The outsourcing giant said extensions to government contracts had boosted revenues in the three months to July. Its revenue for the year is expected to be around £3.9bn - up from a predicted £3.7bn. It expects a trading profit, before any one-off costs, of between £160mand £165m, compared with estimates of £135m to £150m. The company said in a statement that the excess profits could be returned to shareholders in the form of dividends.

The [private sector] test-and-trace system has been criticised for being less effective than local public health teams. Data released on Thursday showed that, in the week to 7 October, NHS Test and Trace reached only 62.6% of people who have been in contact with someone who has tested positive for coronavirus. This figure has been falling as the number of cases increases. Local public health teams, who conduct contract tracing for the most complex cases, reached 97.7% of identified contacts in the same period.

Labour's Rachel Reeves said: "While Serco is raking in the profits, people are paying the price for its failure."

The assistant general secretary of Unison, the UK's biggest union, Christina McAnea, said involving private companies "was a mistake from the start". "Shareholders shouldn't be rubbing their hands with glee when the test-and-trace system is a catastrophe. Infections are rising, hospital admissions are soaring, and test-and-trace has just had its worst week ever. No one should be profiting from failure," she added.

The outsourcing giant published its financial report for 2020 today, showing a surge in profits after being handed £350,000,000 in Government Covid contracts.

Serco is doing so well that it has restarted dividends for the first time since 2014, despite the contact tracing scheme it runs being chaotic and having 'little impact' on controlling the UK's crisis.

Serco's earnings were up 36 per cent last year on 2019 to a total of £163,000,000. Its revenue – total income before expenses – was a staggering £3,900,000,000, up from £3,200,000,000 the year before. Serco said it will pay shareholders 1.4p per share, equal to about one per cent.

The firm is one of the main operators of the Test & Trace scheme, running more than one in four public testing sites and half of contact tracing capacity in some areas.

But the system it plays a huge role in running has been beset by chaos throughout the pandemic, with call centre staff left without work at times and test centres totally overwhelmed at others.

Chief executive Rupert Soames told the BBC's Today programme: "It (test-and-trace) is now a remarkable success and I acknowledge it has taken quite some time to get there."

He said there were now as many people being tested per week as vaccinated.

Mr Soames also defended the company's decision to restart the paying of dividends to shareholders.

He said that test-and-trace had experienced a "bumpy start", but added that a system of its kind had "never been done before in the UK".

"As of last week there are as many people being tested every week as we've vaccinated, about 2.5 million people a week," he said.

"In the first week of January there were about one million people who were traced through the system."

Mr Soames insisted that work from the pandemic contributed less than 1% of profit, although he conceded that it added £350m of revenue.

Mr Soames justified the payments by saying that the company had reimbursed all the pandemic support it had received from the government, and that shareholders deserved some payback having supported the company through dark days when it was forced to call on them for funds.

Mr Soames also said profits from coronavirus work amounted to just 1% of the company's profits.

PUBLIC health campaigners across England will on Tuesday call on the government not to renew contracts with private company Serco for the test-and-trace system.

Protesters are expected outside Downing Street in London at 8.30am dressed as test-and-trace supremo Dido Harding and Serco CEO Rupert Soames, while another protester plans to dress as Health Secretary Matt Hancock with blood on his hands. Dozens more actions co-ordinated by We Own It will take place.

Serco has held contracts for contact tracing since May 2020 but has repeatedly failed to deliver on its duties. The system has reached just 81 per cent of close contacts, those who had tested positive for Covid-19, and asked them to self-isolate since the programme began, according to the latest government statistics. This compares with nearly 98 per cent for local public health teams.

We Own It campaigns officer Pascale Robinson said: “Even with vaccines being rolled out, effective test and trace is still going to be absolutely vital to halt the spread of Covid-19 in our communities and stop new and more deadly variants from emerging. Time and time again Serco has proven utterly incapable of delivering an effective system and the company’s failure has put countless lives needlessly at risk. The government must now face reality. Local public health teams have consistently shown they can deliver contact tracing far more effectively. ”