UK government urged to justify £108m contact-tracing deal with Serco

The government has been urged to demonstrate there was no favouritism at play in awarding Serco a contact-tracing contract worth £108m, as a leaked memo revealed the outsourcing firm was enlisted to help with the Covid-19 response as early as January.

Serco is facing growing calls to be axed from any future involvement in contact-tracing services amid concerns over the performance of private firms contracted to trace people who have mixed with infected individuals.

An email leaked to Justin Madders, the shadow health minister, showed the company was approached by Public Health England in January over preparations to tackle the pandemic, prompting questions over whether it was “cherry picked” by the government and given the inside track.

The £108m contract was directly awarded to Serco by the Crown Commercial Service on behalf of the Department of Health and Social Care (DoHSC) in May. It was not put out to open tender but selected via an existing framework of suppliers.

It comes after the government announced on Monday that NHS test and trace was cutting 6,000 contact-tracer jobs and allocating roles to regional teams to work with councils, after criticism that the centrally run system was failing to tackle local outbreaks.

Along with outsourcing firm Sitel, Serco has been contracted by the government to oversee “non-complex” contact-tracing cases in England, where call centre workers contact individuals who have spent time with an infected person. The firm has been forced to defend its performance, however, after figures showed just over half of people from the same household as an infected person were being contacted. Concerns have been raised by contact tracers that they have made just a handful of calls and feel untrained.

With Serco’s £108m three-month contract up for renewal on 23 August, the shadow health secretary, Jonathan Ashworth, and the shadow Cabinet Office minister, Rachel Reeves, jointly wrote this week to the health secretary, Matt Hancock, urging him not to hand Serco any more money to run contact tracing. They are calling on the government not to extend the contract, which could be worth up to £410m.

On Tuesday Madders released an email that he said was sent to Serco contact tracers in early June on behalf of the firm’s customer services director, Garry Robinson, which suggested the company had been contacted by health officials in January asking for help.

In the email, Robinson conceded it had been a slow start but stated there would be a “steady increase in the workload” in the coming weeks. In a section titled “journey so far”, he detailed the company’s early involvement in the pandemic response, writing: “I received a call from Public Health England officials on 22 January, explaining there was a virus in China, which was causing them concern, and they asked if I could stand up a small team in case they required urgent support. Since then, I have been responsible for a number of support lines across various government departments offering support to citizens of the UK concerned about their health, the financial impact CV-19 has had on them, their children’s education and the impact on their companies.”

Madders told the Guardian: “That email went out to contact tracers in early June and suggests Serco was cherry picked very early on by the government to get involved in the pandemic response. It looks like they’ve had the inside track from the start. It begs the question, why was Serco asked as early as January to get involved in the government’s response to the pandemic?

“It’s clear that adequate procurement processes were not followed when Serco was later awarded a £108m government contract to oversee contact tracing. Like with some PPE contracts, this seems to be creating a bit of stench. It’s up to the government to demonstrate there was no favouritism at play here.”

Cat Hobbs, director of We Own It, an organisation that campaigns for public ownership of public services, urged the government to give the money it could spend on renewing private contact-tracing contracts to local authorities. “Local teams have the tools and the local knowledge they need to do this vital work before any second wave this winter. Now they need the money,” she said.

A Serco spokesperson said: “Serco was appointed to the test-and-trace programme under the Crown Commercial Service’s contact centre services framework. We gained our place on the framework through fair and open competition. Serco has played an important part in helping to reach hundreds of thousands of people who might otherwise have passed on the virus. Our team of call handlers has been 93% successful in persuading people to isolate where we are able to have conversations.”

A government spokesperson said: “As a result of public and private sector organisations working together at pace, we were able to protect our NHS and strengthen our response to this unprecedented global pandemic. Contracts have been awarded completely in line with procurement regulations for exceptional circumstances, where being able to procure at speed has been critical in the national response to Covid-19.”

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