Serco boss questions viability of public sector contracts in an austerity-led world – 4 ways to reduce outsourcing risk exposure
Best Practice Group, By Allan Watton
£1.3bn is quite a lot of money. Even for a FTSE 250 company, it’s a lot of money. So when Serco reported that it had to write off this sum in public sector contracts last year, the discomfort this caused was reported to be evident and far-reaching for the outsourcing firm.
In an article in The Independent, Rupert Soames, the recently appointed CEO of Serco, is reported to have said that “the Government will struggle to secure bidders for privatised outsourcing contracts” and that “there are aspects of contracts that we wouldn’t sign up to today”. With his comments, he drew an increasing focus: “There are at least eight companies that have lost tens of millions on contracts with the Government, and in the future they will all be a bit more gun-shy. Some have been put off.”
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