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Prison system: Government rejects settlement from G4S over false billing

The Government has rejected a £24.1m settlement from contractor G4S, after the company admitted it had overcharged the Government for home tagging services for offenders, reports the BBC.

G4S made the admission that it had overcharged the Ministry of Justice after an audit suggested they had been billing for prisoners who were either dead or still in prison.

The company performed an internal review, which found that the system for billing the Ministry of Justice was not appropriate, but which also ruled out any wrongdoing or criminal intent in the over-charging.

G4S offered the Government £24.1m in settlement for the overcharged bills, but it is understood that ministers have rejected the settlement figure, as they are unclear on exactly how much they have been overcharged.

This is the second incident of overcharging for security tagging of prisoners under contract.

In July this year another contractor, Serco, admitted that it had overcharged the Government by tens-of-millions of pounds on contracts for electronic tagging of offenders.

The revelations concerning both companies have led to an investigation into their billing practices by the Serious Fraud Office, and led Keith Vaz, the chair of the Home Affairs Select Committee, to call on the Government to ban G4S companies from bidding for government contracts in future.

"The company (G4S) refused to co-operate with the Government, which led to the referral to the SFO, and that should have rung alarm bells. It represents serious corporate failure," he said.

The Government said it could not comment on an ongoing criminal investigation, but said that it was determined to secure the taxpayer a full refund for any wrongful charges in due course.