The Ministry of Justice (the Ministry) has so far failed to achieve value for money with its management of the new generation electronic monitoring programme, which is estimated to cost £130 million by 2024-25, according to the latest report from the National Audit Office. The service itself is expected to cost £470 million between 2017-18 and 2024-25. The Ministry pursued an overly ambitious strategy which was not grounded in evidence, and failed to deliver against its vision. It has learned from its previous failings, and has begun to make necessary improvements. But major risks remain.
The electronic monitoring of offenders has an important role in supporting rehabilitation in the community and as an alternative to prison. In 2011, the Ministry launched a programme to develop a new ‘world-leading’ ankle tag that combined radio frequency and GPS technology. It set out to procure the service using a new ‘tower’ delivery model, which incorporated contracts with four separate suppliers who would provide four different elements of the service, with their work pulled together by a contracted integrator.
The NAO’s report finds that the Ministry did not do enough to establish the case for a major expansion of location monitoring using GPS, and that the Ministry’s bespoke requirements for new world-leading tags proved too ambitious.
Furthermore, the planned timescale for the programme was unachievable. The Ministry initially allowed 15 months after signing the contract for the tags in August 2012 to develop, test, manufacture and deploy the new tags. Contracts, however, were not signed until July 2014 due to the discovery of overbilling by G4S and Serco, followed by two failed procurements for the tags. The Ministry has now appointed G4S as preferred bidder for the tags. It expects the new tags to be deployed from the end of 2018, completing roll-out six months later. This represents a total delay to the programme of five years.
Five years after initiation, the programme has not delivered the intended benefits. The Ministry had expected the programme to reduce annual monitoring costs by at least 9% (£9 million) and potentially up to 30% (£30 million). The Ministry has so far spent around £60 million and remains reliant on the legacy services. However it has reported savings of 10.6% by negotiating with Capita, the new monitoring supplier, which has streamlined the existing operation over time.
The NAO finds that the Ministry adopted a new high-risk and unfamiliar approach to the procurement, and failed to manage the implications. Furthermore, the Ministry also failed to anticipate and resolve the implications of its delivery model, which led to disputes with Capita and other suppliers.
The Ministry’s governance arrangements were weak, causing slow decision making and allowing internal disagreements to persist. External reviews noted a lack of accountability to Senior Responsible Owners and unhelpful disunity between operational, technical, commercial and programme staff. This was compounded by a lack of capacity and capability in the context of high competing demand from other projects.
Following internal and external reviews of the programme in 2015 and 2016, the Ministry has taken action to address many of the issues. This includes changing approach to buying available off-the-shelf tags and bringing the integration function back in house. Leadership is now more stable and cohesive. In March 2017 the Infrastructure and Projects Authority assessed that the programme team had been reinvigorated following key staffing changes and that delivery confidence had improved. However significant risk remains. Achieving an effective new monitoring service without relying on a contracted integrator will require the Ministry to be much more closely involved than before in integrating the end-to-end service. It will have to build and sustain its technical and programme management capabilities to effectively perform this expanded role.
“The case for a huge expansion of electronic monitoring using GPS was unproven, but the Ministry of Justice pursued an overly ambitious and high risk strategy anyway. Ultimately it has not delivered. After abandoning its original plans, the Ministry’s new service will now, ironically, be much closer to its existing one. Even if it launches in 2018, it will still be five years late. The Ministry has learnt costly lessons from its failings but significant risks still remain.”Amyas Morse, head of the National Audit Office
Read the full report
Notes for editors5 years Total delay to deployment of new electronic monitoring tags (originally planned from November 2013 and now expected to start at the end of 2018) £130 million Lifetime estimated cost of the programme to obtain the new electronic monitoring service by 2024-25, including £60m sunk costs incurred to 31 March 2017 160,000-220,000 Number of subjects originally expected to be tagged in 2016-17 The actual number is expected to be less than 65,000 in 2016-17 £470 million Expected costs of running the monitoring service, including service payments and contract management, from 2017-18 to 2024-25 2 Number of failed procurements for the development of new tags £4.4 million Net settlement paid by the Ministry to the former tag supplier, Steatite 9% (£9 million) to 30% (£30 million) Savings expected by the Ministry in annual monitoring costs through a new service 10.6% Savings claimed by the Ministry through renegotiating the price of its existing monitoring contract with Capita 5 Number of senior responsible owners for the programme since it began in 2011
- Since 1999 the UK government has used contracted-out electronic monitoring, or ‘tagging’, services for the sentencing and supervision of offenders. Electronic monitoring allows the police, courts or probation services to monitor offenders' locations and compliance with home curfews.
- In 2011 the Ministry of Justice, identified an opportunity to enhance this electronic monitoring service. It launched a programme to develop a new world-leading ankle tag, combining both Radio Frequency and GPS functionality to be used on all tagged offenders. The Ministry also sought to procure the service under a new ‘tower’ delivery model.
- Press notices and reports are available from the date of publication on the NAO website. Hard copies can be obtained by using the relevant links on our website.
- The National Audit Office scrutinises public spending for Parliament and is independent of government. The Comptroller and Auditor General (C&AG), Sir Amyas Morse KCB, is an Officer of the House of Commons and leads the NAO, which employs some 785 people. The C&AG certifies the accounts of all government departments and many other public sector bodies. He has statutory authority to examine and report to Parliament on whether departments and the bodies they fund have used their resources efficiently, effectively, and with economy. Our studies evaluate the value for money of public spending, nationally and locally. Our recommendations and reports on good practice help government improve public services. Our work led to audited savings of £734 million in 2016.