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Public Sector Outsourcing: Learning Lessons from Carillion and Interserve

Jenny Draper points to the importance of evaluation criteria for contracting out: “Evaluation criteria on how the government awards such contracts in such vital areas to suppliers known to have associated risk needs to be challenged. There are so many other outsourcing organisations which make up a huge part of our social, healthcare, local authority network, perhaps more services outsourced than in-sourced in certain areas; the authorities who make these decisions need an urgent review of their award criteria on future contracts or face yet more wrath from the ever more vocal taxpayer.”

Source: Spend Matters

An in-depth look at outsourcing giant Carillion one year after its collapse

The Telegraph’s Jack Torrance has taken an in-depth look at outsourcing giant Carillion one year after its collapse. “The sorry episode has dominated the business and political agenda for the past year. As Carillion’s surviving rivals and suppliers continue to battle against tough conditions and the Insolvency Service readies its own report into what went wrong, it will remain a lasting influence for some time to come.” The UK public services union Unite has published an in-depth report on the Carillion collapse “Carillion’s approach to bidding for these contracts underlines the inherent problem with successive government’s mania for outsourcing. The company which provides the lowest bid is awarded the contract, creating a race to the bottom where all the quality is cut from a contract with the wages of staff and their conditions being seen as a prime area to chop. In many cases the low bid is a deliberate gamble as the company hopes to make healthy profits from additional services required by the client outside of the contract.”

Source: The Telegraph

Trade unions in Britain are reporting a “staggering” increase in outsourcing

Despite the bitter experience of the Carillion collapse, trade unions in Britain are reporting a “staggering” increase in outsourcing. “The lifetime value of outsourcing contracts awarded in 2017-18 ‘rocketed’ by 53% from £62bn to £95bn in the past year, according to the GMB union, which pointed to nearly £2bn in contracts awarded to Capita and Interserve despite both issuing profit warnings. The GMB said this showed a government ‘hell-bent’ on privatisation, despite the warning signs given by the collapse of Carillion, which managed public sector contracts to provide services such as prison maintenance and school dinners.”

Source: the Guardian

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Ending Bandit Capitalism: Learning the lessons following Carillion’s collapse

The UK public services union Unite has published an in-depth report on the collapse of the government outsourcing company Carillion. “Carillion’s approach to bidding for these contracts underlines the inherent problem with successive government’s mania for outsourcing. The company which provides the lowest bid is awarded the contract, creating a race to the bottom where all the quality is cut from a contract with the wages of staff and their conditions being seen as a prime area to chop. In many cases the low bid is a deliberate gamble as the company hopes to make healthy profits from additional services required by the client outside of the contract.”