Serco's Stafford quits as government does u-turn on prison contract

22nd Nov 2013 12:41

Scandal-hit services company Serco Group saw its share price rise on Friday after it was announced its head of UK and Europe, Jeremy Stafford, was to quit. The group is attempting to re-build its damaged relationship with the UK government after a recent embarrassing debacle involving electronic tagging.Currently both Serco and G4S are under investigation by the Serious Fraud Office after it was alleged they charged for criminals who were in jail, had died, or had never even existed. Serco on Friday released a statement which read: "For the last four months Serco has been working hard to refresh its relationship with central government in the UK."As a result, Serco and Jeremy Stafford have concluded that a change in the senior leadership of our UK & Europe division would accelerate and consolidate that process."Stafford is the second board member to fall on his sword after Chief Executive Christopher Hyman quit his role last month. Stafford's departure was revealed the same day the Ministry of Justice (MoJ) announced that, "for operational reasons", the South Yorkshire group of prisons will remain under public sector management. Serco had been named as the lead bidder for the contract back in July, but the government has now decided, in light of the investigation, to maintain control of the prisons. "We understand that the urgent need for change at these prisons means that the typical six-month period of mobilisation and transition to the private sector would not be in the best operational interest of the prisons," Serco said. Acting Group Chief Executive Ed Casey added: "From meetings with the UK government it is clear that the operational needs of the prisons will be best served by the necessary changes being implemented without further delay. "We are also continuing to make good progress across the various audits, reviews and our proposed corporate renewal programme within the timing previously communicated by government."NR