply Olympics security staff, but had to rely on the army for back-up after failing to fill the posts.
Mr Buckles has admitted the botched contract was "a humiliating shambles". MPs on the Home Affairs Select Committee last week called for the company to hand back the fee.
href="http://www.investegate.co.uk/Article.aspx?id=20120928071045H4451" >A statement from the company said the review, by the consultants PricewaterhouseCoopers, did not hold him personally to blame for what went wrong and said it was in the best interests of the company and its stakeholders that he should remain in charge. Committee chairman Keith Vaz welcomed the resignations, saying that they showed that "G4S at the highest levels have taken the report of the committee [and] the concern of the public very seriously indeed".
But he pointed out that it had not carried out the committee's other recommendations.
The issue of the management fee remained unresolved, he said, and the company had not compensated prospective employees who were waiting to start work with G4S for months, and may have lost other work as a result.
"Just this morning, I have been emailed by employees of G4S who have not been paid for work they have done at the Olympic and the Paralympic Games," Mr Vaz told BBC News.
Boss' role
Chief executive Mr Buckles has previously admitted the botched contract was "a humiliating shambles".
A statement from the company said the review, by the consultants PricewaterhouseCoopers, did not hold Mr Buckles personally to blame for what went wrong and said it was in the best interests of the company and its stakeholders that he should remain in charge.
"Whilst the [chief executive] has ultimate responsibility for the company's performance, the review did not identify significant shortcomings in his performance or serious failings attributable to him in connection with the Olympic contract.""Whilst the [chief executive] has ultimate responsibility for the company's performance, the review did not identify significant shortcomings in his performance or serious failings attributable to him in connection with the Olympic contract."
MPs last week called for the company to hand back the fee.
G4S has said it lost £50m on the £235m contract to supply 10,400 staff, almost half of whom were not able to take up their posts, leaving the armed forces to fill almost 5,000 of these.G4S has said it lost £50m on the £235m contract to supply 10,400 staff, almost half of whom were not able to take up their posts, leaving the armed forces to fill almost 5,000 of these.
The report said the Olympic contract was unique, but the company was capable of fulfilling it.The report said the Olympic contract was unique, but the company was capable of fulfilling it.
But pointing to the scale and complexity of the contract, it said management frameworks and practices were ineffective to address this and therefore "the issue was in its delivery".But pointing to the scale and complexity of the contract, it said management frameworks and practices were ineffective to address this and therefore "the issue was in its delivery".
G4S is making a number of changes to how it will deal with future substantial contracts.G4S is making a number of changes to how it will deal with future substantial contracts.
It says it will appoint a chief operating officer to work closely with Mr Buckles on areas including customer service and project delivery.It says it will appoint a chief operating officer to work closely with Mr Buckles on areas including customer service and project delivery.
It has also promised to examine new contracts more thoroughly and will ensure that the board of directors oversee contracts where annual income is above £50m.It has also promised to examine new contracts more thoroughly and will ensure that the board of directors oversee contracts where annual income is above £50m.