The Channel logo

News

By | Christopher Williams 1st November 2010 15:14

Serco apologises for chiseling suppliers

City and Cabinet Office unamused

Serco, one of the largest IT suppliers to government, has today apologised to its own suppliers for trying to squeeze them for 2.5 per cent cash rebates on existing contracts.

The retraction follows a report in a Sunday newspaper, which said the Cabinet Office was angered by the firm's treatement of its partners.

"As a company that values our relationships with all our supply chain partners, large and small, we deeply regret this action and apologise unreservedly to them for the concern that this has caused," Serco said.

Finance director Andrew Jenner had previously written to 200 suppliers claiming that the Cabinet Office's efficiency drive meant it needed rebates.

In apparent arm-twisting, he wrote: "Your response will no doubt indicate your commitment to our partnership but will also be something I will seriously consider in our working relationship as Serco continues to grow."

Francis Maude, the Cabinet Office minister responsible for government IT, reportedly called Serco for an explanation of the tactic.

Ths stock market also reacted badly to Serco's embarrassing about-face today, sending its stock down more than six per cent this morning. ®

comment icon Read 12 comments on this article alert Send corrections

Opinion

Chris Mellor

Drives nails forged with Red Hat iron into VCE's coffin
Sleep Cycle iOS app screenshot

Trevor Pott

Forget big-spending globo biz: it's about the consumer... and he's desperate for a nap
Steve Bennet, ex-Symantec CEO

Chris Mellor

Enormo security firm needs to get serious about acquisitions

Features

Windows 8.1 Update  Storeapps Taskbar
Chinese Buffet self-service
Chopping down the phone tree to scrump low-hanging fruit
An original member of the System/360 family announced in 1964, the Model 50 was the most powerful unit in the medium price range.
Big Blue's big $5bn bet adjusted, modified, reduced, back for more
Microsoft CEO Satya Nadella
Redmond needs to discover the mathematics of trust