Profits plummeted at Capita Translation and Interpreting after taking on the ‘onerous’ £15m courts interpretation contract last year, the company has revealed.
The company’s turnover increased from £6.8m for the last seven months of 2011 to £21.1m over the full-year of 2012. However, gross profits fell from £2m to £600,000 over the same period. Operating costs also increased from £1.6m to £15m.
‘The increase in turnover and operating loss is due to the onerous courts interpretation which commenced in early 2012,’ says the company in the directors’ report for the year ending 31 December 2012.
Madeleine Lee, director of the Professional Interpreters’ Alliance, an umbrella group of interpreters’ organisations that oppose the contract, said the loss reflects poor management. ‘The entire premise of the bid was too low and undeliverable,’ she said.
A Capita spokeswoman said: ‘Capita Translation and Interpreting has invested significantly in the Ministry of Justice contract to enable it to deliver the high standard of service which the MoJ and the court system expects. We therefore never expected to make a profit in the first year of the contract.’
Capita has also been named as a preferred bidder for the MoJ’s electronic tagging contract, in a deal that will create £400m in revenue for the company over six years.
The MoJ has increased spend significantly with Capita since 2010/11, from £3.9m to £25m in 2011/12.