Thursday, July 4, 2019

As Court Decides Fate of Company, Transport Union Objects Again to Freight and Passenger Ferry Bid

Once Again Scottish Transport is Involved in a Major Dispute
Shipping News Feature
UK – Today (4 July) a subsidiary of the Serco group, Serco Geografix Ltd (SGL), will appear in Court with the Serious Fraud Office (SFO), in a bid to gain approval for a Deferred Prosecution Agreement (DPA) which will see the company pay a fine of £19.2 million together with £3.7 million related to the SFO's investigation costs. SGL has accepted responsibility for multiple charges of fraud and false accounting and the RMT Union has called into question the Scottish Government's relationship with Serco as the lifeline Northern Isles freight and passenger ferry service contract renews next month.

The RMT and Serco of course have a history, with RMT General Secretary Mick Cash having accused it of persistently ignoring safety and described the group in the past as, ‘basket cases’ and ‘specialists in failure’, a phrase he repeated this week, saying:

“Once again, Serco, the specialists in failure, have been found out. Fraud and false accounting are serious offences that should make any Government think twice about using private companies to deliver essential public services. Yet Serco continue their incompetent handling of new rolling stock on the Caledonian Sleeper contract at RMT members and passengers expense without the prospect of any censure from the Scottish Government.

”And on lifeline ferries, Serco have never been required to state the profits they take out of the Northern Isles Ferry (NIFS) contract they were awarded by the Scottish Government in 2012. Despite this, Serco could be awarded the next NIFS contract in August, when MSPs are on holiday. Workers, passengers and communities, especially in Orkney and Shetland, deserve the stability and certainty of a publicly operated and run ferry service, not another gamble on Serco Group’s predatory empire.”

The latest investigation by the SFO into Serco’s affairs apparently took six years and the group has been criticised in the past by Labour MSP for the Highlands and Islands, David Stewart, in a Parliamentary Motion (S4M-15236) over both rail and ferry contracts. Once again David MacBrayne and Serco are the only bidders for the new mainland to Orkney and Shetland Islands ferry contract, reputedly worth £619 million, which comes into effect on October 31 and will be announced by Transport Scotland in August.

The Serco press release regarding today’s Court appearance makes clear that the proposed fine is based on the fact that the company substantially assisted the investigation and self-reported offences. It also previously paid a settlement of £70 million in relation to the Ministry of Justice with regard to excessive profits taken from an electronic monitoring contract, the so called ‘tagging scandal’. It says also that nobody who sat on the Board of Serco Group, or who was part of the Executive Management Team at the time these offences were committed, works for Serco today.