We love learning from failure, but for some reason, aren't quite as interested in the lessons of success.
Success in offering at least the first part of the COVID vaccination to everyone in the top 4 risk groups, some 15 million people, by mid February is a major step forward and way ahead of any other country of similar size, or larger. It owes it's success to a mix of political leadership, intelligent (for a change) government procurement, excellent scientific advice, a venture capitalist parachuted in to head the programme, wicked old for-profit Big Pharma and that old fashioned public sector public service, the NHS. A big disappointment therefore to ideologues of both Left or Right. What was NOT involved was private sector delivery of heathcare, which has so often turned into disaster - SERCO's failed contracts for primary care in Cornwall and for Braintree Hospital, Circle's failed contract for Hinchinbrook Hospital, so many hospital PFIs that turned out to rip off the taxpayer and hamstring the NHS, and SERCO track and trace, though to be sure, that is a complex story, with the public's non compliance a major factor. All the more incomprehensible that the Govt want to press on with privatisation of healthcare services, the triumph of blind ideology over experience.
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So much liberal 'thinking on prisons is self indulgent slop. Like this piece here. Asks ‘what if we got rid of prisons?’ But then says, oh, we’re not really talking about getting rid of prisons. So why ask the question? A question you’re not actually posing at all? Because the writer wants to feel all daring and woke and radical. Without actually being any of that. It’s a fraud, in other words. Massively ignorant: “The prison population has risen by 70 per cent in the last 30 years. Few would claim society has got much safer.” Yes, it has, dickhead. Did you never hear of the BCS? Writer plainly does not know reconviction rate for prisoners has fallen steadily since late 2000s! Sloppy beyond belief: ignores all the purposes of imprisonment other than reducing reoffending. As though that is the only reason anyone would ever be sent to prison! Otherwise, he implies, a rapist, a murderer, we’d just give a fine, or maybe not bother at all. Appears to rely on poll by a marketing organisation that is not a member of the British Polling Council and appears not to publish its data, and whose ‘findings’ are inconsistent with many proper polls and academic studies. Talks up Bastoy but fails to note there is no published research demonstrating Bastoy’s effectiveness and that since Norway generally has low offending rates, it’s inevitable that it also has low reoffending rate, not an effect of its prison but different culture. And so on. I actually am against building more prisons. I actually am in favour of a smaller prison system. I actually think our prisons are in a terrible state. But precisely because I hold those views, and hold them strongly, I am dead against this kind of slop. Because it impedes serious thinking. Three pairs of films, from Japanese, French and Swedish cinema, that I sent to a friend recuperating from a major operation recently.
Tokyo Story was made in 1953 by the Japanese director Ozu. It figures on many lists of the greatest fims ever made. At first sight that's odd, because it's made in a very static style, completely at odds with western film making. Ozu uses his distinctiive tatami shot named for the reed mats used in traditional Japanese houses. The camera just sits there, at floor height, looking at the room people are in: seldom any close ups or reaction shots. He also used distinctive 'pillow shots' to punctuate the story when you see 2 or 3 minutes of a landscape completely unrelated, such as a steamer on a river, and when you come back to the story, often it becomes clear that something very important has happened meanwhile. Funny thing is, you quickly get used to the rules of his style. Ozu was much preocuppied with family relationship, in this case, the weakening sense of duty of children to ageing parents. The exception here is the dutiful daughter in law played by Setsuko Hari. She had a sort of daughterly relationship with Ozu and retired completely when he died in 1963, living in total seclusion til 2015! Her role as the submissive and self sacrificing daughter is at odds with our thinking today, but so central to Japanese culture. My wife and I both fell slightly in love with her. She somehow makes every other actress you've ever seen seem slightly....tawdry. The other film is Shoplifters, 2018, by Kore-eda. It's also about the idea of the family but in a completely different way! In fact the failure of traditional families is rather an obsession with him - another film is about the changes when two couples find their 6 year old sons were swapped at birth, another about a child abandonment case. The two French films are both about a boy who is an outsider, whose family ties have failed, and who embraces a life of crime and transgression. Both have somewhat inconclusive, and in a conventional way, unsatisfactory endings. And both feature a boy actor who had acted little or not at all, before, and who gave the single compelling performance of his life, before he really knew anything of acting. Truffaut’s Les Quatres cents coups (literally, ‘the 400 blows’ but untranslatable – in French, ‘faire les quatre cents coups’ means ‘to raise hell’), 1959, is about a young boy’s descent into a life outside the law. He was played by Jean-Pierre Leaud, aged 14, who’d appeared in one film already. His performance is extraordinary. The film launched the French New Wave. Truffaut became a father figure to Leaud and had him as lead actor in several later films in which he played the same character grown up, but as so often with child actors, the magic only worked once. For me an insight of this film is the terrible material poverty of France in the late 50s. Compared to now, it’s third world. It’s not just that they lacked washing machines etc, it’s that life itself seemed thin, bare, primitive. Malle’s Lacombe Lucien, 1974, is about a rootless peasant lad in SW France in 1944, seeking some sort of role in the war as played out in a small town. One could say it is about a boy with no insight, almost pathologically indifferent to what is going on - yet capable of some sort of tenderness towards the Jewish father and daughter he encounters. The dinner at with the Jewish father, already half looking forward to death, his beautiful daughter, the silent sick grandmother, reluctantly entertain the boy, by then a fascist gangster, is one of the most ambiguous in all cinema. I feel sure that none of the actors, nor Malle himself, really understood or controlled the strange currents of fear, desire, respect, contempt and tenderness that were criss crossing that scene. The boy actor had never acted before: he’d been a forester before. Yet he made such an intuitive success of a very diffiuclt role, a character who lacks character, who is in some way, empty. A non-actor acting a non-character. It’s remarkable. Sadly, success did not last, after a couple more films he bought a big car with his new earnings, crashed and died in it. The third and last pair of films is Swedish, by the great man of Swedish cinema, Ingmar Bergman and by his son Daniel. Ingmar Bergman’s Wild Strawberries (1956) is about an old man coming to terms with a life not well lived, in which his status and accomplishments count for little weighed against his missed opportunities for love. He does so in the course of a long road trip from Stockholm to Lund across beautiful coast and countryside of Sweden (even though it’s in black and white). Along the way, reveries and the people he meets help him understand himself a little better. Maybe even begin to forgive himself. It’s in a superbly clean new print, for years we only had a scratch old version. Peace comes at last, as he revisits his childhood. It’s one of my very favourite films. At the end of his life his son Daniel directed Sunday’s Children (1992), which was written by his father Ingmar. It references the same kind of childhood in the Swedish countryside – clearly this is Ingmar’s own story – but It’s the reverse of Strawberries. Here, the moment of reconciliation existed in the past, in childhood, but is forgotten by father and son in old age. (Irony here, since Ingmar himself was a notoriously bad parent). What’s the opposite of ‘coming to terms’? Here, in short, are two ideas of the meaning of life – as something one progresses slowly towards via experience and age; and as something that exists, if at all, in the moment lived, which is not somehow stored up or accumulated for the future. The performance of Henrik Linnros, then aged 9, as the child is remarkable. I’ve often wondered how an earth you direct a child of that age. Or do you just left them be themselves? Like so many child actors, his career did not live up to its beginning. Daniel Bergman eventual gave up directing – in which he was accused, inevitably, of benefiting from his father’s name – to become a paramedic, saying that he would do more good that way. It’s even possible that his medical work saved more lives than those driven to suicide by his father’s existentially tortured films. This NAO report is far too kind.
The MoJ is a disaster area. Today, every part of the criminal justice system is in deep crisis, as a direct result of a decade of disastrous cuts made by Tory Ministers, exacerbated by civil service mismanagement. All of it pre-dating COVID – no hiding behind the pandemic. MoJ finances have been appallingly managed, with a continuing overspend of £1bn ever since 2015, and the NAO show that even an extra £2bn a year has STILL left the Department overspending. The Tories cut prison staff by a third, criminal legal aid by a third, CPS budget by a third, police numbers by 22, 000. Officials have botched project after project, including many designed to yield cost efficiencies: privatisation of probation was a disaster requiring emergency renationalisation, likewise FM with the collapse of Carillion, the 2016 programme to build 9 new prisons and open 5 by 2020 produced not a single one, as MoJ and HMT shuffled paper in doomed attempt to buy them on tick (PFI), the cost of Glen Parva new prison ballooned by 70%, the Oasis secure school is delayed by uncertainty about charitable status, MoJ failed to stop SERCO and G4S stealing £200m of public money and then covered up their own incompetence, successive attempts to procure new tagging contracts collapsed, the court transformation programme has slipped, savings are not being achieved and forced reliance on online hearings as courts are sold off to save money is disadvantaging the most vulnerable, nearly 1 in 4 legal aid firms have quit. Even now, the NAO report, a majority of MoJ's key projects are rated as amber or red. The results: prison violence and self-harm soared threefold, the court backlog was already 600,000 before COVID struck and cases are now being listed two years ahead, police clear up rates are at the lowest recorded, only 1 recorded crime in 12 resulting in charge or summons, far fewer if you count crimes not reported. The system is broken. The MoJ isn’t just troubled: it has become the very emblem of the UK as a failed State. The case for a fundamental review of the working of the CJS is urgent as never before. Billions are needed to restore basic functioning. But the promised (but much delayed) Rotal Commission will take place at a moment when due to the monstrous economic self harm of Brexit (another Tory triumph), as well as the downturn due to COVID, and coming soon, the possible breakaway of Scotland from the UK, prompted by Tory indifference to the Union, there will be no possibility whatsoever of big, sustainable increased spending on criminal justice. Moreover all the Tories know how to do is endless ratchet up demand on prisons, the most costly, least worthwhile element of the CJS to put new money into. We are up shit creek without a paddle and the captain, ‘Unacceptable’ Buckland, doesn’t even know it. I've been thinking of how different Lockdown II is from Lockdown I. I am reminded a lot of civilian war diaries and letters in WW2. (If that analogy strikes you as a bizarre, even tasteless, think of the similarities – same number of civilian dead, England isolated from a suffering world, difficulties of travel within the UK…). At the start of Lockdown I, as in 1939, there was more fear than there is now, because all was new and nothing was known. We washed fruit as it came through the door and were scared to go to the allotment, just as in 1939 people thought entire cities would be destroyed and gassed. It was scary, but also thrilling in a way. We really did felt ‘in it together’, were pleased and moved to find neighbours looking after one another, we clapped for ‘heroes’, there was strong, instinctive compliance with the rules. There was also a wonder - Nature remontant – and we thought that we would learn from this and be kinder to Nature and to each other ‘afterwards’. Initially, we thought only of the next 6 months and how to survive it, beyond that we could not see, and dared not try. "I'm so glad Mr Burey is a fatalist. We were one gas mask short' Now it’s, what, 1943, or early 44. We’re just so tired, weary, numbed not so much by the death count as by privation, restriction. It’s so long since we could do what we enjoyed and our previous lives seem a distant memory. We long for a bit of colour, a bit of variety and entertainment in our lives. We’re less scared now, true – we know exactly what to do to avoid death and what not to bother with – consequently we can live a little easier. And we know, in late ’45 or ’46 or sometime, that we will eventually ‘win’, once the vaccines become available. But we are so damaged by the experience that we’re not entirely sure what ‘peace’ will be like once more. The State is nearly bankrupt. And that sense of community has long gone. We cheat, we denounce others for cheating. Spivs and charlatans abound. Morality is less certain. "And then to make absolutely sure, we always sit in the dark"
Some differences. Big ones. Of course, we don’t have a third of a million-war dead. We havent suffered near famine of massive shortages or long queues. But a lot of negatives, too. In the course of the War we became more trusting, not less, in Government. Government became more competent, not less. There were spivs and crooks aplenty in 1943 - but they were not running the Government. We did not, in 1943, have a sizeable minority advocating capitulation to Hitler, as some now do with COVID, peddling nonsense about our radios attracting V bombs. And by 1945 we were much more confident about our future – we thought that though hardship would continue short term, we could build a much brighter, more just, more sustainable future than before the War. No one thinks that now. We’ve already shown that our contempt for Nature is more destructive than ever, and we know that when the COVID peace comes, the next catastrophes, environmental disaster, are following close behind. And we are planning now not a brave new world order, but ever great isolation from Europe, from the whole world – we can wait to shut ourselves off in this little island. No one likes us. No one looks up to us, as they did so much in '45. We have learned nothing from this war. Nothing whatsoever. G4S has admitted a serious and sustained fraud again the public purse dating back to the early 2000s, in relation to its contract with the MoJ for electronic tagging of offeners. But in July this year, G4S was able to buy off prosecution for fraud, by paying £44m - a process called a Deferred Prosecution Agreement (DPA), which has to be signed off by a court and published. The judgement on the G4S DPA, here, (as in the similar one with SERCO last year, here,) reveals much not only about the criminality of G4S, but the contributory negligence of the MoJ as customer which enabled the fraud, and the extraordinary slowness and high cost of the Serious Fraud Office (SFO). It also casts doubt on whether the DPA was properly made in this case, and indeed, whether DPAs are even compatible with most peoples’ idea of ‘justice’. What are DPAs? DPAs were imported from the American judicial system by the Courts and Crime Act 2013. The background was the abysmal performance of the UK authorities in dealing with economic crime, highlighted by the financial crash of 2008. UK US. The SFO in particular was under fire, following collapse of yet another major trial (the Tchenguiz brothers), due to a series of very basic failures to follow procedure, and its own governance was questioned after an unauthorised pay off to top staff. This was the reasoning: prosecuting economic crime is difficult, slow, expensive and cases often collapse embarrassingly. A major obstacle is the legal doctrine of ‘directing mind’ which requires it to be shown that employees of the company committing the crime are in fact acting as the company. Also, detecting such crime in the first place and securing evidence is difficult, given the absence of any incentive for the company itself to own up or cooperate with the investigation. The idea of the DPA was that instead of prosecuting the company, the prosecuting authority would invite it to do a deal under which the company would recognise wrongdoing, cooperate fully, hand over all evidence, pay a financial penalty and implement under supervision measures to improve corporate governance. (A DPA only avoids prosecution of the company itself - individuals who worked for the company may still be charged and in a number of cases, have been.) Such arrangements are familiar in the USA, but the murkiness of deals done there behind closed doors worries British jurists. To answer such qualms, the DPA as introduced here has to be signed off by a court, and has to be published, while the rules governing its use are set out in a published Code. DPAs do not apply to individuals, and apply only to economic crime (not for example, environmental crimes). There has been widespread criticism of DPAs (though mainly by City law firms likely to be batting for the accused eg here). Much of it centres on the tension between avoiding prosecution of the company, while prosecuting individuals who worked for it. In the Rolls Royce, Tesco and Guralp cases, criminal prosecutions against former officers of the companies fell apart. Indeed, no individuals have ever been convicted of the wrongdoing that prompted the investigations which led to any of the DPAs. Critics say this leaves a conundrum that a company has publicly acknowledged very grave criminal offences and paid a lot of money by way of reparation, but seemingly no actual person was criminally guilty of any wrong doing. Shareholders ask why, then, so much of their money has been paid over – indeed in both the SRCO and G4S cases, shareholders threatened legal action against the company, in relation to the effect of the fraud on the share price, here and https://www.law360.com/articles/1236163/serco-shareholders-sue-over-stock-dive-after-fraud-probe. Other critics are concerned that individuals at risk are not properly protected during the company’s internal investigation, or in the disclosure of evidence to the SFO, are excluded from the negotiations with the SFO, and if acquitted, have no way of removing the taint implied in the DPA agreement, since it has alreayd been declared that the conduct was criminal, a case of 'verdict first, trial later'. There is concern that it may suit the SFO and company very well to throw a few individuals who may not have been the prime movers to the dogs – ‘look, there go the rotten apples, good riddance, problem solved’. A constant throughout the period is the glacial pace of SFO investigations and the high failure rate of its prosecutions. In fact, in 2017 the Tories made a manifesto commitment to abolish to SFO and hand over its functions to the National Crime Agency, but immediately dropped the idea on returning to power, proposing instead to rethink its whole approach to economic crime, a rethink that has continued ever since, if ‘think’ is the right word for a Government so adrift on every issue. Apparently the MoJ are too busy with Brexit to do much thinking. A recent Lords report again slammed the legendary slowness of the SFO here, while the SFO have quietly dropped a further slew of major investigations that have been underway for years (Rolls Royce, GSK), here. Successive heads of the SFO, and many commentators, have proposed to tackle the problem of proving a ‘directing mind’ by creating a new offence of ‘failure to prevent’ economic crime, such as already exists for bribery under s.7 of the Bribery Act 2010, which used this formula specifically to make it easier to prosecute without having to prove the ‘directing mind’ was at work. Instead, what would be at issue is whether the company had in place adequate procedures to stop the sort of criminality. In fact, an attempt to introduce the same concept to fraud was mooted during passage on the 2013 Act, but shot down by the Government. And the idea has now disappeared into the black hole that is of the MoJ. In any case some critics have doubted that this is the best solution here . Some argue that the 19th century legal doctrine of 'directing mind' is antiquated in an era of large, complex company structures and also needs to be undone. Curiously few have raised the moral question, whether it is actually right for the State to let big, wealthy companies buy off prosecution for very serious crimes, especially crimes against the State and the taxpayer. I return to that issue at the end of this article. Recap of the story so far There has never been - and will never be – any public inquiry, so many facts about the case aren’t known and may never be known. The National Audit Office reported on the issue in 2013, but because of the SFO investigation, could not take it very far. An internal MoJ investigation was started, but immediately dropped, for the same reason, and has never been proceeded with (see chapter 5 of my book). G4S has submitted a Statement of Facts to the SFO but of course, that will never be published. The sub judice rule is a great friend to those with embarrassing secrets to hide, above all, the MoJ itself. Thus, we are a long way from knowing the full story. We may hope that a deal more comes out when ex-officers of SERCO and G4S come to trial – if they get to court. The SFO’s inglorious history of cracked trials and cases dismissed does not inspire confidence. Briefly: electronic monitoring of offenders (‘tagging’) was introduced by the Home office (before this work moved to the MoJ) in the 1990s, and was contracted out from the start (it has never been done in-house). SERCO and G4S quickly became dominant players, sharing the tagging market between them. They also ran prisons, prisoner escorting services, youth custody and immigration custody, becoming ever more deeply entwined in our justice system. Between them they earn hundreds of millions a year from MoJ and the Home Office. MoJ has allowed a tri-oploy to develop for running prisons, Serco, G4S and Sodexo. So, the customer is highly dependent on these two companies, indeed the market in detention and correctional services would collapse without them. In July 2013 the then Justice Secretary, Chris Grayling, told a shocked Commons that in the course of preparing for re-tendering of the contracts, his Department had uncovered serious over-charging by SERCO and G4S going back some years. The matter was referred to the SFO. Here we are, a mere 7 years later, with a decision not to prosecute the company. What this DPA reveals On 17 July Mr Justice Davis signed off the DPA between the Serious Fraud Office and G4S, under which the SFO agreed not to prosecute G4S for defrauding the Ministry of Justice, in return for G4’s payment of £44m and commitment to various improvements in its corporate governance. The same judge signed off a similar deal with SERCO a year ago. What this document reveals is extraordinary and deserves wider circulation. 1) G4S charged millions for work it didn’t do. But this was entirely legal! At the time the scandal broke, it appeared that it consisted of G4S (and SERCO) submitting invoices to the MoJ and being paid for them, for work which the company knew perfectly well had not been done. Thus the Justice Secretary to the House: “It included charges for people who were back in prison and had had their tags removed, people who had left the country, and those who had never been tagged in the first place but who had instead been returned to court. There are a small number of cases where charging continued for a period when the subject was known to have died. In some instances, charging continued for a period of many months and indeed years after active monitoring had ceased.” This was the assumption in the National Audit Office report in 2013, which detailed some of the ways this was done. For example, they would continue to charge even if they knew perfectly well the offender had absconded, if there were no order to cease – even though of course they knew they were no longer supplying the service charged for. They would continue to charge even after failing to install the tag successfully, so they knew they were not providing a service. Yet in July, the court declared that this was not fraud. Why not? First because the MoJ changed the contracts in a way that invited such conduct. As described in my book, there had been a problem that in the case of those tagged on remand, the date for cessation was the date fixed by the court for reappearance. But in practice, that merely lead to another period on remand. In the meantime, the contractors might have removed the tag, thus necessitating another home visit to re-install it. It appears – this is among the murky secrets never now to be divulged – that the MoJ responded by altering the contract, so that no expiry date was set, on the assumption that the court would order cessation when they finally committed the defendant for trial or discharged him. (The operators inserted their own expiry dates – SERCO set theirs as….the year 3000. Talk about a long-term income stream!) But predictably, courts didn’t bother to cancel orders, not having much interest in that side of things. Consequently, orders remained in force even though the offender might be at liberty or back in jail or even dead. The operators knew this. But they carried on milking the MoJ. It was an act of appalling dishonesty. But not it seems unlawful. It appears that such dishonest practices constituted most of the £180m which the companies paid back under duress in 2014 once they’d been found out. (Though just what that £180m comprised is yet another truth that will never be told, but in the case of G4S, some payments relate to other contracts where over-charging had been discovered, here: so this wasn't an isloated case). 2) Because the companies told the MoJ what they were doing. And the MoJ did nothing. The NAO report (2013) states: “G4S has stated to us that…the Ministry should have been aware of the way in which it was billing, and that it provided written explanations to the Ministry in 2009 that reflected its interpretation of the contract…” and “SERCO has stated to us that it charged in line with its genuine interpretation of the contract and that it was open about this to the Ministry throughout…”. That much was stated by the Justice Secretary in announcing the discovery of the fraud to Parliament in 2013: “The audit also reveals that contract managers in the Ministry of Justice discovered some of the issues around billing practices following a routine inspection in 2008. Although it appears that these contract managers had only a limited idea of the scope and scale of the problem, nothing substantive was done at that time to address the issues. None of that, however, justifies the billing practices followed by the suppliers.…..The House will … be surprised and disappointed, as was I, to learn that staff in the Ministry of Justice were aware of a potential problem and yet did not take adequate steps to address it.” That, I believe, is what made charges of fraud impossible, in relation to charges raised for work not done. Because the companies told the customer what it was doing. And the customer, it appears, did nothing whatsoever about it. 3) What was illegal was G4S’s falsification of financial reports, over a decade, to conceal excessive profits which it was legally required to share with the taxpayer When the first-generation of tagging contracts were due for re-tender in 2003, the Home Office (then the customer) was concerned that volumes and thus sending was rising. In an operation of this kind, some costs are more or less fixed whatever the volumes, other costs may rise, but not in direct proportion to rising volumes. Therefore, unit costs should fall. So, the Home Office asked bidders to disclose their true costs, so as to guard again excess profits. Each company was required, by the contract, to state annually its true margin to date, and expected future margin. The contract provided that if excess profits developed with rising volumes, the contractor must disclose these and so that the price could be adjusted. The contract required the companies to ensure these returns were ‘true and accurate’. From the start, before the contract even started, G4S lied its head off, sending in false returns that concealed its true costs and profit. It continued lying until found out. This schedule, from the judgement on the DPA, helpfully sets out the difference between the profit as disclosed to the Ministry, and the true position. 4) Even so, it was obvious that excess profits were being made, exactly as the MoJ had feared – but again, they did nothing
The customer had started the contractual process by stating its concern that the cost should not rise in direct proportion to rising volumes, but that ‘efficiency gains’ should be declared and shared with the MoJ. It was obvious, year after year, that the costs were rising in proportion to volumes (see my graph here https://www.julianlevay.com/articles/a-curious-graph ).But apparently officials did nothing to probe this, nor to ask how it was that G4S’s costs were rising in line with volumes. It is almost as if the MoJ had lost interest in the existing contracts as they prepared to re-compete them (indeed in cross examination later by the Public Accounts Committee, the then Permanent Secretary admitted as much (my book, chapter 5, footnote 13.) 5) The SFO took seven years and £6m to reach their decision not to prosecute G4S The scandal broke in 2013. It has taken the SFO 7 years to decide not to prosecute G4S. Granted the SFO is a by-word for sloth and incompetence, this is extraordinary. A year longer than World War Two. What were these people doing? After all this was not a complex case: only one company; only one customer; only one contract; no foreign jurisdictions involved, no fugitive suspects. Nor is this so unusual. In July 2018, the SFO disclosed that of cases currently under investigation, half had already been under investigation for more than 4 years (answer to my FoI request). Last month, 3 G4S executives were charged with fraud, 7 years after the case was referred to them. Does this extraordinary sloth matter? It does. ‘Justice delayed is justice denied’. Whatever one thinks of them, it is unpardonably oppressive to leave the G4S staff in question, and their families, and maybe others, under threat of serious charges for 7 years – 7 years during which they must have found it near impossible to get work in that sector. Such delay also means that memories will have decayed and that may cause evidential problems in court. It also means that for 7 years, Government has been awarding more contracts to an organisation facing trial for fraud against the Government. If the charges against individuals proceed to trial, it is unlikely that this saga will conclude before 2023, and if there are then appeals, 2024 or 2025 – more than two decades after the fraud started and a decade or more after the SFO started work. This is ludicrous, incompetent and oppressive, in such a straightforward case. 6) In secret, the MoJ lobbied against prosecution Bear in mind, what follows was all done in secret. The only reason we know about it, is that it was disclosed by the judge. Mr Justice Davis states the SERCO DPA last year that “the SFO has argued that the public interest would not be served by [SERCO] being debarred from participating in any government procurement exercise…This would be the consequence…were there to be a conviction, whereas it might not follow in the event of a DPA being approved”. This clearly can only have come from the MoJ. And in the G4S case, Mr Justice Davis quotes a statement by the MoJ’s Chief Commercial Officer’s saying that exclusion of G4S would have a of the ‘detrimental effect’ on the market for justice services. It is difficult to see these interventions other than as an argument against prosecution of the companies. Why else make them? In practice, the Judge worked out that in reality, exclusion of the companies from procurement following criminal conviction under the Public Contracts Regulations 2015 is not mandatory but discretionary – and Cabinet Office told the court that conviction would not necessarily result in such disbarment. So it is not clear that the MoJ’s intervention was even relevant. Nevertheless, the fact of MoJ’s intervention is telling. Not least because it is the MoJ itself which is responsible for its high degree of dependency on these 2 companies, so much so that even in the case of sustained and admitted fraud against the public purse, the MoJ cannot sustain competition without them. When I was FD of the Prison Service, we reckoned that to sustain effective competition for prisons we needed 4 established competitors. That was achieved. Then in 2008 a merger redirected that to three. Since then, the MoJ has repeatedly invited other companies – MITIE, MTC and others – to bid, and repeatedly awarded those contracts to the Big Three. The tri-opoly is the MoJ’s own doing. Result: SERCO and G4S are now it seems ‘too big to prosecute’. Government and outsourcers have become co-dependent. 7) This DPA does not fit the criteria laid down, and should never have been made In this case, the 'identification principle' was satisfied ie the doctrine of a 'directing mind' was not an obstacle to charging the company. There was a choice - to charge or not. So how was the decision made not to charge? The 2013 Act introducing DPAs provided for a Code of Conduct to be issued governing their use. That Code sets as factors relevant to the choice between a DPA and prosecution:
The Judge listed as factors tending towards prosecution:
In short, much of the case against prosecution of G4S seems ill-founded, if not downright perverse. There is a further and more basic point: the interests of justice. The Judge concluded that the DPA rather than prosecution was ‘in the interests justice’. Why? Because G4S had admitted criminal behaviour, repented, paid back its gains and undergone ‘cleansing’. He argued that ‘this will protect the public…in a manner more effective than any prosecution…’ He also argued that ‘the absence of a conviction will not affect substantially any damage to the substantially reputation of the company’. That statement is nonsense. The conviction of G4S for fraud against the UK Government would have had a devastating effect on its reputation here and around the world, indeed the ability of governments, including even this one, giving it contracts. As a sanction, the fine is irrelevant. Half a per cent of turnover. It’s nothing. And one of the fundamental objections to this DPA is that for the people of this country there is a huge difference between paying bribes to secure contracts abroad, in countries where bribery may be common, even an accepted way of doing business, even essential if you want to do business, and systematically stealing money from the British taxpayer. All the more so, since these people were trusted to supply vital public services. This should have weighted the decision towards prosecution. In my view, G4S ought to have been prosecuted. That, I am quite sure, would have protected the British public in a manner more effective than this glorified probation order. 8) DPAs are a conspiracy of the powerful and rich against the public good I return now to the nature of DPAs themselves. I have explained why they were introduced. The primary reason is that companies are difficult to prosecute for fraud, and the primary reason for that (apart from the incompetence and dilatoriness of the SFO) seems to be the legal doctrine of ‘directing mind’. The solution to these problems is not to avoid prosecution, but to make prosecution possible. First, as so many observers have argued, to import the ‘failure to prevent’ device into the law on fraud. Second, to modify or do away with the outdated doctrine on ‘controlling mind’ (which seems to be a British peculiarity and doesn’t exist in the US). Third, to replace the SFO which has failed so many times over decades to do its job promptly or competently. As I noted, few commentators have asked the most obvious of questions about DPAs: why is it right for huge rich companies to be able to buy off prosecution, while you and I cannot? True, we may be offered a caution, if we admit an offence and make restitution: but with this difference: it’s only available for the most minor offences. Not for stealing millions. Here’s why I think DPAs are immoral and unjust. It’s from court results in my local paper: LUKE *****, 34, of Banbury Road, Oxford, admitted stealing alcohol valued at £41 from Sainsbury’s, Oxford, on April 29. He must pay compensation of £41. Luke has been convicted of a very minor crime indeed, and has paid compensation, but also now has a criminal record. Why haven’t G4S and SERCO, who stole many million times as much? Are they just too big, too rich, too powerful to be prosecuted? 9) There never has been any inquiry into the negligence of the MoJ which enabled this fraud As I’ve noted, the effect of he unbelievably protracted SFO investigation is that the MoJ terminated its disciplinary inquiry into the seeming malfeasance of its officials who apparently knew the G4S and SERCO were charging for work done but did nothing about it (and did not tell Ministers). Nor any investigation of those charged with monitoring contracts who failed to react to the fact that tagging volumes were soaring but unit costs not falling, exactly what MoJ was concerned to avoid. Nor of those who changed the contract to remove the mechanism which stopped orders continuing indefinitely, yet took no steps to guard against the abuse that they had made possible. Ah yes: those responsible have ‘moved on’. Tell me, why is that always a defence for officials (and their ministers) but not for those now charged in G4S and SERCO? 10) We will never know the full facts The NAO investigation in 2013 was very limited by the sub judice rules (and did not in fact spot the real substance of the fraud at all). It cannot resume because of the cases now coming before the court. By 2022, it will all be forgotten. So, we will never know the full facts. And if those cases fold, we wont even know much about what went on inside G4S and SERCO. Of course, the SFO know, and the MoJ know – it's just you and me (and Parliament) who mustn’t know. How could it take the Serious Fraud Office 7 years to decide NOT to prosecute G4S for a £100m fraud against the tax payer?
Of course, the SFO is a byword for delay "For a thousand years in thy sight are but as yesterday when it is past". But even so...in this case, one of the most uncomplicated frauds one can imagine (2 contracts, one customer, one jurisdiction): 7 years? Longer than WW2? There's a clue in the hearing a year ago on the agreement not to prosecute SERCO for a similar offence. "The SFO has argued that the public interest would not be served by [SERCO] being debarred from...any government procurement excercise...This would be the consequence....were there to be a conviction...." The SFO ie the MoJ had been desperately seeking ways to AVOID prosecution - because they need them as much as SERCO/G4S need Government. Too big to fail = too big to prosecute. Beyond the law. Outsourcing has corrupted the British State. Richard Heaton, Permanent Secretary of the MoJ, appeared before the Public Accounts Committee on 29 June to give account for his Department’s failures on management and expansion of the prison estate, set out in a recent National Audit Office report. The Chair and a member of the Justice Committee also attended, a useful innovation, since there is so much common interest. Heaton was accompanied by the Chief Exec of HMPPS and the Deputy Director of Prison Maintenance and Change. He did not bring his FD, Mike Driver, surprisingly, since the talk was largely about money. [But perhaps someone had recalled that at a previous session, Driver told a gobsmacked Justice Committee “I would say that we have a very good financial management regime within the organisation.” That would not have gone down well on this occasion.] The hearing was never going to be easy. Because what the NAO reported was that prisons remain dangerously overcrowded, with a big mismatch between the type and location of available and places needed, that the programme to create 10,000 new places by 2020 had created precisely 206 places, with not one new prison opened, that a ballooning budget deficit of near £1bn a year had meant available capital had to be switched to current, that plans to close old prisons with poor conditions had almost entirely failed, that MoJ had failed to keep pace with a rising backlog of essential maintenance, so that an increasing number of places had to be taken out of use while conditions in many prisons were appalling, and that contracting of FM had been an unmitigated disaster ending with the collapse of Carillion, and all this while prisons were less safe, less decent than they had been for many decades. Now you might think that if that was the wicket you were going in to defend, you’d have sent hours and hours mastering the facts, preparing your response to the inevitable criticism and to shoulder responsibility for this avalanche of failures. But not Richard Heaton. In all my years as a civil servant, and my own appearances before the PAC and other Committees, I have never seen anything remotely like it. Heaton had not mastered quite basic facts, did not appear to feel that he personally had anything to answer for, did not seem to think that anything – including the Committee- mattered very much. He was not, however, short on explanations for all these disasters. Turns out that it was either all someone else’s fault – impliedly, his immediate predecessor, Ursula Brennan's - or alternatively, the fiscal equivalent of the wrong sort of snow. Here is the complete list of his excuses:
“My predecessors landed me with this shit” plus “Fate was unkind to me”. Not me, Guv! Heaton has obviously never heard the maxim that when things have gone really badly wrong, 10 excuses are 10 times less credible than 1. Or that the most powerful defence in the language is, “I’m sorry, I got it wrong”. When Shabana Mahmood rightly pressed him to be a bit more precise about how the Department came to get so many things so wrong, Heaton replied: “Maybe we suffered from group think…maybe we were not rigorous enough, maybe our forecasting was not good enough, but without a historical exegesis…I do not think I can be more precise than that”. The mandarin equivalent of ‘whatev’. But I do believe him. I do accept that he is quite unable to be more precise. For indeed Heaton is not a man for detail. How many places would the 4 new prisons just announced give? How many prisons hold women? Could MoJ do lease back of new prisons? How much had he got for Holloway? Don’t ask me. Why did you underspend on maintenance by £24m? The answer: “..we did not see the figure. We just cannot [inaudible] where the underspend was”. Don’t ask me, I’m only the Accounting Officer. If all his evidence had been inaudible, we might be better informed. His language was striking. Heaton seemingly wishes to appear hip, relaxed, casual, none of that old-world Sir Humphrey stuff. In so doing, he seemed to me to signal a fundamental lack of seriousness and respect. The FM and probation contracts were ‘kind of doomed’. Oh, well, that’s really helpful. The 2019 budget “gave us the money we needed to keep the lights on” and “a good slug of capital” (Heaton the fiscal alcoholic. “Gimme anther slug, willya. And leave the bottle!”) When it comes to the future – which Heaton much prefers talking about than all that dead old history, man – Heaton is as rhapsodic about the wonders to come as he is short on details, such as when, or at what cost, or what risk. The Justice Committee chair, pressing him, says ‘There’s no overarching strategy for dealing with any of these things, is there?’ Heaton replies that the Committee has had ‘the ingredients of a strategy’ and that “I hope you would not observe a lack of strategy if you were to revisit this, I say in 6 months” i.e. after I’ve escaped. Towards the end Heaton became quite the visionary: he hoped MoJ would carry on way beyond the 10,000 new places, building more and more prisons…glorious. (No sense at all of the fiscal, social indeed moral case for not having more and more prisoners. Or of the long experience that if you build more capacity, some politician will fill it up again, and then overfill it.) Heaton has however given us more insight into the extraordinary catalogue of failures in MoJ in recent years than he thinks. An organisation headed by such a man, a man without the least concept of what leadership entails, a man so disdainful of detail, so unable to take personal responsibility, could never flourish. The MoJ rotted from the top down. The story extends to two other serious failures. As ever when someone fails in a job by so wide a margin, questions must be asked about those who appointed him – and who kept him in office when it was clear it was quite beyond him: Cabinet Secretaries Jeremy Heywood and Mark Sedwill. Why did Heywood appoint someone so unsuitable by reason of his experience – Heaton was a Government lawyer of no real management experience – and temperament, to a massively difficult management job, £8bn complex spend and a huge variety of services, employing 70, 000 or so staff right across the UK? This is more than bad judgement in one case. The mandarinate have never really squared two completely different jobs at Permanent Secretary level: giving advice to Ministers (not that they seem to want it much, nowadays) and dealing with Parliament, media etc on the one hand, and managed huge, complex, costly public services under great stress. The Agency concept was an attempted solution: separate the two out. That worked well until MoJ brought all the corporate and support services, including procurement, back to the centre of MoJ, with on the whole, bad results. This matters: insiders tell me of crucial discussions about funding andmanagement of prisons from which those with operational experience were excluded. And I know from my own time how necessary their input was when the going got tough. Second, there is another failure here: the failure of the PAC and Justice Committees to do their jobs. As an interrogation of the chief of Department where financial control has broken down, where public services had been badly damaged, where contract after contract has gone bad, their sessions were laughably shallow. As I have noted before (1), this is partly this is the inevitable result of rushing through so many inquiries in a Session, and of interrogation by a Committee of members, each with their own personal interests and issues. It is also the case that so long as Committees only call those currently in post, and absolve their predecessors, it will be to easy to maintain, as Heaton did, that it was all the fault of those who came before, and that all he did was try to clear up the appalling mess they left, disgusting, isn’t it, some people! Committees should have power to call predecessors in post (but then they’d have to call Grayling, wouldn’t they?). It would have been interesting, for example, to hear Ursula Brennan's response. And that exposes a delicate cultural issue too. The PAC has the reputation for being fearsomely tough and critical. And appearing before it is quite a challenge. But I’ve noticed again and again, how Committee members, especially chairs, seem to want to avoid too direct a challenge. I noted that in my book, regarding the misappropriation of £200m by SERCO/G4S (1). I note it again here. Here’s the chair to Heaton: “glad to hear you are so upbeat” and offering him “muted congratulations from the PAC” (for what!?). And then cutting off Mahmood, who seems one of the sharper minds on the Committee, in mid-sentence as she told Heaton that MoJ’s litany of failures were ‘inexplicable’: “I think, Ms Mahmood, this is also about, once a mistake is made, how long it takes to unpick it, which is a salutary lessons for Whitehall and Westminster indeed”. “Whitehall and Westminster indeed”. Indeed. As I have often noted, for all the conflict that their can be between Ministers and top civil servants, there is also a profound and (for the laity) sinister congruence of interests. Neither are keen for awkward truths to get out, or to spend too much time analysing the fruits of their actions and decisions. That was surely the real burden of ‘Yes Minister’. It is the price we pay for not separating out Executive and Legislature. Not much less than afifth of MPs are the Government payroll - and maybe another fifth hope to be soon. The watchdog is self-neutering. In talking of Heaton’s and the MoJ’s failure, I do not - of course - suggest that failing is in itself morally blameworthy. I am not Michael Howard. Anyone who thinks they’ve never failed is a dangerous fool. In my book, and since, I’ve made it clear that I made mistakes in my time. The question is, do you scrutinise your own record, do you own your failure, do you show remorse, do you put it right, do you learn. I don’t think, on this showing, that any of those things can really be said of Heaton. Heaton will shortly, leaving almost every part of the justice system in a worse state than it has been in living memory. Likely he will be replaced by some creature of Cummings choosing. MoJ must be dreading his or her arrival. But then, could they really do any worse? NOTE (1) My book, ch. 5 Robert Buckland is going to build another 4 prisons. Unfortunately, he has forgotten quite why.
A degree of amnesia is perhaps understandable. A succession of Tory Ministers has been announcing plans to build 10, 000 new prison places for such a long time, it’s almost become a ritual divorced from reality, like Harvest Supper. Let’s help restore that memory! Nearly 5 years ago, Michael Gove announced plans to build 10, 000 new places in 9 new prisons. That would have allowed old prisons with poor conditions and facilities, and high running costs, to be closed, demolished and those sites used to build 3, 000 new homes, the sale receipts partly paying for the prisons. In the process, the estate would be configured to better match demand and supply. New gizmos would make new prisons whizzier. It really was a most cunning plan. A few months later, his successor, Liz Truss, confirmed the plans, promising 5 new prisons would be open by 2020. That is to say, today. The number actually open today is…none. Just two are being built. They will open in 2021. Why did the plan fail so spectacularly? After all, in my day we built and opened new prisons within 40 months of going to tender. Though we were never quite so stupid as to plan to open 5 prisons in one year, knowing how difficult it is to open a new prison (none more so than the last publicly built and run prison, Berwyn, which remained troubled and half empty for years after opening). But back then, HMPS was headed by people who knew all about prisons, as opposed Jo Farrar, who knows all about running Bath Council, and prison building was handled by HMPS itself, not the incompetents who inhabit the centre of MoJ nowadays. The reason for the failure was MoJ’s almost unbelievable incompetence. As the NAO helpfully documents (they’ll have to go, won’t they, Dominic?), two full years was spent shuffling paper back and forth between MoJ and Treasury. MoJ’s disastrous loss of financial control (see here) meant that capital had to be switched into current to plug the £1bn deficit in the budget. MoJ therefore had to look to private finance, not because it was better value, but because the cost could be spread over 25 years (prisons on the never-never). But (as I explained in my book!) PFI was never going to look as good as it had in the ‘90s, now that the public sector had got much improved its ability to build faster and cheaper, while the cost of public borrowing had plummeted. So HMT rejected their proposal. And then pulled the rug out from under MoJ by abolishing private finance altogether. So, back to the drawing board…. Last August, Buckland, Truss’s successor but two (do keep up!) announced (again) a programme to build 10,000 new prison places. No, not those 10,000. Another quite new 10,000. No dates promised this time – someone had learnt a lesson, indeed they only have one site as yet. And the reason for building them had changed. Not to close intolerably inefficient and unsuitable old prisons – what an idea! But to accommodate Johnson’s plan to lock prisoners up for longer. Although no estimate of how many places would be needed has ever been produced. The latest announcement is still with the 10,000 figure: but the rationale has largely disappeared. It’s not to relieve overcrowding (surely no-one would build prisons just for that remnant of liberal hand-wringing! Overcrowding is nothing to worry about, bar the occasional lethal pandemic, of course), not to close old prisons, not to accommodate Johnson’s extravaganza – which is no longer so much as mentioned. (Why not, I wonder? Cummings was so proud of it only last year. Caution stirring in HMT at last?) The ‘reasons’ now advanced are…well, absurd. First, to reduce reconvictions. The idea is that shiny new prisons with shiny new gizmos in them (politicians, like children, are irresistibly attracted to shiny new gizmos that whirr and buzz) will be ever so much better at preventing reoffending. (Not, however, so much better than we can ever stop building new prisons – oh, dear no). The evidence for this is, well, nil. In fact, we know perfectly well that this rationale is nonsense:
And it can’t boost local economies quite so much as they boast. Because as Treasury claim, a tad unfortunately, in the same press release, the prisons will in fact be prefabricated and transported to the site to be assembled (“Components, such as concrete walls, and pipework for water and electricity are built by companies around the country using modern, standardised processes and assembled on site.”). So, not locally. (Treasury, in that blissful state of near total ignorance of what Government’ have done previously which characterises Government today, clearly do not know that the first PFI prisons did that a quarter of a century ago. Prefabrication off-site is as exciting an innovation as cardboard.) The wilful ignorance, serial incompetence and cynicism of the MoJ is unforgivable. Particularly since this programme, like everything else done by Government nowadays, will be paid for by forced borrowing from future generations. Johnson plans to lock up more of the younger generation and for longer, then force them and their children to pay for it. Government Debt, which the Tories made such a fuss about when it was only 80% of GDP, and used to justify destructive cuts in prisons, the police, legal aid, has in recent months reached 100%, a level last seen in the early ‘60s when we were still paying off war debt. And as Johnson builds, and the economy slumps, and millions are unemployed the debt will rise much higher. War debt was finally extinguished only by the rapidly rising growth rates of the late 50s and 60s. Does anyone seriously expect to see such growth again – post COVID, post Brexit, post global warming? This debt may even outlast the prisons we are now building. This plan disgraces everyone involved. Note From latest Inspection report on Berwyn, HMPS' flagship brand new state of the art rehabilitative prison, opened just 3 years ago "One of the greatest challenges...was the lack of activity places. It is difficult to understand why and how the procurement of work and training places for a new prison could be so delayed...some [places] were of inadequate quality...Even those that were available were not fully used. Many prisoners were unemployed...staff did too little to support a sound work ethic. The prison was struggling to develop its approach to offender management and resettlement.....There had been no assessment of current need.....Too few offending behaviour programmes to meet need." Etc., etc. Woken at 5 a.m. by a blackbird just outside our bedroom, singing its head off. Our most beautiful songster, I think. Rather that than the show-off nightingale. After 20 minutes or so, pigeons started a throaty ostinato, then distant crows cawing, then at about 5.45 the electric twittering of our sparrow hedge. And I felt such deep longing to be in harmony with the natural world, that I felt like crying.
We shall miss these days, when COVID is over. That sounds strange, but it’s true. Yes, suffering surrounds us like a sea, stretching limitlessly in every direction, stretching to every country and far, far into the future, as the tide of damage, economic, mental, spiritual, political, diplomatic, rolls on and on. And yes, it is terrible. But sometimes, it feels like we are also being shown something, something we always longed for, but thought could never be, shown it actually can exist. That for a moment, it does exist. That if we just restrain ourselves, the natural world we have been so relentlessly despoiling will come roaring back, and it will be immensely healing. That the air can be fit to breath, the sky truly blue instead of a film of muck, the quiet overwhelming, bringing us back to our true selves. And that we can just peel off all the labels that help divide us, Chinese, Italian, English – or Brexiter or Tory or white or male or middle class or all the others – and realise with a sudden rush of recognition that, faced with this awful challenge, we are all one. Not that we should be, but that we already are. And that as one, we could be unstoppable, there would be nothing we could not do. But it cannot last. Already the traffic here is about half way back to normal. Already I can taste the diesel fumes in my throat, my senses heightened by breathing clean air for the first time since …when? Already work has restarted on the development near us. Already the stupidity, division, of politics, the pointless, insulting tribalism and point scoring, is starting up again. Soon we will all go back to exactly the same ideas and standpoints and feuds we had before. Soon the second home owners will rush off to their places in the country or in France, we will start booking fights and hotels, buy another machine, and another…. We will miss the opportunity to change the way we think, act, organise, produce, consume, live. And when we go back to traffic jams all day long, and breathing air acrid with fumes, and peering at skies crowded with vapour trails and Heathrow Hell and busyness and rush everywhere and everywhere Nature and peace being trashed and trampled on, we will miss these days like a dream of something better, something we truly do not deserve. For it is a dream that belongs to some other species than Man. We are too busy, too greedy, too lacking in wisdom, restraint, kindness. We shall miss these days. And we shall never see them again. |
I was formerly Finance Director of the Prison Service and then Director of the National Offender Management Service responsible for competition. I also worked in the NHS and an IT company. I later worked for two outsourcing companies.
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