Everything must go

The government is in a desperate hurry to sell off whatever it can of the remaining shreds of the public sector.  Yesterday it announced the winning bidders for the Transforming Rehabilitation contracts, that hugely dangerous outsourcing of probation services.  As we can see from the Guardian's report on this, two companies get more than half the business.  Sodexo gets six areas, Interserve five; of the rest of the 21 areas, Working Links gets three and Ingeus two.  All have signed up charities to do the work.  Between them they will handle more than half of the probation service work, with supposedly medium and low risk offenders.  Their profits will be on a payment by results basis, albeit under a more complicated system than that of the Work Programme.  G4S and Serco had to withdraw their bids because they are still under investigation for fraud.  A4e, we understand, also withdrew from the process.
It's bad enough that such we have to watch this vital work flogged off for private profit.  Worse is the fact that the companies' profits have been insured against a new government pulling the plug on these contracts.  They are guaranteed their expected profits for 10 years!  So it would be ruinously expensive to cancel them.

We also heard yesterday of the company replacing Atos in the WCA contracts.  It's Maximus, an American company with as dreadful a record in the US as G4S and Serco have here.  For details, look at this piece on the Disability News Service site.  We can't know the financial arrangements that brought Maximus into this, but we should.

We learn from the Guardian that the government is pressing ahead with another disturbing outsourcing scheme; that of child protection services, currently the responsibility of local councils.  A lot of people are not aware that private companies already run children's homes, looking after the most vulnerable children for profit.  Now the government wants to take child protection out of the councils' hands altogether.  It might be thought that, given the stream of news recently of councils' failings in this area, it couldn't be any worse.  But councils are accountable for what they do.  Private companies just want to make a profit.

You will have read today that the government has considered cutting ESA to only pennies above JSA level.  It denies that it's actually going to do it, and the cries of protest will probably stop it this side of an election.

Two verdicts on Universal Credit

Two programmes looked at UC last night (I had to catch up on both online this morning).

The first was a Channel 4 Dispatches programme.  Now, Channel 4 brought you Benefits Street, and the producers of that pernicious propaganda recently insisted that they wouldn't be "censored" and will go ahead with the next rotten slice; so could we trust the channel to do something truthful on UC?  Amazingly, yes.  Liz MacKean, a real journalist, went to Warrington earlier this year to look at how it was working.  They found four claimants, who could never be describes as scroungers, who had suffered problems and hardship because of mistakes, delays, confusion and poor staff training.  There were tales of the system not being able to cope with a change in circumstances; of the huge hike in rent arrears and debt.  A whistle-blower from a DWP service centre spoke of staff being overwhelmed by the workload.  Significantly, perhaps, it was Mark Harper, the newish minister for the disabled, who was put up to answer for all this.  He seems to be the new face of the DWP; Iain Duncan Smith and McVey are both, perhaps, seen as liabilities.  Harper talked blandly, of course; but there seemed no recognition that real people are suffering real harm as they "learn from their mistakes" at the DWP.

The second programme was a Radio 4 Analysis episode.  Most of it is summarised in the presenter's own piece in yesterday's Guardian.  Jonathan Portes used to work at the DWP so has an insider's view of what has gone on.  The radio programme was striving for "balance".  We got Kwasi Kwarteng, a Tory MP, making excuses for Duncan Smith.  Worse, we got a sizeable contribution from Fraser Nelson.  He's the editor of the Spectator, a small circulation right-wing magazine, and he also writes for the Telegraph, for which he has produced the most deluded tosh about "welfare reform".  He repeated it on the radio.  (For balance, Margaret Hodge told the truth.)  We got a damning description of the failures of IDS, in UC and in the Atos fiasco.  There was no mention of the dreadful damage that's been done to real people because of IDS's delusions, just a description of the financial costs.

Everyone except IDS seems now to agree that UC is a write-off, and will be ditched whoever is in power after May.

Harking back to yesterday's post, A4e have tweeted an apology.

Whose fault?

One of our regular commenters (is that a word?) has been pressing a story on me which I saw yesterday and was a bit reluctant to post about because it's not clear who is at fault here.  The story appeared in the Liverpool Echo first.  It concerns a 58-year-old unemployed man (worked all his life, made redundant) who was told by the Jobcentre that he was to be referred to A4e.  He then had a heart attack.  His wife phoned the Jobcentre and asked them to inform A4e.  The man lay in hospital waiting for major surgery.  But a phone call was put through to him - from A4e.  This is where it gets contentious.  The message about his illness obviously hadn't got through, but the DWP's comment is that "correct procedures had been followed"; that actually means, "I haven't a clue about this case but it wasn't our fault".  A4e says they didn't know about his illness, which is feasible, but they also say that they ended the call as soon as they realised Mr Rogers was in hospital.  But Mr Rogers himself says, "This guy was persisting about wanting to discuss the next plan of action but I said I was ending the conversation and put the phone down.”  Whichever, it's not good publicity for A4e, especially as the Mail has now taken up the story.

There's a programme on Channel 4 tonight about Universal Credit.  Should be worth watching.

Bad news and no news

There's a bit of news today which provides no comfort for A4e.  Big reforms to pensions come in next year, and the government has recognised that people will need advice and guidance.  It was expected that the Money Advice Service (MAS) would be the outfit to deliver that; but no.  The Pensions Advisory Service will deliver the non-face to face guidance, while Citizens Advice will handle the face to face service.  What has that got to do with A4e?  Well, it's A4e which has the contract from MAS to do the face to face money advice, a fact which is still nowhere mentioned on the MAS website.  So what might have been a new source of work for A4e won't be.

The "no news" refers to the silence over the Slough fraud case.  If you need a reminder, there's this from the Daily Mail.  Five A4e employees were convicted of fraud early this year, having pleaded guilty to using forged paperwork to make false claims.  Sentencing was delayed, presumably until the trial of the remaining 8 accused, who were, we were told, due to go on trial in October.  I assumed that these ex-employees had pleaded not guilty, hence the delay.  Okay, there are two weeks of October still to go, but will we hear any more of this case?  I know it's small beer compared to the massive frauds by G4S and Serco, apparently forgiven by the government.  But we need to hear the full story.

The future of work

If you didn't see the Panorama programme last night, you really should.  It's on iplayer.  It's called Workers on the Breadline and is a real eye-opener for those who think poor people are all idle and feckless.  It looked at working people whose incomes have to be topped up by tax credits.  (The presenter used the word hand-outs a lot, and I objected to that, but perhaps he was just reflecting the language of the right-wing press.)  There were couples where both partners worked (and had no more than three children) but even with WTC were living on the edge; and there was a single man, Jason, working in a zero hours job, earning around £10k a year and getting only £300 a year in WTC.  These were real people, struggling (and in Jason's case drowning) and knowing that it will only get worse.  It was pointed out that working overtime or extra hours isn't the answer because you lose most of your benefit, and for people with children the cost of childcare is impossible.  I haven't seen the BBC do anything this competent and important for years, so it's sad to learn that they're ditching all investigative reporting from Panorama.  There were no politicians waffling; the positions of the two main parties were set out succinctly.  And two authorities offered no solutions, admitting that Britain has become a low-skilled economy and wages are far too low.  While education and skills would seem to be important, one said, if you come out of university and the only work you can get is stacking shelves, that in itself isn't the answer.
There was a disturbing report from Liverpool on Saturday that half the jobs on Merseyside are now temporary agency jobs.  (See this Liverpool Echo piece.)  Agencies like Prime Time get hand-outs from the government to take people on under the Work Programme then pay them so little that, after travel costs, they can come away with £3.72 an hour.
This is a lunatic downward spiral.  Of the families featured on the Panorama programme, one husband and wife both work at Tesco.  But they can't afford to shop there.  All the big supermarkets are losing market share to the discounters.  And that's just one obvious result of how making people suffer frozen wages and benefit cuts impacts on the economy as a whole.  Those at the very top rake in a bigger and bigger share of the nation's money, but they don't spend it down at the supermarket.

What is the answer, then?  Raising the minimum wage is an obvious part of it, despite the protests of business that they can't afford it.  Genuine skills training has to be in there too.  Jason said in the programme that the only way he could see of getting a better job was to have a driving license, but he obviously couldn't afford driving lessons.  Why not set up a free driving school for people in his position?  And anyone who has spent years working in a particular industry and then loses his job should be re-trained.  Another component is to get rid of all the free labour, workfare schemes which allow companies to avoid actually hiring people.
The answer is not the Work Programme.  Both Labour and the Lib Dems have come round to the idea that local councils have to be in control of this.  They couldn't just end the contracts but they could negotiate changes which would give councils the power to commission programmes suited to the needs of their areas, and to use the money currently being wasted on the WP to fund the the schemes many councils are already operating in conjunction with skills training organisations.

The status quo is not an option for much longer.

Quick question

I'm not clued up on Working Tax Credits, but I'm sure some of you are, so answers, please:
If someone who is on WTC gets more in their pay packet, through a rise in the minimum wage, or a rise in the tax threshold, do they get a corresponding decrease in WTC, so that their income remains the same?  Yes, no, more complicated?