Labour's shadow justice secretary Sadiq Khan has suggested that the coalition should bar G4S and Serco from bidding for future government contracts, including a tender to run the probation service.
He also called for both the police and Serious Fraud Office to investigate all of the contracts that both companies currently hold with government departments.
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The shadow home secretary, 63, said she worked in the Home Office for nearly three years when she was a trainee.
Home Secretary Amber Rudd has attacked Labour's capabilities to effectively deal with any future terrorism threats facing the UK.
Tori Lee Castillo, 39, has been arrested on suspicion of child abuse.