Defence Secretary Says G4S Failure Shows Limits Of Private Sector

The military being called in to save Olympic security following the failure of G4S to provide what was contracted, has made defence secretary Philip Hammond rethink his views on the private sector.

Almost 5,000 troops had to drafted in to make up the shortfall left when private security company G4S failed to meet the requirements of its £284m contract.

In an interview with the Independent, Mr Hammond said the “military rescue” had been “quite informative”.

"I came into the MoD with a prejudice that we have to look at the way the private sector does things to know how we should do things in government. But the story of G4S and the military rescue is quite informative."

"The G4S model says here is a cost envelope within which I have to deliver an outcome and therefore I have to do it incredibly leanly.

"So G4S were literally hiring people and expecting to deploy them three days later, into a live situation; trying to build up a management structure overnight, at the beginning of the operation.

"A very lean structure, with lots of dependence on self-motivation by the people in the workforce; scheduling their own shifts, for example, by accessing an internet site.

"The military comes at it from the exact opposite extreme. What's the job that needs to be done? OK, we'll do it. Whatever it takes we'll pour in massive over-resourcing, massively heavy structures of management."

Adding: "What the military primarily deliver is contingent capability and I haven't been able to think of a single large-scale example where a private organisation delivers a contingent capability.

"You pay for it, year in, year out, but you probably never use it for what it's designed for."

(H)