THE BUSINESS OF CRIME: There are now twice as many private security guards in the UK as 10 years ago

THE BUSINESS OF CRIME: There are now twice as many private security guards in the UK as 10 years ago - Jails have been privatised, and even police forces are hiring outside help. The jury may be out on the social effects of all this, but there's no doubt

by STEPHEN COOK
Last Updated: 31 Aug 2010

Jails have been privatised, and even police forces are hiring outside help. The jury may be out on the social effects of all this, but there's no doubt that the security industry has captured a lucrative market. Stephen Cook reports.

When Martin Richards got back to his detached house in Hadley Wood late on a winter evening, three masked men were waiting for him in the drive. They grabbed him in an armlock, forced him to open the door, and put him and his family through 10 minutes of terror that they'll never forget. Nine months later, they're still recovering from the trauma.

In our increasingly lawless society, there are hundreds, probably thousands, of us who can relate similar stories of violence. But what happened to the Richards family that night prompted another small but significant development in a pounds 4 billion industry that has grown inexorably over the past decade and is poised for yet more expansion.

Fifteen years ago, 'security' meant little more than a night watchman dozing in an office. But now it means cameras in city streets, uniformed guards in shopping centres and - most controversially - the increasing takeover by private firms of areas once reserved for police and other public agencies. There is now one uniformed private security officer for each of the country's 130,000 police officers, and the incident in Hadley Wood helps explain why.

As Richards was pushed into the house, he shouted a warning to his family.

His wife hid behind a door, but was dragged out, punched, and threatened.

He managed to break free and hit a panic button, which set off the alarm, but was struck on the head and left semi-conscious. The attackers - watched placidly by the family dog - then found his 12-year-old son and threatened to hurt him if he didn't say where the valuables were kept.

Fortunately, his 15-year-old daughter had heard the uproar and phoned the police from an upstairs bedroom, and the screams and the ringing alarm panicked the robbers into leaving empty-handed. The police arrived in five minutes, followed shortly by a helicopter with a searchlight, but by then the gang had made its escape. No-one has ever been arrested for the attack.

'The most shocking thing was our loss of confidence,' says Richards (not his real name). 'You regard your home as somewhere safe, and suddenly it's not so. It's taken me, as a fairly confident alpha male, about six months to get my confidence back and stop feeling anxious when I go out. We've all had counselling. My son couldn't sleep in his own bed for a month.'

There's little most people can do about this kind of incident, which came as part of a 3% increase in burglary and a 27% increase in street robbery revealed in the recent crime figures, with big cities taking the brunt. But Hadley Wood, in the north London borough of Enfield, is probably the richest enclave in Britain: the incident was one of an escalating series, and the well-heeled residents had the means and the will to do something about it.

Other victims had included the Nigerian striker Kanu, one of several Arsenal footballers who live in the area, along with pop stars and wealthy businessmen. In some cases, people had been followed back from the West End and confronted with weapons as they moved between their car and their well-protected house. After the Richards attack, the residents decided enough was enough and called a meeting.

The outcome was another substantial contract for a private security company, and another step in the seemingly inexorable privatisation of major aspects of public safety. It's a trend that began under the last Conservative government and has been adopted and expanded by New Labour.

The beneficiary in Hadley Wood was SectorGuard, a medium-sized 'manned guarding' company that the residents considered a cut above its rivals in an industry still dogged by a cowboy image. About half the local households are now paying pounds 500 a year for 24-hour uniformed mobile patrols, with panic buttons, hotlines and metal plaques warning would-be attackers to think twice.

David Marks, chief executive of SectorGuard, says experience shows that private mobile patrolling works. 'We've done another scheme not far away in Stanmore, and in the two months before our appointment there were five serious incidents, with people being followed into their homes and threatened with knives in front of their children. Since then, there hasn't been a single incident except the occasional suspect car, and it's five months now.

'In the next five to 10 years I believe there is going to be a significant growth in the proportion of the population living in gated accommodation with some kind of extra security. I hope it won't reach the situation you have in South Africa or the US, where the guards are armed. But some of the crimes here aren't so different now - carjacking and aggravated burglaries. We've only seen the tip of the iceberg.'

The 'manned guarding' sector of the industry, of which Marks' company is a part, has undergone the greatest expansion. This has raised significant public concern in recent years. Figures from the British Security Industry Association show that member companies in this sector have grown from 33,700 staff and a pounds 431 million turnover in 1991 to 75,700 staff and a pounds 1.27 billion turnover last year - and there are many other companies that are not members.

The figures are slightly misleading in that much of the growth was not new business - it consisted of offices transferring in-house security to outside companies, among them familiar names such as Group 4 and Securicor.

But this transfer helped create a competitive bonanza, with firms undercutting each other, paying staff as little as pounds 1.80 an hour until the minimum wage legislation forced rates upwards. Calibre of staff was often low, and the Association of Chief Police Officers estimated in 1995 that 2,600 offences a year were committed by private security staff.

Figures like this became a hot topic in Parliament. Lord Bassam, former Home Office minister, told his fellow peers in December 2000: 'Too often, there is anecdotal evidence that the bouncers who work the dance clubs are themselves controlling the drugs trade. There is also evidence that some burglars have set up small security companies and then gone around their target estates offering security at pounds 1 a week to the householders, giving them an excellent way of casing their potential target.'

The outcome of the parliamentary debates was the Private Security Industry Act 2001. This created a new Security Industry Authority, which will start issuing licences next year to security company personnel once they have been checked by the Criminal Records Bureau. (This is another substantial new task for the CRB, which hit the headlines this summer after failing to complete checks on new staff in time for the new school year.)

Figures from the security industry indicate that only 9% of the country's 2,000 manned security companies comply at present with British Standards on staff vetting and training. The process of licensing them all to similar standards is therefore likely to be long and painful. Many less reputable outfits are likely to go out of business or become absorbed into larger companies with greater resources. After the shakeout, according to some predictions, only about 600 manned security companies will be left standing.

David Dickinson, chief executive of the British Security Industry Association, says the arrival of the Security Industry Authority will drive up both standards and costs: 'Instead of two days' training in an entire career, security guards may soon be required to train for at least 10. Meanwhile, the EC working time directive will mean that the shift-working part of the industry will need more people, and the cost base will go up by between 15% and 30%.

'In the next two to three years you'll also see more electronic equipment and cameras and mobile response units, and less static guarding. The way forward is often described as 'mantec' - an integration between people and technology that is more interesting for staff, with companies recruiting higher up the employment chain.'

Most of us will breathe a sigh of relief if regulation does indeed put better-trained staff, with people skills, into the industry. But Dickinson thinks that although the value of the 'manned guarding' sector will grow, its units of work will not.

Instead, he reckons the real expansion in the next few years will be in the so-called police support market, which is set to grow as a result of the Police Reform Act, passed this year. The Act allows chief constables to use designated non-police personnel, including local council and private security company employees, as 'accredited community safety officers'. These ACSOs will be able to demand the name and address of people involved in graffiti or vandalism, confiscate alcohol and tobacco and issue fixed-penalty tickets for cycling on the pavement, dog fouling or littering.

Objections from the House of Lords persuaded the Government not to give ACSOs the power to detain people for up to 30 minutes, using reasonable force, until the arrival of a police officer. That power will eventually be available, however, to new community safety officers, who will be recruited, trained for three weeks and employed directly by the police.

The first of 500 CSOs took to the streets of London in September, and other police forces are expected to be not far behind.

There are growing signs that the hard-pressed bobby on the beat needs all the help he or she can get, not least because of our general disrespect for the law - Britain has the worst record for shoplifting of any European country.

In London, CSOs will be paid pounds 21,000 a year (including allowances), compared to a new police officer's salary of pounds 26,000 - a 20% saving that makes CSOs popular with Gordon Brown.

But the creation of ACSOs is not the only new opportunity the Act will offer the private sector. It also allows for the appointment of non-police detention officers, who debuted in September alongside CSOs, when they began managing the custody facilities in some police stations. Their powers include the controversial right to conduct intimate searches of suspects without their consent. Although this can mean forcibly looking into people's body cavities, the Home Office says it would be used only in rare emergencies and that it will still be done mainly by medically qualified staff.

The Act also allows the appointment of non-police investigating officers, who will be able to obtain search warrants and seize property. Dickinson predicts that this service could bring another pounds 500 million worth of business a year to security companies - a 12% increase on the current value of the entire industry. 'There's little doubt we're going to see the private sector working more in public-sector areas, but with public-sector standards of accountability,' he says. 'Its contribution will be in prevention and reduction of crime rather than enforcement activities.'

The spread of private-sector security companies into the sphere of criminal justice started in the early '90s, when Group 4 and Securicor began transporting defendants between the prisons and the courts. At first, there was farce and tragedy - seven Group 4 prisoners escaped in a single week, another choked to death in an unattended van. But now the industry claims success and efficiency, with cost savings of between 15% and 20%.

At the same time, the private sector was invited to build and operate prisons, and there are now nine private prisons in England and Wales out of a total of 135, with two more on the way. All three secure training centres for young offenders (between 12 and 17) are run by private companies, with a fourth in the pipeline, as are five of the eight immigration detention centres. Private firms also operate electronic tagging services. Explains Dickinson: 'The value of the 10 major contracts currently let by the Home Office is about pounds 500 million a year, to which should be added the pounds 4 billion quoted earlier to get the total value of the industry.'

A major beneficiary is Premier Custodial Group, which runs four prisons, a secure training centre, prison escort and prisoner tagging services.

Premier is a joint venture between the Wackenhut Corporation of Florida and Serco, a British company: its UK revenues grew from pounds 7.5 million in 1994 to pounds 170 million in 2000, with pre-tax profits of pounds 12.4 million. When Group 4 Falck took over Wackenhut this year it promised to sell Wackenhut's interest in Premier to ease government fears about shrinking competition.

The takeover of Wackenhut completed Group 4's journey from national joke to global empire: it's now the world's second-largest security company after Securitas, employing 215,000 people in 80 countries and with a turnover of pounds 2.5 billion. After Premier and Group 4, there are only two other players in the UK private prisons market - UK Detention Services, a subsidiary of the French multinational Sodexho, which has three establishments, and Securicor, with one.

Some private prisons have performed well. A former Chief Inspector of Prisons, Sir David Ramsbotham, called high-security Altcourse on Merseyside 'the jewel in the crown'. But jewels don't come cheap. Well-run prisons cost a lot, whether private or publicly run (see checklist). Others have struggled - Ashfield, near Bristol, was abruptly taken into public-sector management earlier this year by the Prison Service, which feared Premier would lose control. Two more reverted to public-sector control when Prison Service teams put in lower contract bids, showing that the issue of private versus public-sector costs remains a complex one. There was a riot at Campsfield House immigration detention centre in Oxfordshire some years ago, and Yarl's Wood centre in Bedfordshire was burnt down in February by angry inmates.

Despite the setbacks, private companies are keen to provide more prisons, but prison privatisation remains a hot potato in Whitehall and making profits from incarceration is still found distasteful by many people.

The companies dislike the way ministers and senior prison service officials have tried to use the threat of privatisation to try to lever up standards in public-sector establishments; they would rather see a more straightforward attempt to replace failing prisons and spread good practice.

Whatever happens, the role of private companies in prisons is sure to expand. A Home Office report this year recommended the eventual closure of up to 30 of the most difficult prisons and replacing them with eight large 'super jails'. It suggested a system of mixed management, with the private sector doing the building, maintenance, healthcare, prison shops and workshops, and the public sector running security and custody of inmates.

So times have certainly moved on. 'If you'd said at the end of the 1970s that the private sector would end up running prisons, people would have laughed at you,' says Simon Donegan, chairman of FSG Security, a medium-sized manned guarding company. 'But I think things will go even further, and there's a strong possibility that in 15 years' time you will have a two-tier policing system.

'There'll be a unified national police force for dealing with serious crime, and then there'll be council police forces and private security companies doing the kind of thing on the streets that beat officers were once supposed to do - stopping vandals and so on. And if they're well trained and well paid it will be good for society.'

Donegan runs a company that would benefit, so he would say that, wouldn't he? But he could well be right. The private security patrols that have just started in Hadley Wood would once have had policemen muttering about vigilantes and worrying about their jobs, but that's mostly gone. Prominent at the Hadley Wood launch was Chief Superintendent Janet Williams of Enfield police. 'We are confident,' she said, 'that credible security services, with intelligence links with the police, can assist in crime prevention and reduce the fear of crime among the community.'

In the crime-ridden council estates a few miles away, though, there'll be no such extra protection.

< the="" cost="" of="" britain's="" private="" porridge="" altcourse="" fazakerley,="" liverpool="" run="" by:="" group="" 4="" inmates:="" 920="" staff:="" 455="" cost="" per="" prisoner:="" pounds="" 44,272="" ashfield="" pucklechurch,="" nr="" bristol="" run="" by:="" premier="" prison="" services="" inmates:="" 386="" staff:="" 247="" cost="" per="" prisoner:="" pounds="" 38,968="" parc="" bridgend,="" south="" wales="" run="" by:="" securicor="" custodial="" services="" inmates:="" 951="" staff:="" 415="" cost="" per="" prisoner:="" pounds="" 35,850="" lowdham="" grange="" lowdham,="" notts="" run="" by:="" premier="" prison="" services="" inmates:="" 519="" staff:="" 288="" cost="" per="" prisoner:="" pounds="" 30,673="" forest="" bank="" salford,="" greater="" manchester="" run="" by:="" uk="" detention="" services="" inmates:="" 1,024="" staff:="" 358="" cost="" per="" prisoner:="" pounds="" 27,622="" wolds="" south="" cave,="" east="" yorks="" run="" by:="" group="" 4="" inmates:="" 409="" staff:="" 160="" cost="" per="" prisoner:="" pounds="" 24,540="" rye="" hill="" onley,="" nr="" rugby="" run="" by:="" group="" 4="" inmates:="" 618="" staff:="" 242="" cost="" per="" prisoner:="" pounds="" 22,810="" doncaster="" south="" yorks="" run="" by:="" premier="" prison="" services="" inmates:="" 1,003="" staff:="" 619="" cost="" per="" prisoner:="" pounds="" 20,268="" dovegate="" marchington,="" staffs="" run="" by:="" premier="" prison="" services="" inmates:="" 800="" staff:="" 419="" cost="" per="" prisoner:="" not="" available="" by="" comparison,="" the="" average="" cost="" per="" prisoner="" in="" the="" public="" sector="" 2001-02="" is="" pounds="" 23,500.="" source:="" home="" office.="">

HOLDING BRIEF: It's a police officer, but not as we know it.

At the end of September a new breed of uniformed official appeared on the streets of central London with a mission to boost security and reassure the public. They're called Police Community Safety Officers, and by early next year there will be several hundred of them. They're employed by the Metropolitan Police, but they don't have full police powers and don't carry batons, CS spray or handcuffs. They don't have powers of arrest either, but they're allowed to detain you until a police officer arrives.

UP IN SMOKE: Yarl's Wood 'immigration removal centre' - seen here still smouldering after it was burned to the ground in February 2002 - shows that private places of detention are not always lucratively trouble-free. The fire led to a minor crisis in private prison development after insurance companies declined to offer further policies on such institutions. Insurance deals have now been renegotiated with government, a process that has delayed new prisons in Ashford and Peterborough.

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