Justice is supposed to be blind, but not when signing outsourcing contracts. House of Commons committees expose Ministry of Justice outsourcing contract calamities.

In a previous post we complained about the coalition government's plan to reduce spending on public services to the lowest level since before 1948. 

The Ministry of Justice (MoJ) provides a good (i.e. dreadful) example of this blind rush to cut costs. 

Rather like someone looking for a miracle diet, the MoJ showed it was prepared to swallow anything to lose costs. Sadly this is the same with all the ministries chasing the government's strategy of cutting costs. They measure success by the number of pills they take, and not by the effectiveness of the resulting 'body shaping'. They rush because they know the pill-box may be taken away from them at the next election (though Labour say they will pop the same pills, so it is doubtful us ripped-off Britons will be any less ripped-off).

Outsourcers tempted by this careless slopping out of public sector contracts claim they improve services and lower costs by deploying their ninja-like private sector skills. In practice, their bright ideas are focussed on extracting profits.


Probably the key innovation the private sector brings is cutting staff pay and benefits. Cutting the pay of public sector staff is a very blunt instrument that could be done without outsourcing to the private sector. However governments dare not do this directly because the public sector workforce is better organised by unions to resist. Privatised employees are broken off from this mutual support and become easier prey. A report by IDS, who do independent research on employment issues, shows that the private sector pays worse in general, and exceptionally worse when it comes to female employees:





A stark example of this unthinking wage-cutting was exposed by the House of Commons’ Justice Committee inquiring into the Ministry of Justice's (MoJ) calamitous outsourcing: the provision of foreign language interpreters. Interpreters are required in courts and tribunals to help ensure non-English speaking defendants receive justice. Ironically interpreters are mainly freelance contractors - they are already 'private sector'. The MoJ seemed to simply want someone else to take on the task of cutting the interpreters' pay.
 
The startling incompetence with which the MoJ chose the outsourcer, Applied Language Solutions (ALS), had already been described in a report by the National Audit Office (NAO) in September 2012. The NAO observations suggest the MoJ seemed to take the “justice is blind” thing too literally. The NAO commentary reveals:

a)      The MoJ ignored a report it itself had commissioned, that advised ALS was too small to take on such a big project. The report recommended giving ALS contracts worth no more than £1million a year, a small fraction of the actual £200 million plus value of the outsourcing deal over five years. The MoJ was too dazzled by ALS' cost cutting promises.

b)      The MoJ was blindly impressed that a respected expert had given his views on ALS’ proposal, but had failed to find out what those views were. The NAO report states:

“The Ministry was partly influenced in this decision by the knowledge that ALS itself had sought the views of a specialist in Public Service Interpreting from Middlesex University, Mr Brooke Townsley. However, the Ministry did not ask to see Mr Townsley’s views in full and ALS did not tell the Ministry about what Mr Townsley described to us as his profound reservations about the validity of the proposed tiering system and about applying in-work assessments for interpreters who had recently completed their Diplomas in Public Service Interpreting.”

Still smarting from this spanking administered by the National Audit Office, the MoJ was understandably worried about an investigation by Parliament. So worried that the Ministry of Justice apparently instructed its staff not to cooperate with this parliamentary inquiry. The ensuing report complained about this non-cooperation:

“Our efforts to obtain a full picture of the current effectiveness of interpreting services were hampered by the absence of any substantiation from frontline staff. In the course of our inquiry it became apparent that HMCTS [Her Majesty’s Courts & Tribunal Service] had issued an edict to its staff instructing them not to participate in our online consultation, established to invite direct observations of ALS performance, an approach which we had found productive in previous inquiries. We consider that the actions of the Ministry in this case were unhelpful and contrasted with the approach they took in our previous inquiries. We consider that their actions may have constituted a contempt of the House, but as we have sufficient evidence from other sources to make a reliable judgement, we have not asked the House to take further action on this matter, although we gave serious consideration to doing so.”

Having signed the MoJ contract in October 2011 the boss of ALS sold his business to Capita in December 2011. You may make of that hurried disposal what you will. Anyway, Mr Andy Parker, Joint Chief Operating Officer of Capita Plc, appearing in front of the Justice Committee described how the business worked in practice:

“We provide a booking portal. We give a service where we have a central complaints service. We ensure all the vetting is done. We ensure all the interpreters are correctly tiered and correctly qualified. We liaise with the court and then we provide a booking service for the courts on our IT. The courts make the request, either by telephone to our call centre or directly on to the portal, and then the interpreters have the ability to take those jobs without intervention by looking at our portal. If a job isn’t fulfilled by the portal, we would phone up a variety of interpreters based on their relevant skill sets. But on the basis that they don’t actually work for us we’re not really controlling who does what; we’re just making the job available.”

The Capita boss was uncharacteristically candid, admitting that Capita didn’t control the work, they just make it available. Their key ‘innovation’ was to slash the pay of the interpreters, and to accept inadequately qualified ‘interpreters’ who would, in one example, quite literally work for carrots. As the report observed:

“ it is evident that some professional interpreters had registered with ALS despite having no intention of accepting work, and others had deliberately registered spoof identities, including a pet rabbit; this exposed the fact that ALS were automatically inviting all those who had registered on the supplier database to accept work, despite the company not having sought verification of their identities or credentials."

The report commented:

"The MoJ was, at best, naïve to view the new arrangements simply as an “outsourced booking process”. Interpreters had repeatedly raised significant concerns about the new terms and conditions under which they were expected to work"

The way some interpreters were being procured was stated in written evidence to the committee:

“Fortunately for ALS there are many immigrants in this country who are unemployed or in low paid jobs and speak reasonable conversational English. Though most of these do not comply with the educational and language training standards required for a Tier 2 interpreter, ALS has largely ignored these quality requirements and the MoJ has, so far, not asked the relevant questions. “

That the MoJ had already closed its mind to asking 'relevant questions' is shown by the then minister, Crispin Blunt, who said in Parliament on 12th March 2012

“Some of the problems, strangely enough, came from the interpreters who, on finding that under the new payment regime they could no longer earn six-figure salaries, as they could under the previous Administration, did not co-operate.”

 
Perhaps Blunt had confused interpreters with MPs topping up their incomes to six figures with expenses, employing spouses, and 'consultancy fees'. In written evidence to the Justice Committee inquiry Kasia Beresford, a professional interpreter, contradicted Blunt, stating:

“In my experience the real remuneration an interpreter working full time in an in-demand language and available 24 x 7 could earn was at the £15,000–£30,000 p.a. level. That is not attractive remuneration for graduates with additional specialist qualifications, taking on all the risks of self-employment and working unsociable hours. It is certainly not excessive."

Kasia Beresford’s written evidence (well worth reading) goes on to show the effective hourly rate net of travel expenses offered by Capita to professional interpreters was as low as £4.44 an hour. Less than the minimum wage.

The report states that the Ministry of Justice is achieving savings, but this is being done by Capita simply picking up the additional costs. While Capita losing money may seem like a rare case of justice at the MoJ, the report states:

"We are concerned that the existing arrangements are financially unsustainable in the sense that Capita TI is propping up the continuation of the Agreement, so the Department’s savings are effectively being secured at the company’s expense. There is a distinct risk that the MoJ will not be able to continue to realise the same level of cost savings in the future and that when the time comes to re-tender the contract there may be an insufficient supply of professional interpreters to furnish it. The MoJ would then be left with fewer savings and an enduringly poorer quality of service."

It is questionable whether the MoJ would worry about 'an enduringly poorer quality of service', as their priority is to cut costs. And from Capita's point of view even though it was left with a short term loss on supplying interpreters, with public sector revenues of £1.1billion in 2012-13 Capita can be confident of overall healthy profits.

Outsourcing, from schools to prisons to hospitals to justice, has been an effort by successive governments to cut costs and stuff public money into private sector profits regardless of the impact on public services.