First major deal completed by government since collapse of Carillion condemned by unions
'Capita has been awarded a new contract from the Ministry of Defence to run UK military fire and rescue services despite a financial health assessment that attached the highest possible risk rating to the outsourcing company.
The awarding of the contract was condemned by unions. It is the first major deal completed by the government since the collapse of the rival firm Carillion in January, which put the outsourcing of the public sector under the spotlight.
Capita scored 10 out of 10 for risk in a document prepared for the MoD. One indicates the lowest probability of distress and 10 the highest.
The risk assessment document was updated on 7 June, according to the Financial Times. On Tuesday Capita confirmed it had been selected for the contract, which is estimated to be worth about £500m over 10 years and involves the running of about 70 military fire stations worldwide.
Shares in the company, which also announced it had sold its supply chain business Supplier Assessment Services, raising £160m, according to analysts, closed up nearly 8% at 164p, before the FT first reported the 10/10 risk assessment score.
As part of the risk assessment Capita was also awarded a “health score” of just three out of 100. A score of 25 or less is deemed to be in a red “warning area” of heightened vulnerability.'
Read more: Capita awarded £500 million MoD contract despite 'highest risk rating'