UK delays award of prison privatisation contract -FT

Mon May 20, 2013 2:57pm EDT

May 20 (Reuters) - The privatisation of five UK prisons has been delayed by the Ministry of Justice following an investigation into whether it was overcharged on two contracts with private-sector companies, the Financial Times reported.

The winning bidders for the privatisation of HMP Northumberland and South Yorkshire, which together total five prisons, had expected to be told this week, the paper said.

The decision has been delayed partly because the personnel involved with the procurement process are now busy on the probe, the Financial Times said on its website.

"We haven't set a date as to when we were going to be announcing it," a Justice Ministry spokeswoman said, adding that the successful bidders would be announced in due course.

French caterer Sodexo, Serco and a venture between U.S. prisons firm MTC and Britain's Amey - owned by Spanish group Ferrovial - are in the running for the prison contracts.

Last Friday, the Ministry of Justice said auditors from professional services firm PwC would examine two contracts signed in 2005 with Serco and G4S, which together cost the department 107 million pounds ($163 million) in 2012/13 for electronic tagging and monitoring of offenders released from prison.

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