G4S creates a few hairy moments for local screws

If the scandal over security at the London Olympics security scandal is any indication, Australians had better lock their doors tonight because prisoners could be out roaming the streets.

G4S, the same mob which has presided over the biggest security stuff-up in recent Olympic history, also operates prisons and prisoner transport services in Victoria.

Such is the magnitude of the security debacle which has rocked the London games that the British government has been forced to call in the army.

Just two weeks before the Games, G4S conceded it could not deliver the 10,000 security staff for which it had contracted, leaving the government to draft in 3,500 soldiers to make up the numbers.

Ironically, an executive of the firm, Ian Horseman-Sewell, had been boasting just two weeks before that of how G4S not only had the capability to cover the London Olympics but could also manage an Olympic Games in Sydney at the same time.

Now the firm is the butt of jokes worldwide and the farce deepens daily with the likes of a news story last week about two security personnel selected by G4S to guard Coventry City stadium. They turned out to be two illegal immigrants from Pakistan.

Business as usual

Yet despite concessions even from the G4S chief executive himself, Nick Buckles, before a British parliamentary inquiry that his firm's failure had been a “humiliating shambles”, it is business as usual for G4S in Australia.

Providing transport and security for prisons is a sensitive matter. Nevertheless, both the Department of Finance and Deregulation in Canberra and the government of Victoria are apparently not bothering with any review of G4S's contracts, or its competence.

Among the firm's major contracts are a deal to manage Melbourne Custody Centre and a big contract to operate Victoria's maximum security Port Phillip Prison at Laverton.

G4S also handles custodial, transport and security for Victoria Police. Its major operational entity within the group, G4S Custodial Services Pty Ltd, earned revenues of $131 million in the year to December 2011, of which the majority was made in Victoria.

Chief executive Nick Buckles, despite being lampooned as “G4S Head of Hair”, in reference to his bouffant hairstyle and bouffant management, led a 5.2 billion pound ($7.9 billion) takeover bid for Danish facilities management group, ISS, last year.

The move was dubbed “ambitious” at the time, especially as the Danish prey was larger than the British predator. Now, it seems downright foolish. Still, Buckles clings to his job, and not least because the G4S board would have to pay him 21 million pounds compensation if they were to push him out - another PR nightmare.

Meanwhile credit ratings agency S&P put the company on “creditwatch negative”.

“We recognise that the London 2012 Olympics is an extremely high-profile event and that the impact of G4S' underperformance could extend beyond the government sector and outside the UK,” S&P said in a statement.

BusinessDay reported earlier this year that G4S, along with a number of foreign multinationals with government contracts, had failed to lodge its annual financial statements on time and in accordance with the law.

Under its previous corporate guise as GSL, a prison van operated by this firm in Australia was transporting a 46-year-old Aboriginal elder from Western Australia in January 2008 when the man died.

The man, Mr Ward, died from heatstroke and dehydration as a result of being locked in the metal pod without airconditioning or water on the four-hour journey between detention facilities in summer.

Any government which holds contracts with G4S is on notice. Their performance doesn't match its rhetoric.

BusinessDay

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