London transport chief says Capita is "performing like a strong organisation" as shares slump continues

 
Rebecca Smith
Capita manages the congestion charge call centre website
Capita manages the congestion charge call centre website (Source: Getty)

London's deputy mayor for transport said she had "no concerns" with Capita and its Transport for London (TfL) work at present, but added that TfL always has a "contingency step-in plan" if issues were to arise.

Shares in Capita sunk yesterday off the back of a suspended dividend and a diminished profit forecast. This afternoon, they were down nearly 12 per cent.

A Cabinet Office spokesperson has said they did not think any of their strategic suppliers, which includes Capita, were in a comparable position to construction firm Carillion. That entered liquidation earlier this month.

Speaking at a meeting of the London Assembly Transport Committee today, Val Shawcross was asked for an update on Transport for London's involvement with the outsourcing giant.

Read more: Capita sees £1.1bn wiped away – but Whitehall says it’s no Carillion

She said there had previously been issues with performance but strong "interventions went in" and Capita "rose to it, because they knew that they could not let the mayor down".

"At the moment they only manage the congestion charge call centre website back office functions, so paying the fees to congestion charging," Shawcross said.

"Over a year ago, around Christmas, some of you will remember that there were a series of outages on that website, and we had some trouble. And we had trouble because they weren't reporting to us that that was happening, very alarmingly, we were hearing from our customers before we were hearing from them."

"That caused us politically, as well as professionally, a lot of alarm, because in particular, Capita were due to be commissioning the changes for the T-Charge functionality," Shawcross said.

Since the intervention, Transport for London (TfL) has had "very, very good service from Capita this year".

Shawcross added:

They are performing like a strong contractor and a strong organisation. TfL always keeps an eye on the financial status of contractors and there is always a contingency step-in plan for every contract, as there was with Carillion.

So, I think at the moment, we've got no concerns, and should they be bidding for any future contracts, there would be due diligence done, as there is always due diligence done on the finances.

Read more: Capita shares drop 35 per cent as it suspends dividend following review

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