Thursday, 30 July 2009
Tuesday, 28 July 2009
- Are there sufficient safeguards in place to prevent providers from making fraudulent claims for outcomes they have not achieved?
• Is there sufficient protection for employees who raise concerns about their employers’ delivery of a contracted employment programme?
• Does DWP’s contract management approach ensure the quality of service received by customers is commensurate with the level required under the contract terms?
• Do DWP and the National Audit Office effectively monitor the accuracy of providers’ management information systems, provider performance against targets, and the evidence on which provider payments are claimed?
• How has the centralisation of contract management in DWP impacted upon the role of Jobcentre Plus and both provider and customer experience of outsourced employment programmes?
• Will the customer charter proposed by DWP ensure that customers, Jobcentre Plus and contractors know what they can expect of employment programmes?
• Will contract management in the prime contractor model be transparent and effective in monitoring quality throughout the supply chain, and in maintaining a role for sub-contractors?
Saturday, 25 July 2009
Thursday, 23 July 2009
Wednesday, 22 July 2009
Friday, 17 July 2009
Thursday, 16 July 2009
Wednesday, 15 July 2009
Basically, it alleges that A4e had contacts with the most influential politicians before the bidding process started for the welfare-to-work contracts there. The implication, of course, is that the private meetings influenced the destination of the contracts. Perish the thought! A4e wouldn't do anything like that, would they? Despite all the meetings that went on, the government department denies that there was anything wrong. But the article, which points out that "A4e has strong links to the British Labour Party and is being investigated by the UK Government for alleged fraud involving work placement contracts" also draws attention to an intriguing fact. "A4e executives met Ms Gillard's [the Employment Minister's] deputy chief of staff, Tom Bentley, in February last year to discuss the Government's plans to reform employment services for Australia's unemployed. A4e had no contracts in Australia at this time." Now, this same Tom Bentley "worked in Mr Blunkett's ministerial office as a special adviser on school reform and social inclusion" in 1998/99. It's worth reading the whole article. A4e's reputation has travelled, and the Australian press is saying things that the British press daren't.
- Train to Gain is a government scheme under which employers are encouraged to release members of their staff to take an NVQ Level 2, by paying their wages for the time they spend on the course. A4e won a large number of these contracts in the short term, but created a tortuous administration which hampered the scheme, and the company subsequently lost many of the contracts.
- Recruitment services, particularly in education and the NHS.
- Online business courses for Learndirect.
- OLASS - Prisoner education contracts in four areas of the country. Perhaps A4e saw this as similar to training the unemployed but with less chance of the clients dropping out! Certainly they saw the benefit (to them) of tacking the New Deal stuff onto the education programme. One problem they hit was in staffing; they had to take on existing teaching staff but could not join the teachers' pension scheme, and this meant that staff were worried about a possible reduction in their pensions.
- Money advice Courses on money management are provided to schools. Stoke Council have given A4e a contract to give money advice to council tenants, in a scheme which in July 2009 claimed that "Almost 2,800 residents have been helped to reschedule £9.6 million worth of personal debt and receive over £3.5 million in unclaimed benefits". All this has inspired Emma to go further. She wants to start a bank aimed at the poor. She said recently that she hopes to have three trial branches operating within 18 months. Encouragingly, a partnership with RGMR consultancy has secured a titbit from the Treasury to pilot generic financial advice initiatives.
- A4e were, on 14 January 2009, announced as one of the "partners" in a Money Guidance pilot programme in the North West and North East, along with genuine advice agencies like the CAB and the Consumer Credit Counselling service.
- Social Care As the government pursued the idea of direct payments for social care, A4e was in there, waiting to grab a slice of the cake. By late 2008 it had 12 contracts across the country, including Middlesborough and Somerset.
- CLACs Intentionally or not, the government created another opening for A4e when it sought to reduce the bill for legal aid. Local authorities which used to fund advice charities like CAB now have to put these out to tender, seeking bids from partnerships between solicitors and advice organisations. The first of these was in Gateshead, where the voluntary sector managed to win the contract. But A4e got its act together for the next offering in Leicester, and won the contract. In Hull it was also announced as the preferred bidder, and despite a determined campaign by the CAB the Hull CLAC opened its doors in December 2008. The government has since had to rescue the Hull CAB, and has decided that CLACs are not a good idea.
- Choice Advisors Along with Centra, A4e have the contract for the Choice Advisors Support and Quality Assurance Network, which "supports" people in local authorities who advise parents on school admissions.
- An education business link organisation consortia (EBLOC), which organises work-related learning activities across the four local authority areas of the Tees Valley. This gives A4e a foothold in schools.
It's a Frequently Asked Question - how has A4e managed to insert itself into so many "markets"? With the reputation it has, how does it secure contract after contract? There are two main reasons:
- When considering bids for a new contracts, government departments are not allowed to take into account the previous records of the bidders. Odd? Yes, and it means that you can bodge one contract but secure the next.
- Local authorities which feel that they can't, or don't want to, provide a service in-house have to go through rigorous procurement processes. They have to accept the bid which offers "best value", which is not necessarily the cheapest - but if it's not the cheapest they have to have a very good reason, and not liking a particular company isn't good enough.
In 2006 the government decided to sack a lot of the Jobcentre staff who had been responsible for organising the back-to-work schemes and contract out this organisation region by region. A4e won many regions, mainly by promising a 55% success rate. Everyone in the sector knew that this was ridiculously optimistic. Given the numbers of people forced onto the schemes who are, for various reasons, unemployable a good rate would be around 30%. And the results for the year to March 2009 show that the highest rate that A4e achieved was 33% (with the FTET group). With older clients the job outcome rate was 22%. There have been no moves to sue for breach of contract.
There are several New Deal programmes, but they boil down to two types. One is Gateway, a two-week course for under-26s, aimed at providing an intensive programme of support and encouragement. All other programmes last for 13 weeks, and preclude the kind of genuine skills training that was integral to the old New Deal. Only very short training courses can be undertaken, and the costs of these have to come out of the provider's budget, so there is little incentive to fund them. Clients are supposed to be placed with employers for work experience, but there is a severe shortage of employers willing to take them on, so increasingly the placements are with the voluntary sector. A4e developed the practice of paying voluntary organisations small sums to take these clients. As unemployment increased rapidly in 2009, the pressures became severe, with higher numbers of clients being referred for "training" which they increasingly saw as pointless. A piece on Radio 5 Live in 2009 exposed the discontent of many clients at the poor service they believed A4e to be offering, and Ofsted's poor opinion of the company. In June 2009 BBC's Look North programme in Hull reported on criticisms by two A4e clients of the waste of time and money of the programme.
The New Deal contracts encourage providers to maximise profits by minimising costs, and the costs are principally staffing and facilities. The effects of cost-cutting were exposed in March 2008 when the Manchester Evening News reported Jobseekers treated "like cattle" Similar scenes were reported in Sheffield and in Newport, South Wales, usually on local forums or private blogs. Such complaints must be treated with a degree of caution; most of the people on the schemes don't want to be there. But a picture emerged of clients kicking their heels in poor facilities with inadequate (and under-skilled) staff. There is a maximum payment to the provider for each client, and it is paid in two ways. "On programme payments" are made for each week, or part-week, that the client is with the provider. Job outcome payments are made when the client gets employment which is certified to be of 16 or more hours per week and expected to last for 13 weeks or more. If the client leaves the programme for a job before the 13 weeks are up, and stays in the job for 13 weeks, the provider can claim the "rolled-up weeks", the on-programme payments for the remaining weeks.
- Low job outcomes (4)
- Insufficient identification of participants' needs or barriers to employment (2)
- Weak target-setting (4)
- Inadequate or slow approach to quality improvement (6)
- Insufficient use of data and monitoring (3)
- Inadequate use of teaching or resources (3)
Tuesday, 14 July 2009
The breakthrough came with the Labour government's New Deal programme. A4e rapidly became the "preferred bidder" for contracts to provide back-to-work training. Their success baffled their competitors, who knew they were putting in equally good bids. This led to rumours that it was Emma's connections who were responsible. Someone high up in government, perhaps? A Sheffield MP name of Blunkett, maybe? But there was no evidence for this, and rival training companies went out of business as A4e prospered.
Business Link - questions in the House In 2001 the Business Link organisations, which had been formed locally, were put out to tender by the government. A4e bid for all of them. In their determination to get the contracts they were prepared to stretch the truth. In Somerset they had stated that local leaders, including the leader of the Council, supported the bid. That was news to the gentlemen in question, and the bid had to be withdrawn. In Humberside it was felt that something similar was happening, but government ministers seemed intent on awarding the contract to A4e. The company scooped up the majority of these contracts nationwide. They lost many of them in 2007.
EI EXCLUSIVE: Britain's double game In 2005 suspicions were heightened when A4e was able to work in Israel, in contravention of British government policy but apparently with British Embassy assistance. The contract also marked the beginning of A4e's expansion into the international market. They have been able to boast of their success in Britain in "reforming" public services, and by 2008 were being described as a £120m global organisation. In Israel, business appears to be going well. See an article in the Jerusalem Post, where A4e's genius for propaganda is well demonstrated. The company is now known as Amin in israel.
A4e operates in a growing number of countries, trading on their claim to be "the UK’s largest private provider of public services in the labour market and social integration sectors, including the welfare to work programme ‘New Deal Prime Contractor'". They are established in France, Germany and Australia. We also learn from a Polish journal that it "currently manages two projects in Poland, in Szczecin and in Zabrze, supporting 550 people back into work by the end of 2008". Another developing market is India, where A4e have a foot in the door. Turkey looks set to be the next opportunity, and they are trying to establish themselves in South Africa.
A4e's philosophy is now simple: bid for everything. Currently they employ over 60 professional bid-writers. The drive to diversify in the last few years has been partly the result of a drop in profits. In 2002 -03 A4e was worth £50 million on the basis of profits of £4m and sales of £60m. In 2004 - 05 the figures were £3.9m in profit on £75.7m sales. Note that these "sales" are the money spent on meeting the contracts; profit is what they manage to keep. Profits declined sharply in 2007, as a number of contracts were not renewed. Undaunted, Emma said that she was "proud that the company has sustained pure organic growth at a phenomenal rate" and forecast an increase in profits to a £500 million turnover by 2014.
A4e has set up the Foundation for Social Improvement, which apparently aims to encourage the "third sector", especially smaller charities, to depend on them for training and access to government. They are "proud to be working in conjunction with Communities and Local Government (CLG) to deliver Connecting Communities Plus scheme". The FSI is a "social enterprise", an organisation which blurs the line between the voluntary sector and for-profit businesses. It's another example of the company's ability to infiltrate all aspects of the government's dealings with the most disadvantaged.
A4e's staff, certainly at the lower levels, are paid poorly in comparison to public sector workers. Many are temporary staff or on short term contracts, are minimally qualified. This is inevitable but goes some way to explaining the poor service which many clients experience.
From The Telegraph 9 September 2008 "The latest register of members' interests shows that the former home secretary's incomings over the past year or so were boosted by a £30,000-a-year salary from a Sheffield-based international training and support services company called A4e. This is supplemented by the £50,000 he receives each year from the Sun newspaper, £30,000 from a Texas-based security company called Entrudler he had with Kimberly Quinn, the former publisher of The Spectator. Blunkett, 61, the MP for Sheffield Brightside, has garnered some useful headlines for his new employers A4e with the Star newspaper in his constituency reporting in January: "A4e's free legal line wins Blunkett's approval". That was shortly before Blunkett took a job with the company."
This came as no surprise to anyone who had followed A4e's fortunes from the early days, and who suspected that there was a friend in high places who was instrumental in securing all those contracts. But it does raise questions about how an MP can be employed by a company which has government contracts.