The Carnage Report, for those who like marketing, tech and culture covered without pity or favour

Monday, August 13, 2012

(Opinion) G4S Security: When you Can’t Catch A Break in a snooker hall

Every once in a while a company goes through a difficult period and is confronted with headline after headline detailing it weaknesses and past screw ups but G4S is a company that couldn’t buy a break in a snooker hall. However, it is more than fair to say that it has earned critical media scrutiny as reports detailed G4S lax attitude to recruitment and general incompetence before, during, and after the Olympics.

The main reason why G4S failure is big news is not because of the extent of how much G4S was unprepared for the games, but it has been a major loss for the coalition government plan to outsource parts of the public sector, especially the police. The Labour Party was quick to attack in light of G4S lack of preparation with Labour leader Ed Miliband linking the company’s failures to the coalition government plans for the public sector[1]. Miliband cited the pace of outsourcing of the police and the need “for a rethink of the role of the private sector in policing”[2].

This could prove to be an effective strategy for labour as the coalition government (the conservatives in particular) have made enemies out of the police, traditionally a natural ally of the Tories due to their tough stance on crime.

The Tories have done their best to alienate the police with a regime of spending and pay cuts to the point where Home Secretary Theresa May was subject to “heckling and jeering” when she spoke at the Police Federation Conference earlier this year[3]. Greeted with absolute silence the year before, the home secretary and her government were subject to criticism from all angles as the police federation chairman Paul McKeever revealed warning the home secretary of ‘public disorder’ and illustrated his point with images of police officers under duress during the student protests in late 2010[4].

The financial implications of G4S Olympics failure have been severe as the company ”has seen more than 400 million wiped of its market value since the debacle”[5]. Standard and poor’s has indicated that it may cut down G4S credit rating in light of the company’s major ‘underperformance’[6]. However the fiasco has not affected the ability of the company to win contracts as G4S has managed to seal a deal worth “72 million” to secure the British embassy in Kabul[7] .

While G4S may be able to secure deals abroad, it can forget any government contracts, especially roles belonging to the police as plans that were once approved by three regional police authorities that outsourced job roles to G4S are now ”under review”[8] . The main point of concern by ‘chief constables’ was that G4S was not capable of the “effective and efficient delivery of organisational support services”[9].

In sum, G4S found itself on the world stage and dropped the ball for all to see, however this will have little effect on its existing work abroad but it can forget winning any contracts from the government due to the major retreat from outsourcing by several police authorities. This could be a real fillip for the Labour Party as the conservative continue to alienate the police force, giving some room for Labour to win back law and order voters they lost in 2010.