10/01/2014 - 10:19

Serco denies price-gouging allegations

10/01/2014 - 10:19

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Government contractor Serco says there is no evidence to support claims it inflated transport costs for prisoners attending funeral services in regional Western Australia by as much as 830 per cent.

Government contractor Serco says there is no evidence to support claims it inflated transport costs for prisoners attending funeral services in regional Western Australia by as much as 830 per cent.

Labor corrective services spokesman Paul Papalia yesterday released figures alleging Serco quoted $31,927 for transport to a funeral in Meekatharra, $30,040 for transport to a funeral in Halls Creek and $29,923 for transport to a funeral in Kununurra in the 2011-12 financial year.

He claims the government's previous custodial services contractor, G4S, had provided an identical service at a fraction of the cost before losing the contract to Serco, which was awarded a five-year, $210 million custodial services and court security deal in 2011.

Mr Papalia's claims follow similar price-gouging allegations aired on 6PR radio earlier this week.

Serco late yesterday issued a statement saying it had investigated the claims and found no evidence to support them.

Serco said it believed the G4S contract was "cost plus for labour only", with all direct costs absorbed by the Department of Corrective Services and claims its charges cannot therefore be directly compared to those quoted by Serco.

The company has also rebutted claims it charged $23,000 to transport a prisoner from Geraldton to a funeral in Canarvon in 2012, stating that the final cost to the department was $10,367, which included the cost of hiring an air charter as commercial flights were not available.

“We had already investigated the previous claims, for which we have seen no supporting evidence and which cannot be substantiated," Serco chief executive Asia-Pacific Mark Irwin said.  

"The claims today have again been made with no supporting evidence and without an explanation of the fundamental differences between the services and contracts they purport to compare.  

“Serco has continuously operated within the contract to deliver services. Rightly, the work that we do is subject to rigorous monitoring and review. We will keep working to offer better services and better value for money, but we want to be judged on the facts.”

Serco has also come under fire over its transport security procedures after two dangerous prisoners escaped from a van at Geraldton Airport as they were being transferred to Hakea Prison on Friday.

Mr Papalia yesterday said Corrective Services Minister Joe Francis was either incompetent or deliberately deceiving taxpayers by claiming to be unaware of the excessive transport quotes.

"Clearly costs for prisoner transport escalated dramatically under Serco," Mr Papalia said.

"Why has the minister deliberately concealed the increase in costs under Serco?

“Only an independent judicial inquiry will reveal all of the circumstances relating to the recent prisoner escape and failures in Serco’s provision of services across the department.”

A spokesman for Mr Francis said the Department of Corrective Services was investigating the claims.

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