Home Affairs Committee blasts G4S for Olympic fiasco

The Home Affairs Committee, the group of MPs investigating G4S's failure to fulfil all of its Olympic Games contractual requirements, has called on the security firm to waive its fee.

The Home Affairs Committee, the group of MPs investigating G4S's failure to fulfil all of its Olympic Games contractual requirements, has called on the security firm to waive its fee.

"G4S should waive its £57m management fee and also compensate its staff and prospective staff who it treated in a cavalier fashion," the damning report says.

Subscribe to MoneyWeek

Become a smarter, better informed investor with MoneyWeek.

G4S released a penitent statement following the publication of the report and said its own investigation into "what went wrong with the execution of the contract and specifically why the contract execution issues were not identified on a more timely basis" is close to completion.

G4S has already revealed that it expects to swallow a £50m-or-so loss on the contract. This figure includes an estimate for the additional costs incurred for the deployment of the increased military and police and penalties and liabilities due under the terms of the contract. It has also made clear, perhaps with half an eye on the fact that it will be bidding for lots more government contracts in the future, that the British taxpayer will not bear any additional costs.

Advertisement - Article continues below

The group did quibble with the notion that the £57m "management fee" cited by the Home Affairs Committee (HAC) is a profit. "It relates substantially to real costs which have been incurred such as wages, property and IT expenditure," the group explained, adding that the final financial settlement is currently under discussion with LOCOG, the body which organised the London Olympic Games.




Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020
Share tips

Class acts going cheap: buy into Europe’s best bargains

Value investing appears to be making a comeback, while shares on this side of the Atlantic are more appealing on metrics such as price/earnings ratios…
16 Jan 2020

Most Popular


Three things matter for the UK housing market now – and “location” isn’t one of them

The UK housing market is frozen. And when it does eventually thaw out, the traditional factors that drive prices will no longer apply. The day of reck…
1 Apr 2020

What does the coronavirus crisis mean for UK house prices?

With the whole country in lockdown, the UK property market is closed for business. John Stepek looks at what that means for UK house prices, housebuil…
27 Mar 2020
Small business

Furlough: what does it mean and how does it affect me?

Many companies have “furloughed” employees after they have shut down because of the coronavirus. But what does furlough mean and how does the scheme w…
30 Mar 2020

Buy stocks for the long term, but buy very carefully

After the wild ride of the last couple of weeks, equities are no longer expensive. But if you do decide to buy, be very, very careful indeed, says Mer…
30 Mar 2020