Serco boss urges contract overhaul in wake of Carillion blow

The boss of outsourcing giant Serco has proposed “living wills” and a new code of conduct as part of an “urgent” overhaul of the public sector contracting market following Carillion’s collapse.

Chief executive Rupert Soames said outsourcers handling sensitive govern- ment contracts should sign so-called living wills setting out what will happen with projects in the event of the firm going bust.

A four-point plan outlined by the group alongside full-year results also suggests greater transparency on project progress, with updates every six months to ensure they are held accountable for the “delivery of their promises to the taxpayers who are paying for them and the users who they are serving”.

Soames – a grandson of Sir Winston Churchill and former boss of Glasgow-based Aggreko – said contracts should have an agreed “break fee” for both suppliers and the government to allow either to pull out if a project is not working, as well as a new code of conduct setting out expected standards of behaviour. He said: “We believe that there is an urgent need to rethink the relationship between the UK government and its suppliers.”

Hiscommentscameasserco reported bottom-line pre-tax profits falling to £19.1 million in 2017 from £29.6m in 2016. But it said underlying trading profit was “at the top end” of expectations at £69.8m – still a 15 per cent drop on 2016. 0 Rupert Soames is EX-CEO of Glasgow-based Aggreko