Category Archives: G4S

Cash or cashless? Vested interests strive to win the argument

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Charles Randell, chair of the government’s Payment Systems Regulator asks a pertinent question:Should access to such a basic financial service be universal, or commercially driven?”

Cashless: “Digital payments are clearly the future”: a spokeswoman for digital payment company Square

One protagonist, Helen Prowse, a spokeswoman for digital payment company Square, spoke at a debate held by Monzo, a London-based fintech startup. “Digital payments are clearly the future.” She continued: “In the UK, plastic payment cards are the most popular way to buy things. Only about 30% of transactions use paper notes and coins, The ratio is already at 15% in Sweden, which will become effectively cashless in a few years’ time”. Quartz journalist John Detrixhe appears to agree. He gives several reasons for ‘getting rid’ of cash:

  • When shops switch over to digital money, their workers are less likely to be subject to violent robbery.
  • It can also be faster and cheaper to process than notes and coins.
  • Cash helps to enable the underground economy through tax evasion as well as illicit finance.

But G4S issued a report (April ’18) showing that cash circulation has increased

G4S which transports, process, recycle, securely store and manages cash published the World Cash Report in April 2018.  It surveyed 47 countries covering 75% of the global population and over 90% of the world’s GDP. The findings show that demand for cash continues to rise globally, despite the increase in electronic payment options in recent years; cash in circulation relative to GDP has increased to 9.6% across all continents, up from 8.1% in 2011.

The report highlights the variety of payment habits in different regions. In Europe 80% of point-of-sale transactions are conducted in cash, while in North America, where card payments are most regularly used, cash use still accounts for 31%. In Asia the rise of online purchases does not mean that cash is taken out of the equation, with more than 3 out of every 4 online purchases in a number of countries paid for by cash on delivery.

Access to Cash Review: cash is “an economic necessity” for around 25 million people in Britain

Natalie Ceeney (right), a successful civil servant who is now non-executive chair of Innovate Finance, chaired the independent Access to Cash Review, funded by Link, the UK’s biggest network of cash machines. She said “The issue is that digital does not yet work for everyone.”

The review indicated that physical notes and coins are “an economic necessity” for around 25 million people in Britain, and nearly half of people surveyed said a cashless society would be problematic for them. ATMs and bank branches are under particular pressure in rural communities, where broadband and mobile service is unreliable or unavailable. Next month, the review plans to publish its recommendations on how to deal with declining cash availability.

Nicky Morgan, chair of the UK’s Treasury Committee, said recently, “Whilst cash may no longer be king, it continues to play an important role in the lives of millions. So what we’ve heard today from the PSR should set alarm bells ringing. It’s clear that the whole way that people access their cash via ATMs is starting to fail. With the way that people access their cash seemingly on the precipice of collapsing, the government can’t just bury its head in the sand. . . .”

And what will happen in a cashless society when electronic systems malfunction – as machines do – when the mobile phone cannot get a signal, when cable sheaths fail or when someone accidentally damages a phone cable?

 

 

 

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Focus on cuts – 5: the poorest targetted

A reader from Bournville draws attention to an article by Jules Birch in Inside Housing, a weekly magazine for housing professionals. He focusses on a recent TV Panorama programme about the benefit cap that now leaves thousands of people with 50p a week towards their rent.

He noticed that roughly 95% of tweets with the hashtag #benefitcap (scroll down to April 7) were hostile to the people featured in the programme rather than the policy. The majority of people commenting on Twitter were seeing the undeserving individual instead: the stroppy single mother with a mobile phone and the couple with many children. He notes that exactly the same thing happened with Benefits Street, How to Get a Council House and a Dispatches documentary on the cap last month.

Part of the problem, he believes, lay with the way Panorama framed the issue. As Joe Halewood was quick to point out, the programme and its advance publicity seemed to assume that most people capped are unemployed and on Jobseeker’s Allowance, when in fact just 13% are.

The fact that the vast majority of people capped are either unable to work or not required to work was only raised tentatively halfway through the programme. Most of those capped are lone parents with young children who are not required to look for work, or people on Employment and Support Allowance who do not qualify for an exemption but are still not fit for work.

David Pipe explained the effects in a piece following the Dispatches documentary last month. 7,500 households across 370 local authority areas have lost their housing benefit and are now receiving just 50p a week to pay their rent. The cap leaves a nominal amount for housing benefit or Universal Credit once someone’s benefits total more than £20,000 (£23,000 in London). In effect it is imposed on top of the rest of the benefits system.

The latest budget highlighted cuts for the poorest 18-21-year-olds, who will no longer be entitled to help with their rent through Universal Credit from April 1.

For many, Discretionary Housing Payments (DHPs) are the only thing keeping them in their home and the effect over time will be rising rent arrears and evictions and allocations policies that make it less likely that people on benefits will get a tenancy in the first place. So where and how can the poorest people live? Even people in caravans are being capped, and what will the knock-on costs be in terms of homelessness and the impact on the children?

Meanwhile in Broken Britain, the May government continues the policies of its predecessors and makes decisions which seriously afflict the poorest and greatly benefit the richest: the arms traders, Big Pharma, the privatised utilities, large developers, car manufacturers, private health companies and expensive, inefficient outsourcers – Serco, G4s and Capita.

 

 

 

 

Austerity 8: the prison service

Impressive new entrance (Winson Green) and corporate/political rhetoric: fearful reality

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After a series of violent incidents in recent months at HMP Lewes and HMP Bedford, four wings at HMP Birmingham in high-security Winson Green, had to be sealed after disturbances broke out. About 260 prisoners were involved.

Despite the record of G4S, which now runs five prisons in the UK, management of this prison was handed over to the private sector company in 2011. Unions opposed the deal which reduced staff numbers and pay rates.

So many public sector officers had to be drafted to ‘manage’ the Winson Green ‘dispute’ that control had to be transferred to the public sector HM Prison Service.

There have been sharp cuts to prison staff numbers as part of the 2010-15 coalition’s austerity drive even though the prison population has doubled since 1993 to more than 85,000. There are now 65 assaults behind bars every day and in the year to June, assaults on staff jumped 43% to 5,954, with 697 recorded as serious.

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Yesterday former Conservative Secretary of State for Justice Michael Gove appeared to have a change of heart. His words, reported in a recent speech, were: “I am convinced that we cannot provide the effective level of rehabilitation we need for offenders without either increasing expenditure significantly or reducing prisoner numbers overall, because overcrowded prisons are more likely to be academies of crime, brutalisers of the innocent and incubators of addiction rather than engines of self-improvement.”

 

 

 

A reader-recommended video: “Who’s spending Britain’s billions?

 

tighten-belt-cropAs the International Tax Review confirms rumours of plans to cut Britain’s corporation tax rate (‘a race to the bottom’), Jacques Peretti opened this video by reminding us that for some years the 99% have been required to tighten their belts.

In this film he focussed on what is happening behind closed doors in Britain; he found that local councils across the UK are signing contracts with management consultancy firms who can take a percentage of any savings they find. Luminaries such as McKinsey, Serco, G4S and Capita were named.

There are 36 articles with Capita in the title on our database and many more references in other texts.

The earliest: from 1999 there had been serious computer failures in public sector in programmes designed by several providers, including Capita. In 2004, schools were forced to close because of delays to a database to vet teachers, run by Capita. In 2005, Capita’s software was said to be responsible for the failure of a government scheme for allocating school places. In 2006: Computer Business Review reported that Capita’s chairman had resigned after the discovery of secret loans to the Labour Party from whom the company had received a number of very lucrative contracts.

The latest: in August this year a Solihull reader alerted us to a Pulse magazine report on serious shortfalls in Capita’s primary care support services. Medical practices are facing delays as patient records and supplies are missing and payments made late. Alex Matthews-King, who wrote the article, reported on the situation, using data published in April 2016 – two years after the private company Capita won the £330m contract to provide primary care support services, with a budget cut of 40%. A search will find many analyses of Capita’s performance for local authorities,  Birmingham in particular.

Taking self-regulation to a new low

Last year the outspoken Audit Commission – the ‘watchdog’ scrutinising council spending was disbanded. David Cameron said that a critical mass of citizen watchdogs would become a new force for accountability. He hoped a ‘whole army of effective armchair auditors looking over the books’ would act as a check on ‘waste’, but this army has not appeared, as the BBC pointed out.

Commercial confidentiality hides information about the use of taxpayers’ money

99-3Peretti reveals that hundreds of the millions of taxpayers’ pounds spent on these contracts are covered by confidential deals and very little detail is known about them. Many readers will not be surprised to hear allegations about consultants who – the blurb says – ’leech off local councils and bleed them dry’. For years they have watched the outsourcing of public services which don’t produce the promised savings and heard councillors justifying the use of these expensive and sometimes inefficient assistants.

Peretti’s final question? Does the public deserve to know how those charged with managing Britain’s billions are spending them?

 

 

 

In Cloud Cuckoo Land, save money by recruiting an outsourcer

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Capita, the FTSE 100 outsourcer, which manages the congestion charge for Transport for London and administers military bases across the UK for the Ministry of Defence, has just been awarded a £1bn NHS contract. Other reported triumphs:

  • A contract helping new doctor-led clinical commissioning groups to buy billions of pounds of services for hospitals and GPs.
  • An £80m, 10-year contract providing IT, finance and estate management services to the Central London Community Healthcare NHS Trust, which employs 3,000 staff providing services in west London.

The NHS seeks to use the private sector in its pursuit of savings – really?

The FT’s Gill Plimmer and Sarah Neville, who report that Capita has largely avoided the scandals that have tarnished rival outsourcing groups G4S and Serco, are directed to the work of Professor David Bailey on the company’s record, ‘assisting’ in the local government of Birmingham. One of many analyses is his Service Birmingham’s £63,000-a-day Dividend Bombshell. For others, search on David Bailey, Capita.

Despite its recent London and Liverpool setbacks . . . another reward for failure?

The seven-to-10 year contract will see Capita provide GPs, opticians, pharmacists and dentists with a range of back office services, including payments administration and the management of clinical records.

Five Liverpool NHS Trusts withdrew from a contract with Capita because of concerns about the quality of the service provided. In September 2014, a few months later, West London Mental Health NHS Trust cancelled their contract after the company proved “unable to meet acceptable ‘time to hire’ targets”, particularly for nurses. At the same time Alder Hey Children’s NHS Foundation Trust and Liverpool Heart and Chest Hospital NHS Foundation Trust terminated their contracts. And in November Mersey Care Trust revealed that “information governance issues” had been uncovered when the services were taken back in house.

A change of tune

After their recent lobbying – see Health corporates rampant – private sector providers are now said to be ‘quietly confident’ that more opportunities will emerge. They believe that many healthcare trusts, faced with a £30bn shortfall in the NHS budget over the next seven years, will have little option than to work with the private sector, which pledges to invest in technology, improve staff productivity and use economies of scale to deliver services at lower costs.

And caring health professionals say?

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Dr Clive Peedell, a cancer specialist who is co-leader of the National Health Action Party, established before the general election in May with a full manifesto commitment to improving the nation’s public health care, said:

“This is exactly what we predicted would happen. The ludicrous NHS structure created by this government has meant a whole new layer of administration is needed to support it, increasing costs and diverting money away from patient care. Now a giant outsourcing company is cashing in on providing a service the NHS should not even need, that has been cultivated by this government.”

Austerity 4: cuts persist as the state offers even richer pickings for corporations

 Recently Lesley Docksey sent this heartfelt reflection:

“The trouble is we know the problem, and it’s all very well George and Seamas saying we have to ban this, get rid of that and set up something else.

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“But how do we actually do it, how do we the people force a break between the corporate power and politicians?”

Despite the poor record of service by the private sector in prisons, transport, energy and water, British schools and hospitals are loudly threatened with takeover, a slavish imitation of our special friend’s policies for schools and hospitals.

Cameron's real change

Anne sent this link to an article by Jon Stone about the fire hazard and other structural failings of Cumberland Infirmary in Carlisle, first opened in 2000 under the “private finance initiative”, under which the NHS pays a private company rent-like payments to make use of facilities. The UK now owes more than £222bn to banks and corporations for these Private Finance Initiatives, conceived by Conservatives in the 1990s and ‘embraced’ by New Labour.

Will this hospital be handed over to ‘the state’? In other words, farmed out to Capita, G4S or Serco?

atos costs

In the FT, Gill Plimmer reported that the Official Journal of the European Union database, which records every public sector contract worth more than £115m, reveals that £20bn worth of government contracts is now handed to the private sector. About half of council waste management services and 23% of human resources, IT and payroll functions are now privatised. Tens of thousands of health, defence, security and IT workers have transferred to corporate employers such as Babcock, G4S, Serco, Capia, Mitie and Carillion. This continues, even though the reputation of the private sector in delivering public services has been repeatedly damaged – examples include the high profile failure of G4S during the Olympics and the legal action facing Virgin Care over its running of NHS and social care services in Devon. Monbiot’s devastating, fully referenced account of such failures may be read here and others have been written by Gill Plimmer in the Financial Times.

‘Mayoral hokum’

joe anderson liverpool mayorAs all these services are transferred via the state into corporate care, the cities themselves are being coerced to follow the mayoral route – which, as Steve Beauchampé notes in the Birmingham Press -was soundly rejected by voters in Birmingham, Coventry and seven other cities.

Did Liverpool – which held no referendum – make the right choice?

Chancellor Osborne is insisting that powers must be devolved through the office of a regional mayor – so much easier to induce or threaten than a whole council – a puppet?

As economic geographer, Professor Michael Chisholm summarised the position more politely, “One could cynically say that the proposal for elected mayors is yet another structural diversion while the steady centralisation of power continues”.

Beauchampé proposes consigning this ‘mayoral hokum’ to its rightful place in the dustbin of history, rejecting the notion that in a democracy just one person can understand, represent and address people’s priorities, needs and hopes, creating and implementing a vision for our fast changing region and its youthful population. He sets out a ‘radical’ – because truly democratic – alternative as a draft proposal.

But, as Lesley asks, “how do we the people force the break between the corporate power and politicians?”

Proportional representation could be the first step.

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