Locog stops G4S payments over Olympics security fiasco

Paul Deighton, chief executive of the organising committee Locog, told MPs that it stopped payments to the world’s largest security company on July 13, two days after G4S said it would not be able to deliver the 10,400 security guards it had agreed to deploy, reports The Telegraph.

Mr Deighton, who will join the Treasury as a minister in January, said Locog had so far paid G4S £90m of a total £240m agreed, and the rest is subject to negotiation.

During an appearance at a Home Affairs Select Committee hearing, he was clear that blame for the Olympics security failure lay entirely at the door of G4S.

“We had absolutely clear and consistent reassurances from the senior management that they’d be able to deliver … up until that fateful day on July 11. We shouldn’t over-complicate this. They just failed to deliver because their own processes broke down.”

According to Locog, on their best day during the Olympics, G4S fell short of its contractual obligations by 4pc, and on its worst day by 35pc. It fully delivered on its requirements for the Paralympics.

In a thinly veiled criticism of G4S, Mr Deighton noted that Locog had managed to successfully deploy 70,000 volunteers to work during the Games, about seven times the number of guards the FTSE 100 company had agreed to supply. G4S had been asked to deploy 10,400 guards at peak times during the Olympics, but managed just 7,800.

Appearing in front of the Committee at a later session on Tuesday, G4S chief executive Nick Buckles said the company would be negotiating penalty payments with Locog but said he expected the company to be paid for the work it did.

“I’m not going to sit here and say we did a great job, but we delivered a significant proportion of the contract. I expect them to pay us in line with the terms of the contract.”

Mr Buckles’ future at G4S remains uncertain as the board awaits a report from PricewaterhouseCoopers on what went wrong with the contract. He said that he had invested a big part of his life and career into the company but said he would wait to see the outcome of the report, which is expected by the end of this month.

Mr Buckles added: “I’m group chief executive, and if a contract goes wrong I take the pain of that.”

Speaking after the sessions, chairman of the Committee Keith Vaz said: I think it’s absolutely clear that Locog is right not to be paying them anything … but it’s also clear that [G4S] admitted full responsibility for what’s going on and I would imagine Mr Buckles realises the buck stops with him.”

Shares in G4S fell 2pc – or 5.1 – on Tuesday to 255.6p.