Public money used for private profit
In May 2025, HMRC moved from multiple Facilities Management (FM) contracts to one contract for the West of the UK – awarded to Sodexo – and one contract for the East of the UK – awarded to Mitie. This new model was termed by HMRC as ‘Next Generation Facilities Management’. Six months later the reality has been a backlog of repairs, offices being temporarily closed and FM staff resignations.
The new contract brings together ‘hard FM’ (maintenance and repairs) with ‘soft FM’ (cleaning, reception, cafe) to reduce the number of contracts required. This was supposed to deliver savings for HMRC. It does appear that the winning bids from Sodexo and Mitie come in at a lower cost to HMRC compared to the five previous contracts.
But cheaper is rarely better. It’s important to look at what the contracts are actually delivering to understand if HMRC is getting value for money. HMRC sets standards for hard and soft FM that are supposed to be met under the contract. If these standards are met then the contracts work.
On ‘hard FM’, key performance indicators aren’t being met. Statutory requirements aren’t being completed. Without sign off for the statutory safety of offices, they will have to be closed to staff. HMRC is then left paying rent on buildings it can’t use. Other repairs are mounting up too – broken doors, cracked windows, fallen ceiling tiles, broken taps, broken toilets, faulty plug sockets, the list goes on. Every one of these is another hindrance on the ability of HMRC staff to do their jobs effectively.
On ‘soft FM’, standards are barely met or not met. This isn’t the fault of the hard working staff – they are doing as much of the thankless cleaning and tidying at humanly possible. The problem is the cuts to headcount and hours available that are imposed from the top. Not enough FM staff means the workload is too much for those that remain and not everything can be done. The FM staff suffer the pressure of being expected to delivery the impossible, and HMRC staff suffer the consequences of unclean offices. The only winners are the companies siphoning taxpayer money into shareholder dividends. So much for being the ‘next generation’.
Ebenezer Sodexo cancels Christmas for staff
Even this isn’t bad enough for Sodexo. They are going a step further by seeking to make soft FM staff redundant all across the sites they have responsibility for. Fewer staff will make an already difficult job next to impossible for these staff. This decision is a mistake driven by corporate greed.
But consider the timing – the redundancy consultation is being conducted so that it’s completed by 19 December. What kind of Christmas will Sodexo soft FM staff, when they may not have a role in 2026?
PCS has members in Sodexo. PCS has correctly sought to intervene to support these members. Sodexo don’t recognise PCS and refuse to engage with PCS. There’s mounting evidence that Sodexo are ignoring their own redundancy HR policy and possibly employment law as well.
PCS has raised concerns with HMRC. Sodexo have assured HMRC they will still be able to meet key performance indicators, so HMRC have decided this isn’t their problem. All too often HMRC has tried to wash its hands of responsibility for privatised services. It was this attitude that allowed the Concentrix debacle to happen (see https://bln.org.uk/2025/07/08/fight-back-against-hmrcs-outsourcing-plans/). It was HMRC that suffered the reputational damage and the consequences. PCS must continue to pressure HMRC to intervene before the damage is done by Sodexo.
Mitie now implementing staff cuts
Even as PCS is looking to intervene at Sodexo, Mitie have made the disgraceful decision to make its own cuts. Little information has been shared with PCS about Mitie’s plans. Mitie what don’t recognise PCS and refuse to engage with PCS. Once again the HMRC says this is a matter for the private contractor and they can’t (or rather they won’t) intervene.
The implication is that HMRC will have at least 100 fewer cleaning staff at offices in 2026. This would be bad at any times, but it comes even as HMRC seeks to restack it’s offices to increase capacity for people. So more members in offices using the facilities, more desks to clean, fewer staff at Sodexo and Mitie to deliver the essential services. HMRC is putting cost savings ahead of staff health and welfare.
No lessons learned by HMRC
In 2001, nearly all Inland Revenue and Customs & Excise buildings were sold to Mapeley and then leased back from Mapeley. Even at the time of this arrangement, it was controversial. Mapeley were based in Jersey so the profits of made on the contract weren’t taxable in the UK.
As time went on, Mapeley proved to be an unreliable landlord for HMRC. Repairs were slow or just not completed. The Office of Budget Responsibility reviewed the contract and found HMRC only made ‘savings’ from office closures – and those savings were inevitably offset by other costs like redundancy payments.
Time and again, HMRC has entered into contracts with the private sector that don’t deliver benefits. Whether it’s Mapeley, Concentrix, Fujitsu, Sodexo or Mitie, the private sector is a parasite on the public sector.
This Labour government stood for election in 2024 on a manifesto that included the following:
“Labour will learn the lessons from the collapse of Carillion and bring about the biggest wave of in-sourcing of public services in a generation. A Labour Government will end the Tories’ ideological drive to privatise our public services, extend the Freedom of Information Act to apply to private companies that hold contracts to provide public services, exclusively with regard to information relevant to those contracts, to ensure any outsourced contracts are transparent and accountable for delivery. We will also extend the Freedom of Information Act to publicly funded employers’ associations, where not already covered.”
This manifesto promise – like many others – has been ignored. Along with disgusting attacks on migrants, pensioners, the disabled and the watering down of it’s promises to the trade unions, Labour is once again affirming it’s position as a representative of bankrupt British Capitalism.
Fight back!
This threat to members’ jobs and conditions cannot be allowed to go unanswered. So what can be done? Here is what the BLN says:
The HMRC GEC should publicly call on HMRC to end the ‘Next Generation’ FM contracts and bring the services in-house.
Current staff at Sodexo and Mitie working in HMRC offices need to be offered roles in HMRC – earning the rates of pay and terms and conditions negotiated by PCS and expected for all HMRC staff.
Every PCS branch in HMRC Group needs to recruit the hard and soft FM staff in their office into PCS. Union membership is their best protection against exploitation.
Every PCS branch in HMRC Group should organise meetings of HMRC and FM members. The meetings should be used to fully brief members about the situation in FM, and gather the views and the fighting ideas of our members.
While the ‘Next Generation’ FM contracts remain in place, the HMRC GEC must organise to seek recognition rights with Sodexo and Mitie for the staff working at HMRC offices.
PCS Broad Left Network 