Serco's troubles spread to the US

The company is facing questioning over an Obamacare contract thanks to its problems in the UK.

The Government review into Serco and G4S is making waves in the US, where the former company has just been awarded a $1.2bn contract to manage key elements of Obamacare. The Washington Post's Sarah Kliff writes:

That contract, announced in late June, is among the largest Affordable Care Act grants made so far, expected to cover the hiring of 1,500 workers who will process a wave of health coverage applications…

Serco’s $1.2 billion contract with the Center for Medicare and Medicaid Services is the firm’s first health law award, Hill said. The company does, however, have experience handling large U.S. government jobs through contracts with the State Department to process visa applications and with the U.S. Patent and Trademark Office, where it oversees patent requests.

I was surprised to hear that Serco was involved in Obamacare, since the British branch was – I thought – mainly involved in areas like transport and security. But no. Their Wikipedia page lists interests in home affairs, transport, science, detention, defence, aviation, health, education, drivers' licensing, leisure, web development, it infrastructure, and waste collection.

How can one company be so good at all of these varied functions to continually win contracts? It's a broad mix, but it's not one that's completely unheard of elsewhere. General Electric is probably the most famous example in the private sector, a corporate titan which spans jet turbines to finance, through healthcare, consumer electronics and energy. As Ben Thompson writes, "the competitive advantage of such companies is usually in their management acumen and capital reserves, and the preferred employee is a generalist, able to quickly master any job with a refined set of skills."

But that doesn't fully explain companies like Serco. If it's just equivalent to General Electic, and its advantage comes from management and capital, then why doesn't GE take more government contracts, and why doesn't Serco work outside the outsourcing sector more?

In case it's not clear – and if you've read Alan White's series on the shadow state, it should be – what companies like Serco do very well is deal with Governments. That's their comparative advantage, and it's a big one. There may be very little in common between the procedures for designing a website and a running a train service – but there's a lot in common between the procedures for obtaining the contracts. Once you know how to bid for a contract, which performance targets matter, and who to take out for dinner, the difficult part is done.

That's not to say that outsourcing companies are doomed to be bad at their job. For every major scandal, there's a contract which is quietly ticking along successfully. But it exposes the contradiction at the heart of the process: if it's more important for their success that outsourcing companies be good at winning contracts than it is that they be good at fulfilling the contracts, then the justification for offering the goods up in the first place gets confused.

And so Serco moves into Obamacare, and the march of the outsourcers continues.

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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The Tories play Game of Thrones while the White Walkers from Brussels advance

The whole premise of the show is a pretty good metaphor for the current state of British politics.

If you’re a fan of asking “who’s that, then?” and “is that the one who killed the other one’s brother?”, I bring great news. Game of Thrones is back for a seventh series. Its vast assortment of characters was hard enough to keep track of before half of them got makeovers. But now the new Queen Cersei has reacted to the arrival of the long winter by investing heavily in the kind of leather ball gowns sold by goth shops in Camden, and Euron Greyjoy, once a fairly bland sailor, has come back as a Halloween costume version of Pacey from Dawson’s Creek, all eyeliner and epaulettes.

The show’s reliance on British character actors is the only thing keeping me vaguely on top of the cast list: what’s Diana Rigg up to these days in Highgarden? And what about that guy who was in Downton Abbey that time, who now has the scaly arms? (Luckily, the next thing I watched after the Game of Thrones series premiere was the first two episodes of the revived Twin Peaks, which put my confusion into perspective. There, Agent Cooper spent most of his time talking to a pulsating bladder attached to one of those fake trees you get from Ikea when your landlord won’t let you have real plants.)

The day-to-day business of Game of Thrones has always been power – answering the question of who will sit on the Iron Throne, forged by Aegon the Conqueror from the swords of his defeated enemies. But its backdrop is a far bigger threat: the arrival of a winter that will last many years, and the invasion of an army of the undead.

That might seem like an unkind way to think about Michel Barnier and his fellow Brexit negotiators – inexorably marching towards us, briefing papers in hand, while Liam Fox frantically rings a bell at the entrance to the Channel Tunnel – but nonetheless, the whole premise of Game of Thrones is a pretty good metaphor for the current state of British politics.

The current internal Conservative struggle for power might be vicious but it is at least familiar to its contestants; they know which weapons to deploy, which alliances are vital, who owes them a favour. Meanwhile, the true challenge facing every one of them is too frightening to contemplate.

In 2013, this magazine celebrated the early success of the show with a cover depicting one of our terrifying painted mash-ups: “The Tory Game of Thrones.” Our casting has been strangely vindicated. George Osborne was our Jaime Lannister – once the kind of uncomplicated bastard who would push a child out of a window but now largely the purveyor of waspish remarks about other, worse characters. Our Cersei was Theresa May, who spent the early seasons of The Cameron Era in a highly visible but underwritten role. Now, she has just seized power, only to discover herself beset by enemies on all sides. (Plus, Jeremy Corbyn as the High Sparrow would quite like her to walk penitently through the streets while onlookers cry “shame!”)

Michael Gove was our Tyrion Lannister, the kind of man who would shoot his own father while the guy was on the loo (or run a rival’s leadership campaign only to detonate it at the last minute). Jeremy Hunt was Jon Snow, slain by the brotherhood of the Night Shift at A&E, only in this case still waiting for resurrection.

The comparison falls down a bit at Boris Johnson as Daenerys Targaryen, as the former London mayor has not, to my knowledge, ever married a horse lord or hired an army of eunuchs, but it feels like the kind of thing he might do.

We didn’t have David Davis on there – hated by the old king, David Camareon, he was at the time banished to the back benches. Let’s retrospectively appoint him Euron Greyjoy, making a suspiciously seductive offer to Queen Cersei. (Philip Hammond is Gendry, in that most of the country can’t remember who he is but feel he might turn out to be important later.)

That lengthy list shows how Conservative infighting suffers from the same problem that the Game of Thrones screenwriters wrestle with: there are so many characters, and moving the pieces round the board takes up so much time and energy, that we’re in danger of forgetting why it matters who wins. In the books, there is more space to expound on the politics. George R R Martin once said that he came away from The Lord of The Rings asking: “What was Aragorn’s tax policy?” (The author added: “And what about all these orcs? By the end of the war, Sauron is gone but all of the orcs aren’t gone – they’re in the mountains. Did Aragorn pursue a policy of systematic genocide and kill them? Even the little baby orcs, in their little orc cradles?”)

Martin’s fantasy vision also feels relevant to the Tories because its power struggles aren’t about an “endless series of dark lords and their evil minions who are all very ugly and wear black clothes”. Instead, everyone is flawed. In Westeros, as in the Conservative Party, it can be difficult to decide who you want to triumph. Sure, Daenerys might seem enlightened, but she watched her brother have molten gold poured down his throat; plucky Arya Stark might tip over from adorable assassin into full-blown psychopath. Similarly, it’s hard to get worked up about the accusation that Philip Hammond said that driving a train was so easy “even a woman” could do it, when David Davis marked his last leadership campaign by posing alongside women in tight T-shirts reading “It’s DD for me”.

The only big difference from the show is that in real life I have sympathy for Barnier and the White Walkers of Brussels. Still, maybe it will turn out that the undead of Game of Thrones are tired of the Seven Kingdoms throwing their weight around and are only marching south to demand money before negotiating a trade deal? That’s the kind of plot twist we’re all waiting for.

Helen Lewis is deputy editor of the New Statesman. She has presented BBC Radio 4’s Week in Westminster and is a regular panellist on BBC1’s Sunday Politics.

This article first appeared in the 20 July 2017 issue of the New Statesman, The new world disorder