Re Contract

Serco selected as preferred bidder for two significant new UK prison contracts
valued at around £600m

29 June 2009

Serco Group plc (Serco), the international service company, announces that its
consortium has been selected by the UK government's National Offender
Management Service (NOMS) as the preferred bidder to provide and operate two
new prisons at Belmarsh West, London and Maghull, Liverpool.

Under Design, Construct, Manage and Finance contracts, Serco will operate the
prisons and these contracts are expected to have a combined value to Serco of
around £600m over 26½ years. Serco will now finalise commercial arrangements
with NOMS. It is anticipated that construction of the prisons, by Serco's
construction partner Skanska, will begin in the first half of 2010, with
completion in the second half of 2011. Equity and debt finance will be provided
by third parties.

The prisons will be designed and built to Category B standards, and will
accommodate up to 900 male prisoners for Belmarsh West and 800 for Maghull. As
well as ensuring a secure and safe environment, Serco will use its operational
expertise to ensure a highly effective and efficient prison design, to train
and mentor new staff and to deliver a range of innovative services. In
conjunction with its partners Turning Point and Catch22, Serco will seek to
create an environment for change in order to discourage offenders from
reoffending and prepare them for employment on release, and will also support
effective delivery of services such as healthcare and education in conjunction
with other providers.

These contracts will represent a further extension of Serco's home affairs
business, which has developed strongly in recent years. In the UK, Serco
already manages four adult prisons (the capacity of two of these has recently
been extended), a Young Offenders Institution, and a Secure Training Centre for
young people, as well as providing electronic monitoring and court escort
services. The UK government has recently announced plans to commission a
further five new prisons from the private sector, and to put the management of
a number of existing state-run prisons out to competitive tender.

Serco has also successfully transferred its offender management capabilities
from the UK into other geographies, notably Australia where Serco now manages
two prisons and has today announced that it has been awarded a significant new
contract to transform Australia's immigration centres.

Christopher Hyman, Chief Executive of Serco Group plc, said: "We are proud to
extend our partnership with the Ministry of Justice and NOMS. We are committed
to providing safe, secure and cost effective regimes and offender accommodation
that reduce reoffending and which support offenders in leading more fulfilling
lives once they have been released. Governments around the world are facing
increasing justice and homeland security challenges, and we are seeing
significant opportunities to use our skills to support them."

Ends

For further information please contact Serco:
T [phone]
Charles King, Head of Investor Relations
Dominic Cheetham, Director of Corporate Communications

About Serco

Serco is a FTSE 100 international service company, which combines commercial
know-how with a deep public service ethos.

We improve services by managing people, processes, technology and assets more
effectively. We advise policy makers, design innovative solutions, integrate
systems and - most of all - deliver to the public.

Serco supports governments, agencies and companies who seek a trusted partner
with a solid track record of providing assured service excellence. Our people
offer operational, management and consulting expertise in the aviation, BPO,
defence, education, health, home affairs, local government, science,
technology, transport and the commercial sectors.

More information can be found at www.serco.com