UK Government says Serco overhaul on right track

LONDON Thu Jan 30, 2014 5:07am EST

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LONDON Jan 30 (Reuters) - The corporate overhaul being made by British outsourcing group Serco in light of some high profile contract failures are on the right path to meeting the government expectations as a customer, Britain said on Thursday.

Last month Serco agreed to refund 68.5 million pounds ($113.38 million) to Britain's Justice Ministry after an audit showed they, and rival G4S, charged for putting electronic tags on criminals who were not being monitored, in prison or dead. Serco has also faced fraud allegations on a prisoner escorting contract.

Serco, which makes around 25 percent of revenue from the UK government, has seen its UK and group chief executives exit since the scandal erupted, and has committed to strengthening its board and restructuring part of its UK business.

"The government has accepted this (corporate renewal) plan represents the right direction of travel to meet our expectations as a customer," the government said in a statement, adding the renewal was an ongoing process which would continue to be monitored.