It was the eve of the 2012 London Olympic Games. An expectant nation nervously awaited the commencement of the global sporting extravaganza, seven years in the making. Would London be capable of using the once-in-a-lifetime opportunity to showcase GB Plc to the world as a modern ‘can do nation'? Or would national frailties be exposed on the biggest global stage?
At this exact point, in early July 2012, those cynical of the whole £13.5bn investment in the ‘jamboree of jumping' themselves jumped on the admission that contractor G4S would not be able to provide sufficient security staff.
With a media outcry of an outsourced ‘security shambles', the Government was forced to call up 3,500 members of the armed services - denying some soldiers, sailors and airmen leave - in order to plug a gap which the £254m contract won by G4S was meant to have filled.
This, and the subsequent flame-grilling of G4S boss Nick Buckles at the hands of Keith Vaz before the Home Affairs Select Committee is as high profile as public sector supplier problems get. But there have been other examples, which if not necessarily as dramatic, have sparked equally loud howls of outrage from spending watchdogs, the media and public alike.
Most recently, the recent fraud allegations and criminal investigation surrounding the Ministry of Justice's prisoner tagging contracts with G4S and Serco served as a reminder that it's still a case of buyer beware for government, even after the most tortuous of procurements.
But large-scale public sector outsourcing, which first made its impact felt three decades ago, is here to stay.
It brings in expertise, delivers economies of scale, provides operational flexibility to do commercial things denied to the public sector.
Under today's favoured commissioner-led model, the clear differentiation between the commissioner and the provider is designed to generate innovation and new ways of providing services.
David Cameron was unable to deliver the wholescale reform he once promised over who should be presumed able to deliver public services - an aspiration lost in the marshes of the Open Public Services white paper. Nevertheless, the Coalition, like the previous Labour government, sees outsourcing as a way to reform public services and get better value for money.
In his speech at the Lord Mayor's Banquet last week, the prime minister spoke of building a ‘leaner more efficient state'.
‘We need to do more with less. Not just now, but permanently,' he said.
To help achieve this goal, the Government believes its top suppliers have more to contribute to the overall austerity programme by delivering greater value.
For this to happen, there needs to exist a genuinely competitive market, that provides incentives for delivery of better services and sound accountability regimes to underpin them.
Set against this context, the National Audit Office (NAO) was summoned to investigate the massive £187bn market for goods and services across the UK public sector. The auditors estimate the outsourcing of both back office functions -like IT services and facilities management - and frontline services, anything from running prisons to maintaining nuclear weapons, accounts for half this spend.
Singled out because they could help explain cross-cutting issues and for being the best known commercial providers of public services, Atos, Capita, G4S and Serco were an admittedly obvious choice for the NAO. They were also in the crosshairs of Margaret Hodge, who chairs the influential Public. Accounts Committee.
Serco generated the most public sector revenue in the UK in 2012, totalling £1.8bn – including £382m of local government deals. Next in line came Capita with £1.1bn worth of government deals, followed by G4S with £718m and Atos with £683m of government business.
