The operation of Brook House

12. The total lifetime value of the contract was £137.5 million over 11 years.¹ It was recorded in a G4S spreadsheet that G4S had mad cumulative efficiency and clustering savings of £4.05 million from July 2012 to May 2017.² Mr Peter Neden, G4S Regional President UK and Ireland during the relevant period, said that this did not represent cost savings being prioritised over the welfare of detained people.³ Payment was by way of a monthly fee, which rose with inflation. During the relevant period (1 April 2017 to 31 August 2017), the monthly fee paid by the Home Office to G4S was approximately £1 million, from which G4S paid all staff, running costs and subcontractors.⁴
13. Ms Stacie Dean, formerly Head of Tinsley House IRC, asserted in a grievance letter and in a meeting in January 2017 that there had been some deliberate under-reporting of incidents to the Home Office, as well as an alleged mistake about the profit margin that led to a need to make savings.⁵ During a subsequent grievance meeting with Ms Dean in January 2017, Mr Jeremy Petherick, Managing Director of G4S Custodial and Detention Services during the relevant period, commented:

“There is nothing to stop us making money, providing we deliver the contract.”⁶

14. The National Audit Office, which undertook a review in 2019 of the Home Office’s management of the Brook House contract at the request of the Home Affairs Select Committee, noted the following, based on information from G4S:

“G4S’s annual gross profits ranged between £2.1 million and£2.4 million, representing between 18% to 20% gross profit (Figure 11). G4S spent more on the contract following the Panorama episode in September 2017, and its gross profit fell to £1.3 million (10%) in 2017 and £1.8 million (14%) in 2018 … It is difficult to say exactly what an appropriate profit would be … It is not obvious that G4S carries a particularly high level of financial risk on this contract given the low level of financial penalties available, but its profit did fall following Panorama as it spent more on the contract.”⁷

15. The monthly fee that the Home Office paid to G4S was subject to performance-related deductions. Schedule G of the contract set out 30 performance measures (key performance indicators or KPIs), examples of which are set out in Table 3, some of which gave rise to a set financial penalty if not met, and some of which incurred points that had a value that varied over time.⁸

Table 3: Extract of performance measures under the GSL contract

16. G4S was required to monitor compliance with these measures and report any failures to the Home Office. Fee deductions could be imposed each month, depending on the seriousness of any failures. If grounds of mitigation could be proposed for the failure and were accepted by the Home Office, no penalty was imposed. Only failures in relation to matters listed in Schedule G could attract deductions. For example, while staff training content was set out in a plan approved by the Home Office, no penalties would attach to a failure to follow the plan.⁹ Neither did specific penalties attach to improper use of force.¹⁰ Deductions represented around 1.5 per cent of the monthly fee on average over the life of the contract.¹¹ During the relevant period, G4S incurred 19,245 penalty points, amounting to a financial deduction of £32,154.38.¹²
17. Mr Riley considered that, by 2017, the contract was not suitable for what Brook House was being asked to deliver, one issue being that it did not appropriately mandate the deployment of staff within Brook House.¹³
18. Mr Petherick told the Inquiry that the Home Office set the level of penalty points. While he suggested that he personally believed that the penalty attached to, for example, an escape, versus the death of a detained person, showed misplaced priorities, Mr Petherick said that the various levels of sanction “didn’t come into the conversation” with the Home Office once G4S took over the contract.¹⁴
19. The penalty structure of the contract set by the Home Office emphasised security over care. An escape was penalised at three times that of a death in detention from self-harm involving a failure in procedures.¹⁵ This is indicative of a lack of sufficient prioritisation of the wellbeing of detained people.

1. DL000175_013 para 1.9[↩]
2. INQ000119_032 para 157[↩]
3. Peter Neden 22 March 2022 51/17-52/14[↩]
4. DL000175_016 paras 1.12-1.13[↩]
5. CJS0073632_003-005[↩]
6. CJS0073632_003-005 [↩]
7. DL000175_007 para 15; DL000175_024-025 paras 2.16-2.21[↩]
8. HOM000921; from April to May 2017, each point incurred a penalty of £1.54. In June 2017, this figure increased to £1.73 (CJS004578[↩]
9. HOM000921; DL0000175_007 para 14[↩]
10. HOM000921; DL0000175_007[↩]
11. DL0000175_018 para 2.3[↩]
12. CJS004578[↩]
13. Philip Riley 4 April 2022 44/17-19, 51/8-22[↩]
14. Jeremy Petherick 21 March 2022 124/21-125/1[↩]
15. HOM000921[↩]