Probation ‘mess’ casts shadow over government outsourcing
Bailouts of £500m to private sector, with some offenders only monitored electronically
“It was a big bang that completely reorganised the world, and if it didn’t work there was no easy route back,” said Mr Le Vay. Before Mr Grayling’s reforms, public-sector trusts supervised around 200,000 ex-offenders each year. But Mr Grayling broke up the system, giving eight private firms, including Sodexo, MTCnovo, and Ingeus, £3.7bn worth of contracts to run 21 “community rehabilitation companies” providing supervision and support to “low-to-medium-risk” offenders.
- £3.7bn privatisation of probation services seen as ‘mess’ and ‘disaster’
- Private providers complained contracts were lossmaking and ‘unsustainable’
- Questions remain about government plans for new private-sector contracts
James Alderson joined the National Probation Service a decade ago to help offenders stay out of prison. But when a large part of the service was privatised in 2015, he found that staff cutbacks and piles of paperwork meant he had less contact with the people he wanted to help.
Privatisation was meant to bring innovation and cost discipline to the service, and cut stubbornly high re-offending rates in England and Wales — where more than half of people with previous convictions go on to commit another crime within a year of being released. But Mr Alderson, whose name has been changed, said “the entire process has been a disaster”. MPs on the Commons justice select committee have reached a similar conclusion, saying in June that privatisation had been a “mess”, with private companies making “little difference” to offenders’ future prospects.
Last month, justice secretary David Gauke agreed to end the private sector contracts in 2020, two years earlier than originally planned. The government has not disclosed the cost of the experiment, but the Ministry of Justice has been forced to agree bailouts totalling at least £500m to the private sector. The fallout has revived questions about private-sector involvement in delivering key government services, especially after the government contractor Carillion collapsed earlier this year.
“It’s another example of the doctrinaire assumption by politicians that the private sector will always deliver better results,” said Julian Le Vay, a former finance director of HM Prison Service. “Probation wasn’t broken,” he said. “There was room for improvement but we could just have had a more efficient public-sector organisation, without affecting the quality of service.”
‘It was a big bang’
The grounds for privatisation were laid in the 2007 Offender Management Act, which was brought in by a Labour government. But it was Conservative Chris Grayling who, as justice secretary, launched the “rehabilitation revolution” in 2014. He cancelled his predecessor Ken Clarke’s pilot programmes for privatisation, pushing through a more ambitious set of reforms in just over a year.
“It was a big bang that completely reorganised the world, and if it didn’t work there was no easy route back,” said Mr Le Vay. Before Mr Grayling’s reforms, public-sector trusts supervised around 200,000 ex-offenders each year. But Mr Grayling broke up the system, giving eight private firms, including Sodexo, MTCnovo, and Ingeus, £3.7bn worth of contracts to run 21 “community rehabilitation companies” providing supervision and support to “low-to-medium-risk” offenders.
The community rehabilitation companies were also given the job of working with 45,000 prisoners who had been in jail for less than 12 months, who had previously received no support after release but had a high reoffending rate, with nearly two-thirds committing another crime within a year. Cases involving “high-risk” offenders remained within the National Probation Service, which is now part of the civil service.
Lossmaking contracts were ‘unsustainable’
But after the overhaul, private-sector companies were not getting the level of referrals expected, in part because of errors in Ministry of Justice forecasting. The MoJ had projected that private sector providers would handle 70 per cent of the cases. But in reality, the private providers only handled about 40 per cent of cases. The courts who assigned probation cases had little faith in the private providers, none of whom had any previous experience in the field.
It also proved difficult to classify ex-offenders, because a change in circumstances, such as eviction, an alcohol problem or family conflict, could easily change their risk category from “low” to “high”. Probation staff were also divided arbitrarily between the public and private providers, even though in some cases they continued to share offices.
By 2016, the private providers were complaining that the contracts were lossmaking and “unsustainable”. As a result, they axed jobs and closed offices, making it more difficult for offenders to attend appointments. Some contractors, such as Sodexo, monitored offenders using unmanned electronic kiosks. Two out of five offenders monitored by the private providers are now supervised by telephone, with calls every six weeks, rather than in person, according to the chief inspector of probation.
‘Now we are an embarrassment’
The government is now consulting for a new round of contracts, with different financial terms and minimum requirements for the number of face-to-face meetings held with ex-offenders among other changes. The new contracts would also align the community rehabilitation companies with the National Probation Service’s regional operations. MTCnovo has said it is committed to the service and would bid for future contracts.
But few believe that privatisation of the probation system can work, even with the changes. The Welsh government has already decided to use devolved regional powers to take its own probation service back in-house, giving control to the National Probation Service.
But few believe that privatisation of the probation system can work, even with the changes. The Welsh government has already decided to use devolved regional powers to take its own probation service back in-house, giving control to the National Probation Service.
Robert Neill, the Conservative MP who chairs the Commons justice select committee, has questioned whether a privatised system “will ever deliver the kind of probation service we need”. Mr Alderson said: “Other criminal justice systems used to look at us as a model for offender intervention,” he says. “Now we are an embarrassment.”
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I notice the article generated a couple of responses on Facebook:-
The FT is still a relatively influential newspaper despite its comparatively small circulation. It has an excellent international reputation for well sourced and evidenced financial journalism that is mainly aimed at looking after business interests rather than having an overtly political axe to grind. Those with power money and influence read it and form their opinions as a result. In other words those who can make a difference read it, including overseas investors in the so called UK 'justice market', and will undoubtedly now be more cautious particularly if they do some research and find a number of articles across the media warning of a mess. This article takes up the best part of page 3 along with a smaller article regarding Grayling failing to take advice regarding Heathrow. The final three paragraphs are particularly telling 'But few believe that privatisation of the probation system can work, even with the changes'.
The Welsh government has already decided to use devolved regional powers to take its own probation service back in-house, giving control to the National Probation Service. Robert Neill, the Conservative MP who chairs the Commons justice select committee, has questioned whether a privatised system “will ever deliver the kind of probation service we need”.' I detect a groundswell of opinion that runs counter to the MoJs proposals that are clearly not brave enough given the scale of the problems faced. Yes to end of CRC contracts. Yes to reunification of core probation services. Yes to both English and Welsh probation services returning to public ownership.
******
Hats off Mr Alderson, whoever you are. I have a feeling that there is all to play for now, and the biggest hurdle and risk in the path of serious positive progress is the devastating effect of TR on probation people. There used to be a fashion in management theory for drawing analogies between organisations and individual psychology/pathology. Any psychology/psychiatry/etc practitioner would have a their hands full with Probation as a client. If you were to diagnose Probation as a group collective, what would it be? PTSD? Stockholm Syndrome?
--oo00oo--
I notice the article generated a couple of responses on Facebook:-
The FT is still a relatively influential newspaper despite its comparatively small circulation. It has an excellent international reputation for well sourced and evidenced financial journalism that is mainly aimed at looking after business interests rather than having an overtly political axe to grind. Those with power money and influence read it and form their opinions as a result. In other words those who can make a difference read it, including overseas investors in the so called UK 'justice market', and will undoubtedly now be more cautious particularly if they do some research and find a number of articles across the media warning of a mess. This article takes up the best part of page 3 along with a smaller article regarding Grayling failing to take advice regarding Heathrow. The final three paragraphs are particularly telling 'But few believe that privatisation of the probation system can work, even with the changes'.
The Welsh government has already decided to use devolved regional powers to take its own probation service back in-house, giving control to the National Probation Service. Robert Neill, the Conservative MP who chairs the Commons justice select committee, has questioned whether a privatised system “will ever deliver the kind of probation service we need”.' I detect a groundswell of opinion that runs counter to the MoJs proposals that are clearly not brave enough given the scale of the problems faced. Yes to end of CRC contracts. Yes to reunification of core probation services. Yes to both English and Welsh probation services returning to public ownership.
******
Hats off Mr Alderson, whoever you are. I have a feeling that there is all to play for now, and the biggest hurdle and risk in the path of serious positive progress is the devastating effect of TR on probation people. There used to be a fashion in management theory for drawing analogies between organisations and individual psychology/pathology. Any psychology/psychiatry/etc practitioner would have a their hands full with Probation as a client. If you were to diagnose Probation as a group collective, what would it be? PTSD? Stockholm Syndrome?
"By 2016, the private providers were complaining that the contracts were lossmaking and “unsustainable”. As a result, they axed jobs and closed offices"
ReplyDeleteNo sympathy for private providers. They had contract teams preparing bids. They boasted about their skills & experience of delivering outsourcing services. They were seduced by the prospect of "easy money". Greed & hubris got the better of them.
And they certainly didn't wait until 2016 to axe jobs, close offices & cash in the assets they acquired for £1 per CRC.
Nevertheless, Hats off to Mr Alderson.
The FT are also today reporting on the sorry state of Interserve.
DeletePaywall.
Yes they did privateers walked in like cowboys hootin tootin rootin and shootin like they owned the joint. Saking staff and spend spend spend on their new cars and personal profits. Now the gloss is gone the spending over the rush to waste public monies in the short terms than understand the contracts ewre set over the longer terms they completely failed. Failed the government failed them selves failed the workers and failed society. Best news of all they did not just lose the 2 years left on contract the best news is they lost the option on the additional years and that means we are free of their kind under the terms they could never deliover . It will not be any different in the daft and ridiculous TR2 instead predicted here TR2 will be just as bad as they cannot deliver face to face services on a budget because they will never cope with individualised tailored services for client based need.
DeleteIt's outsourcing and the continuing awards of failing contracts of public services that's the real embarrassment.
ReplyDeleteI can't help but smile a little though when I read today that the outsourced cleaners at the MoJ have gone on strike.
https://www.theguardian.com/commentisfree/2018/aug/07/striking-ministry-of-justice-cleaners-migrant-workers-london-living-wage
'Getafix
https://www.independent.co.uk/news/business/news/government-face-iwgb-union-landmark-court-case-outsourced-workers-rights-a8480461.html
DeleteFT Today re Interserve.
ReplyDeleteOne - three hours ago: -
"fastFT Interserve PLC
Outsourcer Interserve suffers tough start to year
Camilla Hodgson 3 hours ago
Print this page
UK government contractor Interserve suffered a plunge in profits in the first half of this year but said its restructuring was on track, months after it agreed a survival deal with creditors. Shares fell 10 per cent in early trade on Tuesday.
The outsourcer, which provides support services in areas including probation and healthcare, reported a loss before tax of £6m, compared to a £24.9m profit in the same period last year, while headline profit before tax — adjusted to include the impact of the group’s exit from several of its smaller businesses — dived 81 per cent to £9m. Revenue also fell 10 per cent to £1.5bn.
Nevertheless, Interserve said it had made a “significant” improvement compared to the particularly poor performance seen in the second half of 2017, and said its restructuring and cost-cutting programme to save £15m in 2018 was on track.
“The first half of 2018 was an important period for Interserve as the new management team took actions to bring stability to the business and agree the direction of the Group’s future strategy. The ‘Fit for Growth’ initiatives we are implementing are delivering material cost savings and will result in a simpler, more focused and more effective Interserve,” said chief executive Debbie White.
She said the group had a “significant amount of work to do,” but said multimillion pound contract wins in the period — including with the Ministry of Justice, Foreign and Commonwealth Office and King George Hospital — demonstrated “momentum in the business,” and that overall trading was in line with expectations.
Interserve is one of a number of government outsourcers to have come under scrutiny in the wake of the collapse of former rival Carillion in January. Later that same month, the Cabinet Office set up a team to monitor Interserve, and on Tuesday Interserve said it was “working closely” with the team “in evolving the way the sector engages with the UK government.” Since then, shares in Interserve have hovered around lows not seen since the 1980s.
In the opening six months of this year, Interserve exited its property development business and continued winding down its Energy from Waste business, which it said would allow it to focus better on its “core activities” in support services. However, the group’s announcements to the market, between July 2016 and February 2017, that it was planning to stop building plants that generate energy from waste is currently being investigated by the Financial Conduct Authority.
Meanwhile, Interserve’s construction business in the UK made a return to operating profit as it “continued to strengthen our pricing and bidding controls,” but its equipment services saw lower revenue and profit, largely as a result of the trade blockade in Qatar and fewer infrastructure projects in the UK.
In July, the UK government announced plans to scrap private companies’ contracts to run probation services after admitting reforms had gone badly wrong. Companies including Interserve will have their contracts terminated two years early, in 2020.
“Current year performance and our view on the likely conclusion of the final contract renegotiation mean that we have increased the size of the forward loss provision for this contract,” said Interserve in relation to the planned contract wind up.
Copyright The Financial Times Limited 2018. All rights reserved."
https://www.ft.com/content/9ed51c3e-9a07-11e8-9702-5946bae86e6d
FT Today re Interserve.
DeleteTwo - two hours ago: -
"fastFT Interserve PLC
Interserve shares volatile after outsourcer swings to loss
Shares fell as much as 12% in early London trade before recovering
Camilla Hodgson 2 hours ago
Print this page
Shares in troubled government outsourcer Interserve dropped more than 10 per cent in early trade on Tuesday, before making a sharp recovery, after the group swung to a loss in the first half of the year.
Shares in Interserve fell as much as 12 per cent in early trade in London after the group reported a £6m loss for the six months to June 30 and a 10 per cent fall in revenue. After the initial drop, the share decline eased to only 1.5 per cent.
The news comes soon after the group, which provides support services in areas including probation and healthcare, secured a rescue deal from creditors and in the wake of probes from both the UK Cabinet Office and the Financial Conduct Authority.
It also follows an announcement in July that the UK government plans to wind up contracts with private companies, including Interserve, for probation services several years early.
In October, Interserve warned that it expected operating profit for the second half of 2017 to be “approximately half the level” of that reported in H2 in 2016, and subsequently reported a loss for the full year. Shares plunged on the news, and have since traded at lows not seen since the 1980s.
Copyright The Financial Times Limited 2018. All rights reserved."
https://www.ft.com/content/e9c960f6-9a11-11e8-9702-5946bae86e6d
Seen on Twitter from Mike Rolfe (remember him) - with a link to Facebook: -
ReplyDelete"Michael Rolfe
7 hrs ·
So HMPPS are recruiting a TUPE manger...someone with knowledge of TUPE legislation and experience of large scale transfers is required!
For anyone unaware TUPE from .gov website;
“When a business changes owner, its employees may be protected under the Transfer of Undertakings (Protection of Employment) regulations (TUPE).”
I wonder what possible work HMPPS may have lined up for this new role??"
https://www.facebook.com/michael.rolfe.9210/posts/10156706504813573
is this to help TUPE CRC staff into new contracts?
DeleteOne would hope its to help TUPE CRC staff in Wales into the NPS/HMPPS or whatever the fuck it is now. But I suspect not. London takes no incoming calls, and Wales is going its own heroic way. I wait with no particular hope to see any attention paid in this blog, Napo, the press, anyone frankly not in Wales, to notice that the template for the salvage of at least a bit of the TR wreckage, is present, and to invest in it
DeleteHelp them is pushing it a bit , under TR terms and conditiions , and I am thinking pensions , transferred to the new company , if its TUPE then the company - the CRC ceases and staff are transferred to a new employer , new terms and 'equivalent' pensions ???. Maybe this is how the new owners (old owners new company name) hope to find a bit of margin to make this profitable.
ReplyDeleteWould HMPPS like to reassure people ?
Justice Sec continues to hold Golden Share in all 21 CRCs, so Gauke has to approve everything. Interesting that TUPE is now being considered when a simple transfer of ownership of the newly formed companies was Grayling's preferred means of fucking us in the ass. Perhaps Napo are up to speed? Or maybe a few laps behind, as ever.
ReplyDeleteMaybe the job is related to prison staff or other groups employed by MOJ - I cannot tell from Mike Rolfe's Facebook post.
DeleteThis from Mike Rolfe on Facebook:-
DeleteIt could be as simple as someone to oversee the recent early termination of the probation CRC contracts and moving staff over to the new providers, however it’s worrying that they are recruiting someone full time into such a role with all the noises being made about privatisation coming back to the fore.
The Tories maybe smelling a sense of defeat for the next election whenever that maybe...they started privatising large chunks of Probation in the run up to the 2015 general election in the fear that they might lose...for those in power that seek to gain from their position what better way than to continue personally benefitting from privatisation even if you are not in Government.
Setting contracts for private sector to run public sector work that will see you past any other Governments period of power/office is a fool proof mechanism to personal wealth if you have a personal interest as ending any contracts early are almost as expensive as ‘sweating them out’ to the end of the contract period.
I have no issues with anyone working in the private sector and I do not think individuals are any different or of lower calibre for working in the private sector, for me however the private sector profiteering from incarceration is abhorrent.
The short sightedness of privatisation on public services...the simple maths always mean that someone is losing out in order to make someone who is already wealthy even more wealthy either through profit or shareholders dividends. This for me is where the general public need to be more aware of what privatisation on public services will create because hand in hand with making the wealthy more rich is the fact that the priority no longer becomes public duty but turns into individual greed and that in no way can ever be used or manipulated to rehabilitate and better our society!
A response:-
Colleagues in CRCs are currently not employed by the CRC owners they’re employed by the CRC we weren’t TUPEd . Very concerned if the plan is for new providers to be employers.