POLITICIANS and campaigners urged the government to sack contracting giant Serco today after the outsourcing company announced that its profits are set to soar due to an increase in government contracts.

Labour MPs have hit out over the government’s continuing relationship with Serco after the company was awarded the contract to operate Britain’s contact-tracing system, which is set to make it £45 million. 

The company said that the excess profits could now be returned to shareholders, with a consultation on dividend payments under way.

Serco now expects a trading profit, before any one-off costs, of between £160m and £165m; up from previous estimates of £135m to £150m.

The government has been urged to rethink its approach to outsourcing public services, with opposition MPs arguing that test and trace work should be handed to local public health teams. 

The announcement comes a day after NHS test and trace recorded its worst ever week for contact tracing, as cases of coronavirus continue to rise.

Shadow minister Rachel Reeves described the announcement as “grim beyond belief,” claiming that “people are paying the price” for Serco’s failures. 

The Labour MP said: “If the government can’t bear to curb its obsession with pouring money into big companies over our local public health teams, it surely can see that this wasteful approach lacks basic common sense and isn’t reducing the transmission of the virus.

“It is time to sack Serco and bring in a short circuit-breaker, so we can fix test and trace, protect the NHS and get control of the virus.”

Anti-privatisation campaigners We Own It backed Labour, adding: “It’s time to sack Serco and get public health teams leading test and trace, exactly as they should be.”