THE security company at the centre of the debacle over the Olympic Games is poised to secure the contract for electronic tagging of prisoners in Scotland.

G4S is looking to win the electronic monitoring contract from Serco, which has run it for the last seven years, and The Herald understands the company has been handed preferred bidder status.

The company's failure to hire sufficient staff to fulfil its Olympics contracts forced the UK Government to mobilise an additional 1200 troops to supplement the security operation, taking the total number of service personnel involved to more than 18,000.

Labour last night called on the Scottish Government to intervene before the contract is finalised to ensure there was no danger of another debacle involving the company.

Lewis Macdonald, Shadow Justice Secretary, said: "[Justice Secretary] Kenny MacAskill needs to intervene in the procurement process and, before any contract is awarded, ensure any failures from G4S do not mean the public purse is again used to pay to clean up their mess."

He said of G4S: "Their reputation across Britain is shredded and I think every Scot would want reassurance that offenders who have been tagged are monitored properly and corners aren't cut. We can't afford to suffer the results of another G4S fiasco."

G4S is the biggest security company active in Scotland, operating the likes of private security at the Scottish Exhibition and Conference Centre, and it also holds the contract from the Scottish Prison Service to transport inmates between jails and courts.

Last week, Strathclyde Police announced the force was taking over direct responsibility for security at the Olympic football matches at Hampden from the security firm, with Shadow Scottish Secretary Margaret Curran saying G4S should be billed for the cost of this.

It was also reported this week the security firm had allowed staff several attempts to pass tests on using X-ray scanners to detect bombs, which was claimed amounted to officially sanctioned cheating. Training on the equipment was said to amount to just 20 minutes.

The Commons Public Accounts Committee was scathing about the escalating costs of the Olympic security bill and criticised a 12-fold increase in the management fees being levied. G4S chairman Nick Buckles has admitted the Games debacle could cost his firm future public contracts.

Outsourcing giant Serco won the Electronic Monitoring Scotland contract in 2006 on a five-year contract and then earned a two-year extension. Now tendering is under way for the new contract and The Herald understands the frontrunner is rival firm G4S.

Industry sources have confirmed to The Herald that G4S has won preferred bidder status but neither the company nor the Government is prepared to comment on this.

A Scottish Government spokesman said: "It is not appropriate to comment on an ongoing procurement process."

On its website G4S says: "We are the world's largest provider of electronic monitoring services, monitoring over 40,000 subjects every day."

The website adds: "We provide a comprehensive range of services that support the work of criminal justice and immigration agencies across the world."

The company operates tagging covering 14,000 cases across much of England. The company adds: "We also monitor subjects on behalf of the UK Border Agency either through electronically monitored curfews or voice verification."

Serco currently employs 100 staff across Scotland, including its control centre in East Kilbride. Since the contract began, Serco has managed more than 12,200 offenders.

The company has designed and introduced a vocational qualification solely for the use of staff within this sector, said to be the first of its kind in the UK.