Saturday, 31 March 2012

Notes on comments

While things are quiet I'd like to make some points about comments to this blog. Comments are moderated.  I reject as many as I publish, for various reasons.
  • they contain offensive language (and it's my decision as to what is offensive) 
  • they are abusive towards individuals or groups
  • they make allegations which may or may not be true, but I am in no position to verify them
  • they are illiterate.  I don't require perfect English, but some people obviously don't read what they type.
  • they add nothing to the discussion
I sometimes make the decision to terminate a discussion if it is deteriorating into a slanging match, or someone wants to have a personal argument with me.  It's my blog, after all!
There is a continuing problem with people who don't acquire a pseudonym and simply call themselves "Anonymous".  It can get very confusing.  I don't want to insist that you get a pseudonym, but there's no reason why you shouldn't.  There is no way of identifying you.
If you don't want a comment published, but just want to tell me something, say so at the beginning of the post.  Bear in mind that I can't edit a comment; I can only reject or publish it.  So I can't take out anything and publish the rest.
If you want to reply to another comment, use the "reply" button under that comment.
I use Google alerts (not the same thing as Google search), so I'm usually aware of the latest press and internet pieces.  If you draw my attention to something in the news, I may well be aware of it already, or I may choose not to publish it because I want to do a post about it.  Don't take offence if I don't publish your comment.
I will never publish email addresses.  If you want to contact me directly you can send a comment including your email address.  But I will only reply if I think you have a bona fide reason for wanting to make contact.
Finally, I am grateful to everyone who takes the trouble to comment on posts.  

Thursday, 29 March 2012

"The Report" revisits the Work Programme

Six months after it first looked at the Work Programme, The Report on BBC Radio 4 revisited it.  Helpfully, the BBC published a piece on its website which could have avoided the need to listen to it at all.  But it was interesting.  The main focus was on those charities and voluntary organisations which are struggling, finding the WP not financially viable.  Despite gagging clauses in the contracts which forbid sub-contractors from doing anything to "damage the reputation" of the primes or "attract adverse publicity, one charity, the Single Homeless Project, has pulled out of its contract with Seetec and has been the first organisation willing to talk to the media.  What it boils down to is that the primes, the big companies, are not passing down the money to the charities to enable them to deliver the support necessary to the clients; they are only passing down the risk.
The Boston Consulting Group has produced a report pointing out that the DWP itself says that the "dead weight figure" - the proportion expected to get work if there was no WP - is 28%, and the assumption in the WP is that between a half and three quarters of the money paid out will be on those dead weight numbers, i.e. unnecessarily.  Chris Grayling and the DWP say that this is a misunderstanding of the figures.  Richard Johnson, who used to be with Serco and was involved in the contract negotiations, says that the model is wrong and is encoraging "creaming and parking", as so many said it would.
So what of the clients, asked the reporter.  Of the several clients who were interviewed six months ago, none have found work.  One, an A4e client, has had two interviews but there were 170 applicants for one of the jobs.  He said he had had no support from A4e, but the local office disputes this.
Back to the voluntary organisations, which the primes were obliged to include in their tender for the contracts.  They were called "bid candy" by some, and there are those which were not even aware that they had been put into a bid document.  Others have not signed a contract and have had no involvement with the WP.  Grayling had said that he would crack down on this, but now says that he hasn't received a single complaint about it. 

The Financial Times revealed the other day that the DWP has contingency plans in case A4e is stripped of its contracts.

Wednesday, 28 March 2012

Attack and defence

Our attention was drawn (thanks, Solomon) to a post on the businesszone site which has the quote of the week from Peter Holbrook, chief executive of Social Enterprise UK:  "Speaking at the opening of Social Enterprise Exchange in Glasgow, he went on to say that at a recent event, his chair, Claire Dove, 'almost decked' Emma Harrison, the 'infamous' founder of A4e."  He also said that A4e was about "pure profiteering and greed".  Holbrook's organisation is not alone in distancing itself from A4e.  It defines a social enterprise in the usual way, and specifically excludes any company which exists to make profits for shareholders or to "make its owners very wealthy".  Not so an organisation called ClearlySo, which says that it "connect(s) social enterprises with investors & the corporate world".  Their definition of a social enterprise is so elastic that they talk loosely of a "social business" which aims "to do good by doing well" (which is an inversion of one of Emma Harrison's little sayings) and A4e qualified to be in their directory.   The recent scandal got them seriously debating whether the company ought to stay in it, and now they've decided that it shouldn't.  The logic of their reasoning is beyond me.

Among those who really don't like A4e and all it represents are a lot of "voluntary sector" organisations.  This is another area where definitions are a bit blurred.  But on the Third Sector website someone called Debra Allcock Tyler tells us that "Charities should be running services because they care for people, not profit."  On the subject of the A4e scandal, she says: "I've been particularly amused by the moral outrage expressed by some of our politicians about the size of the salaries and bonuses paid to its directors."  Why should they be surprised when that's what businesses are for?  But her conclusion is that all the contracts should be given to charities.  "Our sector isn't in it for the money. We will do whatever it takes to continue to serve our beneficiaries, none of the money given to us will be distributed in profits and we do not walk away when the money dries up. So for me it's a no-brainer. Use charities to deliver services to vulnerable people."  I disagree.  The answer is a public sector which is properly valued, and actually pays people to do the front line work rather than just the management.

A4e, of course, are fighting back, with yet more PR.  They have now engaged "support from the Conservative Party's former campaign director", according to PRWeek.  "A small number of senior employees at Quiller Consultants, led by George Bridges, are working on what sources have described as a ‘crisis comms brief’......... A senior public affairs figure commented: ‘Bridges has very senior connections, and his crisis management role will be to help A4e get through its present mess.’"  Those "very senior connections" again; Bridges apparently ran George Osborne's 2010 election campaign.  But will they pull A4e out of the mess?  The company already employs at least 4 PR companies and has recently worked with another three.  Is the current need really for friends in high places?


Friday, 23 March 2012

The future of A4e depends .....

All the newspapers have reported the revelations from the BBC yesterday.  The coverage ranges from the Daily Mail's usual strident reporting, complete with graphics, to the more sober account in the Telegraph, which quotes an A4e spkesperson: "While this investigation uncovered a number of areas where procedures may have been lacking, the final audit and further investigation determined that five claims were irregular and related to one former employee.  This was reported to the DWP Risk Assurance Division, which confirmed that the action taken by A4e fully met their own audit requirements and that they considered the matter satisfactorily resolved.  A4e repaid the value of these three claims in full, which totalled less than £5,000.”  
The Yorkshire Post has the full quote from the DWP: "A 2009 A4e internal audit and risk document, relating to programmes contracted by the previous government, has today been passed to the department.  The Work and Pensions Select Committee was made aware of this audit at the time and the department later received assurances from A4e that it had not uncovered any major issues."  [my italics]
Paul Mason picked up this point on Newsnight tonight.  He said the DWP is now certain that it never received the report.  Yet weeks ago it asked for all the relevant information.  The report was made public in October 2009.  (I'm not sure what he meant by this.  Presumably it wasn't this leaked draft which was made public.)  So what did the DWP get, Mason asked.  
A4e says that they reported to the DWP the results of a final audit and further investigations.  The DWP says they only got the document yesterday. So was the version of the original audit report which was given to the DWP devoid of all the damning findings and warnings?  Did it amount to a cover-up? 
Mason ended by saying that the future of A4e depends on what was actually submitted in 2009.

Thursday, 22 March 2012

Is this the end? Newsnight revelations

When Newsnight devotes nearly 20 minutes to the story you know it's serious.
We got a trailer in the news; and the Guardian published the details earlier tonight.  But the piece on Newsnight was pretty devastating.  A report has been leaked, an internal A4e audit, which found evidence of widespread fraud and irregularity.  Numerous job outcome claims could not be backed up by evidence.  If this was systemic management failure, asked Paul Mason, why have A4e still got contracts?  We were shown David Cameron at an A4e office and told that A4e are paid £170m a year.  Then we were told that 224 client  records were examined from 20 of the company's top performers.  4% of the claims were described as potentially fraudulent and 12% as risky.  These cases come from all over the country.  Employers complained of being given blank forms to sign.
A4e were said to be playing it down and wouldn't be interviewed.  Kirsty McHugh of the ERSA (the industry trade body) said that appropriate action had been taken.  But the DWP never saw the document.  Why not?  And what did A4e do about it?  Mason said that there were questions for the politicians.  The government has a duty of care to the unemployed who are being sent to A4e.  No one from the DWP would be interviewed.
That gave free rein to Margaret Hodge, who talked of a "shocking catalogue of incidents" and fraud being "erndemic in the company".  Any manager of moral integrity would have shared this evidence with the DWP.  Hodge is sure that it's a systemic issue throughout the company.  She has had over a hundred emails on the matter.  The company has been greedy, she said, and she wants their contracts suspended.  people will lose trust in the system as a whole.  She rejects the idea that this was all in the past and couldn't happen now.  She believes that the culture in A4e hasn't changed, and they are not an appropriate company to be getting all that money.
Liam Byrne was also interviewed.  He wants to know if ministers knew about this when A4e got the Work Programme contracts, and what checks are now in place.
The government is now in a difficult position.  Trying to bluff this out, when even the BBC have got their teeth into it, makes them look complicit in fraud.  But pulling the plug would be very messy.
If I had to bet on it?  I think it's the end for A4e.

Stop press - Newsnight tonight

We've just heard that Newsnight (BBC2, 10.30) has a special report tonight, 22 March, on A4e.  They have a leaked report, A4e's own audit, from 2009, which suggests widespread potential fraud.  Paul Mason says that it reveals that A4e knew that its controls were "minimal".  It surveyed only the top 20 recruiters in the company, and found that 8% of the outcome claims were potentially fraudulent and only 70% could be verified.  Employers say that they were asked to sign blank forms.  Two of those staff named are still working for A4e.
This could be dynamite!

Wednesday, 21 March 2012

Half a page in Private Eye

Yes, the latest edition of Private Eye devotes half a page to the continuing saga of A4e.  While there's nothing new, there are some interesting elaborations on what we already know.
There has been speculation that the system of giving bonuses to staff who get somebody into a job fuelled the temptation to cut corners and even commit fraud.  A4e actually admitted to MPs that the practice "may have been a driver for individual malpractice".  But Rob Murdoch said that he thought the problem had been solved by moving to group bonuses.  I doubt it.  It doesn't cure the culture of relentless pressure to reach targets and make money.  As we have said, A4e isn't the only company to use bonuses for job outcomes, but it seems to be the only one in which the practice has resulted in scandal.
The article cites what happened in Edinburgh over local claimants' battle to be represented by a support group known as ECAP.  This is something we reported on in the past.  Two people were "sanctioned" simply because they insisted on having an ECAP member with them at interviews with A4e.  Both won their cases at tribunal.
Finally the writer turns to the two new contracts for prison education, provisionally awarded to A4e.  He reports that the two most recent Ofsted inspections of A4e's prison contracts were pretty damning and wonders how they could be given new ones.

I'm sad to see that the owner of a blog which has been tireless in its criticism of the treatment of the unemployed has decided to wage war on Watching A4e.  His conclusions are bizarre, and I won't waste time trying to answer them.  I don't suppose it will help to say that we are both on the same side, although our approaches are different.

There seems to have been a hiccup in the comments notification recently, so apologies to anyone who left a reasonable comment which was published late or not at all.  

A4e, and voluntary work experience - the facts?

A4e has published another piece on its own website which it says is "the facts behind the coverage".  It was probably a press release, but the press haven't taken it up.  It includes statements which are more spin than substance.  For instance, A4e "outperformed the market average in meeting performance targets on: New Deal for Disabled People; Pathways to Work; and Flexible New Deal in each of the geographical regions in which we operated with the exception of London."  (my italics)  It didn't meet performance targets.  Nobody did.  They even say, further down, "No provider met the bid targets."  So they can't even say, "We did better than most of the others" without putting a misleading spin on it.  
Then there's the statement, "For every £1 spent by the Government on our Work Programme services, we deliver back £1.95 in revenue to the taxpayer."  It's in bold, so important.  But what does it mean?  There are no meaningful results yet on which to base it.
The piece moves on to the "current allegations" and states: "Between 2006 and 2009, there were 14 prosecutions for fraud among all welfare to work providers working with DWP. Out of these 14 cases, only the one mentioned above, in May 2008, concerned A4e."  (That's the Slough case.)  They have a point here.  A4e has been singled out somewhat unfairly.
They then re-state their position on their review of controls and procedures, governance and "erroneous reports".  They tell us again that "Emma Harrison has resigned as a Director and Chairman of A4e. As a result, she no longer participates in Board meetings."  But what they don't address is the one fact which brought this storm on them - Emma's millions.

On Tuesday the Guardian published an important article headlined " Jobseekers who shunned voluntary scheme forced to do unpaid work".  It shows that people who have opted out of the voluntary scheme have been put on the mandatory programme in what seems to them to be retaliation.  The paper has evidence to back this, and says: "Guidance given to Jobcentre staff on mandatory work and obtained through freedom of information requests says advisers may, at their discretion, use dropping out or refusing to participate in voluntary schemes as grounds for MWA.  A claimant 'dropping-out' of an employment measure prematurely may, or may not, indicate a lack of focus and discipline on their part.  It is for advisory teams to consider the merits of MWA referral on a case-by-case basis."  The DWP's response is to waffle without denying the facts.  Well worth a read.

Tuesday, 20 March 2012

Emma's tax; and Grayling's annoyance

Emma Harrison, A4's former chairman, seems to have become a classic example of the rich avoiding tax, at least according to Channel 4 News.  They point out that there was a lag between the introduction of the 50p tax rate and it coming into force, and this enabled Harrison and others to receive huge dividend payouts at the lower rate.  There's confusion in the article about how much that payout was; at one point they talk about £7m and at another £8.5m.  But they reckon that "because of the way dividend income is tax, this saved Emma Harrison £803,000 in tax on her share."  It was legitimate, of course.  The article is meant to show how any calculations about the take from the 50p rate are flawed.

Chris Grayling appeared in front of the Work and Pensions Select Committee yesterday.  The only account I can find is that on the BBC news site, and that may be the reason that it focusses on Grayling's annoyance with the BBC for what he perceives as its lazy reporting of the Work Experience fiasco.  "I think the Guardian newspaper got things wrong, but the BBC had more of a duty to get things right and I don't think it made an effort to do so. At the end of the day all of this created a situation where we could have lost something that was making a real difference to young people and I think that was reprehensible."  He particularly hated the use of the word "workfare" because, according to him, it isn't.  But he did acknowledge that the Work Programme will not work as well as they had hoped. "The hard reality is we won't get everyone into work. We won't be able to do something for everyone. We have to be realistic. Some people will be disappointed."

Saturday, 17 March 2012

The debate which isn't happening

A story that made the mainstream media the other day is about a company called ALS and the contract it has to provide interpreting services to courts.  Nothing to do with A4e, you might say, but bear with me.  ALS has made a pig's ear of the contract.  Interpreters are refusing to work for them and people like judges and magistrates are very cross about it.  The minister responsible, Crispin Blunt, was interviewed on the Today programme, and Evan Davies asked him, several times, "Did you pick the cheapest bidder?"  Blunt was reluctant to answer, but eventually muttered that ALS had been the only company which could bid.
Blunt's admission is confirmation, if we needed it, that privatisation has been conducted as a cosy arrangement between governments and a very small number of private businesses.  Some years ago a Labour minister was questioned about another failed IT project.  Why had it been given to a company which had messed up several previous such contracts?  He admitted that it was the only company in a position to bid.
When the government decides to hand a service over to the private sector it often does so in discussion with the businesses likely to profit.  Initially there may be several companies and organisations willing to bid.  But it's an expensive process.  And when they see that one company is the chosen one, getting all the contracts for reasons they can't fathom, they drop out, and may well go out of business.  When A4e started scooping up all the contracts, the competition fell by the wayside, so that A4e, with its army of bid-writers, reigned supreme.  We heard recently about a council, Devon, which is outsourcing its core children's health services.  Local charities including Barnardo's, along with the local NHS trust have put in bids, but the contract is likely to go to either Serco or another private company, Virgin Health.
It soon becomes obvious that contracts are being designed in collaboration with the companies which will benefit from them.  Whether this happened with privatised New Deal we can't be sure, but it was certainly the case with FND.  The Work Programme shows how helpless government then becomes to oppose the companies.  Only the big companies could bid.  It was supposed to be strictly payment by results but isn't; an "attachment fee" was negotiated by the companies.  But you won't hear about that from ministers.  The extreme case is that of A4e getting the contract to design future contracts for which A4e can bid.  A single company can secure a monopoly in a particular niche.  A4e's involvement with direct payments for social care quickly became such a monopoly.  If a local council decides to outsource this service there is nowhere else to go.  A procurement process which states that past performance can't be taken into account enables the companies to bodge one contract after another.
Those business leaders who are making the most money from outsourcing are very close to government.  Most of the time the public know nothing about this, so Emma Harrison has done us a service by showing just how dangerous this can be.  
Naturally this view is not shared by everyone.  It has been difficult in recent weeks to find apologists for A4e, but one shows how a narrow perspective ignores the bigger picture.  It comes from an organisation called Arrival Education, a social enterprise which is sub-contracted to A4e on the Work Programme.  The author accuses the rest of us of "binary thinking", seeing the world only in black and white.  He (if it is a "he") is clever enough to see the nuances.  And so we have been grossly unfair to A4e, guilty of hatred and bile and making A4e into a pantomime villain.  It gets even more sanctimonious thereafter.  He defends A4e because the allegations relate to individuals, not to the company.  He's not that keen on Harrison herself but tells us all to grow up.  This is clearly someone who has no knowledge of the history which underlies the current situation.
A more thoughtful contribution comes from the Institute of Economic Affairs, one of those "think tanks" which provide cover for politicians.  It argues that the scandal surrounding A4e does not in any way invalidate the marketisation of public services.  And A4e is not, in welfare-to-work, a "market actor" because it is commissioned and paid by government.  The piece concludes that local commissioning and funding would be better.
There is no sign of the debate which really needs to take place.  Do we want the country run by a combination of Serco, Capita and G4S, with A4e a junior partner? 

Thursday, 15 March 2012

Counting the cost

Yesterday John McDonnell MP asked a very pertinent question of the Secretary of State for Work and Pensions - and got an answer!  McDonnell asked "what the value was of contracts given by his Department to A4e in each year from 2007 to 2011."  Chris Grayling told him that details of the contracts awarded to A4e during 2007 and 2008 were not held centrally (why not?) and it would cost too much to get the information.  But he listed the value from 2009.  (You can see it on TheyWorkforYou

Flexible New Deal contracts added up to £157,500,000.  MWA comes to £2,656,013.  Jobcentre Plus Support contracts (6 of them) add up to £66,470,115.  All of which adds up to £226,626,128.  And that's without the Work Programme contracts, which "depend on company performance".  It's also just contracts from the DWP.
Did we get our money's worth?

Wednesday, 14 March 2012

PMQs again

Fiona Mactaggart MP had another go at A4e today, raising at Prime Minister's Questions the subject of A4e's two new contracts.  She said that she has received "40 or 50" emails from members of the public alleging fraud by the company, so why had they been given these contracts.  Nick Clegg (it was the deputies doing PMQs today) said the only thing he could say, that an audit has been launched and any evidence of systematic fraud would put an end to all the contracts.
I wonder what Ms Mactaggart has done with all those emails.  Have they been passed to the DWP?

Those two new contracts

The Mail has reacted to the news of the two prison education contracts awarded to A4e ("worth up to £30m") with its usual stridency.  How can they do that when the company is being investigated for fraud and the DWP has launched its own enquiry?  They choose to ignore the SFA's decision to conduct an audit before the contracts are finalised.  But I suppose that would complicate the story.  The decision has "provoked anger"; from Margaret Hodge, who said it was astounding, and from an unnamed, and possibly apocryphal, rival bidder who said: "It seems deeply ironic that offenders are to be given lessons in getting back on the straight and narrow by a firm that is being investigated for fraud."
The article doesn't go into how any government department or agency could legally block A4e from getting contracts at this stage.  The bids for OLASS went in and were accepted before the storm broke.  The procurement process, ridiculously, doesn't allow a company's past record to be taken into account.  The only way A4e, or any company, could be barred would be if "systemic" fraud was found - and most of us are agreed that it won't be.  
PS.  Yesterday, we read on the TheyWorkForYou website, an MP, Andy Slaughter, asked the Secretary of State for Business Innovation and Skills " whether the tendering process for the OLASS4 contract was undertaken while A4e were under investigation by (a) the Department of Work and Pensions, (b) the Serious Fraud Office, (c) the police and (d) other public bodies."  John Hayes MP replied: "Under the Apprenticeships, Skills, Children and Learning Act 2009, decisions about the awarding of contracts are for the chief executive of Skills Funding to make.  In respect of the OLASS4 procurement process, the chief executive is undertaking a procurement process in line with the EU Procurement and EU Remedies Directives. That process is still under way and will not conclude until May 2012 at the earliest.  As part of this procurement, the chief executive of Skills Funding has made clear to A4e that he must have the results of the independent review of audit and control procedures A4e is undertaking into its own operations, and the results of the Department for Work and Pensions' investigation, before any formal contract with A4e is entered into." 

Tuesday, 13 March 2012

Where do we go from here?

Last Thursday Liam Byrne asked Chris Grayling "if he will publish all (a) internal correspondence of his Department and (b) correspondence with other Departments relating to the allegations of fraud at A4e."  The answer was: "The Department cannot publish information relating to the current allegations of fraud as this is a police matter and investigations are ongoing. "  Which is very convenient.  The police investigation into one local incident, along with the DWP's investigation into "all relationships" with A4e would appear to close down all discussion of the subject for the foreseeable future.  And now we learn that the Skills Funding Agency is conducting its own review of contracts with A4e for prison education.  The SFA said: "The Agency has decided that Agency auditors will work alongside A4e’s auditors to complete this exercise and provide additional assurance to the Agency that contracts are being delivered in accordance with our requirements.  In the current context the Skills Funding Agency is vigilant and continues to monitor the situation very closely.”  Good.  But again, this seems to put on hold the airing of concerns.  All those MPs who received evidence and complaints from clients and staff of the company will have handed their dossiers to the DWP.  And what of the journalists who were eagerly soliciting stories?  Has the official investigation closed down their interest?  Are editors afraid that publication could be seen to prejudice the process?  Or have they just got bored with the subject?
Maybe they are right.  Critics of A4e could scarcely have asked for more than has happened lately.  So should we take a step back, shut up for a bit, and wait for the results of the investigations?  There shouldn't be too long to wait.  The SFA needs to get the new contracts up and running.  And the DWP can't afford to let this drag on until the WP figures have to be published.  For the government this is about damage limitation, and we would be very surprised if any drastic action resulted.  So what now?

Saturday, 10 March 2012

"All relationships" - and new contracts

It must be serious, it was covered by the BBC.  The new fraud allegations and the DWP's investigation were reported, albeit briefly, on Newsnight.  Paul Mason put a slightly different spin on it.  As the Guardian reported, the government has launched an audit of 10 other A4e contracts.  Mason takes that to mean that it will ask why A4e was given so many contracts; but I doubt that.  It would have to go back ten years to be credible.
Most of the media add little to the press releases of the DWP and A4e.  The Huffington Post carries the reaction of union leader Mark Serwotka.  The Guardian gets someone to explain how the MWA fraud might have come about.  The Mail is remarkably restrained.
At the same time as all this bad publicity, there is good news for A4e.  As reported on FE Week, it is the "preferred bidder" for 2 of the 9 prison education contracts announced by the Skills Funding Agency.  The SFA is keen to make clear that this doesn't mean that the contracts are signed.  There's a "due diligence" stage to go through before they are finalised in the early summer.  But this will be the acid test of the government's seriousness.  I have had to delete comments from people who know, and are concerned about, A4e's role in OLASS, but some of them may now make themselves known to journalists.
A4e has announced that its new non-executive Chairman is Sir Robin Young.  He was a career civil servant before retiring to directorships, and became a member of A4e's board in 2007.  He begins his statement with the words "A4e's role is to improve people's lives".
Back to the investigation.  The government has said that A4e could have its contracts suspended if it is found guilty of "systemic fraud".  It's that word "systemic" which could prove the get-out for A4e.  It seems likely that the instances of fraud are the result of two factors; the intense pressure in the company to meet targets and make the money, with bonuses for outcomes, team prizes etc.; and a large proportion of inexperienced, minimally trained staff.  But if that is the case, should it let A4e off the hook?

Friday, 9 March 2012

New investigation

The Guardian has just reported that A4e faces a new fraud investigation.  It relates to a Mandatory Work Activity contract.  "A statement said: 'As a result of this new allegation, DWP has immediately commenced its own independent audit of all our commercial relationships with A4e.  We have required A4e to make available all documentation which our auditors may require and provide full access to interview any A4e employees. This is separate from the independent review of internal controls which A4e has previously announced.  The chief executive of A4e was informed of this at a meeting with a senior DWP official earlier today.  We have made it absolutely clear to A4e that we take this matter very seriously, and that if, at any point during the audit or thereafter, we find evidence of systemic fraud in DWP's contracts with A4e, we will not hesitate to immediately terminate our commercial relationship.' "
Serious stuff. 

Thursday, 8 March 2012

Whistles blowing an uncertain sound

The Mail has waded in again today with its own whistle-blower revelations.  But the piece shows the danger of not having done your research.
They focus on A4e's Edinburgh office.  This is interesting because we have received a number of complaints about events there.  But the "former team manager", Amy Rae, tells us that all the blame lies with A4e.  Faced with an inspection they had to fake courses, because there was no money for real ones.  Then the specific allegations begin.  "‘People would be found a job on a construction site that only lasted a day,’ she says, ‘and that was enough to claim the money. It was easy because there was just a tick-box on the form to say the job was “expected to last at least 13 weeks”, but often labourers were being put out of work again after 24 hours.’"  As we've pointed out before, this was perfectly okay in the terms of the contracts.  And it was more often the case that a client would start a job and disappear after a day or a shift, thinking that now the JC would be off his back.  
We are then told that "In the A4e office in Bradford, one whistleblower alleged staff went to Staples, the stationery store, to buy ‘make-your-own’ stamp kits to use on paperwork staff filled out if they found someone a job."  The Mail makes much of these rubber stamps, but again there is not necessarily fraud here.  The forms produced by the DWP required either a company stamp or a piece of headed notepaper.  Many small employers had neither.  It was not uncommon for providers to make a rubber stamp, with the full agreement of the employer.  Towards the end of the article A4e is quoted explaining this.  But it's a very different matter from the next allegation: "Some employers’ signatures were allegedly faked electronically, using a scanner to copy a signature off one sheet and print it on to another. On other occasions, signatures of employers were allegedly copied by hand from the signing-in book at reception."  That's fraud, straightforwardly.  
In Newcastle, we're told, employees had to take basic literacy and numeracy papers to fill the targets A4e had to meet for these tests.  The whistle-blower there talks about the appalling conditions the clients there had to endure.  There are frequent allegations of forged timesheets, according to the Mail.  As we've said before, this is often an indication of incompetent admin rather than deliberate fraud, but it's surprising that it was so widespread.
The Edinburgh woman also talks about the rewards and prizes on offer for meeting targets, including an invitation to tea at Emma Harrison's mansion.
The Mail has, naturally, been more strident than the Guardian in its whistle-blowing.  And there are probably more journalists out there busily compiling similar allegations.  We have to welcome that.  But there is a need to separate what went on under the old privatised contracts from what is happening under the Work Programme.  The old contracts were deeply flawed, and the DWP is to blame for that.  Some providers obviously stepped over the line separating expediency from fraud.  A4e's focus on the bottom line drove people to dishonesty.  Is it still going on?

Wednesday, 7 March 2012

The sound of whistles blowing

The Guardian has a number of stories about A4e today.  But first, a story in the Financial Times.  David Cameron has admitted that there have been a total of 125 investigations into welfare-to-work companies in the last 6 years (that is, since privatisation of the contracts).  Eleven of these concerned A4e.  So there has been a lot of dodgy practice going on throughout the industry.
The first of the 3 Guardian stories comes from "several former managers" and concerns what the headine calls the "champagne culture" at A4e.  It's about junketing by Emma Harrison and A4e managers, with expensive foreign travel.  But the article goes on to revelations by an unemployed man who, ironically, had been a Jobcentre employee.  As a client of A4e he was given a 4-week work placement in A4e's own finance department.  There he processed expenses claims, some of them lavish and not backed up by receipts, something he was told not to bother about.  A4e's reaction is what you would expect from any company in this situation.
The second piece is a description by a client, Stuart Webb, of his experience of the Work Programme in Lincoln.  This will chime with many clients, and not just of A4e.  He was simply told to sit in front of a computer, find vacancies and apply for them.  For this, A4e got the £400 attachment fee.  There was, he said, no personalised assistance, and twice appointments were cancelled when he got there, wasting his time and money.  The good news is that he found himself a job, but it galls him that A4e get money for this.  Webb runs into the same difficulty as other discontented clients; it's his word against the company's.  "A4e said that some of his comments about Job Search sessions were 'entirely subjective', and that advisers are always available to 'support individuals' as well as helping them 'structure their job search'.  They said their 'staff are always 'bothered',  and that Webb's view of his adviser was 'disingenuous'. They also refuted the claim that A4e gave him no help. One of its staff had informed Webb of the vacancy that led to his new job, the firm claimed."  Let's be clear, this isn't a new situation.  Many, many clients through the years have felt that it was unjust that the contractor should get paid for a job outcome that was none of their doing.
The third piece concerns fraud by a single employee.  A4e was working with vulnerable youngsters on Teesside on a local council project funded by European money in 2009.  But one A4e employee crudely forged signatures to make the figures look better.  A4e had to withdraw from that part of the project.
No doubt this drip of revelations will go on.  Not all of them will be valid.  And unemployed clients will face the problem that their perceptions are easily deniable. 

PS.  Some readers helpfully send me lots of links to stories.  Thanks, but there's no need.  Google alerts are very useful.  

Tuesday, 6 March 2012

Unanswered questions

Two Labour MPs have tried asking questions about A4e but have not received answers.
The first is Liam Byrne.  Yesterday he put in a written question to Francis Maude, Cabinet Office Minister, asking "when allegations of fraud at A4e were drawn to the attention of his Department's Propriety and Ethics team.  The answer was: "As has long been the practice, information relating to internal discussion and advice is not normally disclosed."  No joy there, then, but I don't suppose Byrne expected anything else.
Last Tuesday Fiona Mactaggart asked "the Secretary of State for Justice what contracts his Department has with A4e; and what the (a) purpose and (b) value is of each such contract."  Now, you would have thought that was straightforward.  But Kenneth Clarke replied: "The Ministry of Justice has no current contracts with A4e. However other departments do have contracts with A4e that deliver services to offenders."  What Mactaggart probably had in mind were the contracts for prison education, known as OLASS (Offender Learning and Skills Service).  Helpfully, back in 2008 A4e submitted a memorandum to the Public Accounts Committee trumpeting its involvement in these contracts.  On their own website A4e talk about working in 20 prisons with 400 staff on OLASS and providing careers guidance in 7 prisons.  It's big business.  And apparently these contracts don't come from the Ministry of Justice.  So, do they come from the Department for Education?  It would seem so. 
If even MPs have trouble getting information, no wonder the rest of us struggle.

Monday, 5 March 2012

That document

Last week a set of data was broadcast round the internet.  It seemed to show some performance stats for a whole lot of A4e's "partners" on the Work Programme.  I had a look, decided it was very difficult to interpret and not very relevant anyway.  But now Left Foot Forward have got hold of it and have asked A4e about it. The interpretation Left Foot Forward puts on it is that fewer than 10% of clients have found jobs, and fewer than 2% have held on to the job for 26 weeks.  A4e says that the data "was drawn from a test website which is confidential and protected" and "was obtained from a password-protected secure site", so it's not clear how it got out.  A4e threatens legal action "should you publish this data or make any of the inferences set out."  Left Foot Forward couldn't get any further clarification of what law A4e intended to use.  I remain dubious about the value of these figures.
It's timely that Richard Johnson, who used to be head of welfare-to-work for Serco, has written about the need for absolute openness in the WP performance figures.  He talks about the PAC's questions about money being creamed off by providers.  "One provider, in particular, appeared to be behaving like the fattest of cats, pouring many millions of dividend cream into her own bowl."  And he wants an independent regulator.  It's an interesting read, even though I don't agree with his conclusions.

Sunday, 4 March 2012

Keep Calm and Carry On

The Independent on Sunday is the only paper today keeping the story going.  "Further No. 10 link to A4e" says the headline, linking the departure of Cameron's advisor Steve Hilton with the appointment of Harrison as "families champion".  Hilton recommended her, they say.  And they describe the £250k contract given to A4e last September.  "A4e is advising No 10 on the next wave of privatisation. It will offer advice on "value for money" in contracting out, including writing guidelines on future privatisations. The firm will hold a seminar in Whitehall explaining how to design welfare contracts with private firms. .......... The Cabinet Office hired A4e to advise on four experimental schemes to help families with unemployed parents. All are in Conservative-led authorities: Hammersmith & Fulham, Westminster, Birmingham and Leicestershire.  A4e is not running the schemes, but is helping the Government write the rules on how they should work. They are based on social impact bonds, the Government's 'big idea' for privatising welfare. Investors and banks will pay private companies to help poor families. The taxpayer will then pay them back over years for the supposed 'savings'.  A4e is being asked to advise how to stop welfare firms taking money for poor performance. Yet A4e has often been found to be a poor performer itself."  
When A4e's main website went down recently there were some of us who felt that it was the result of a decision to revamp the site as part of an image makeover.  But no.  It's back, with no changes.  Even the link to "Emma's blog" is there on the home page, even though it hasn't been updated since last November.  Andrew Dutton has posted a response to the various accusations, and he ends with a note on "A4e and Emma Harrison".  "As a result of Emma Harrison’s resignation, announced on 24 February, she is no longer a Director or Chairman of A4e which means she cannot participate at Board meetings. The governance of A4e has therefore changed with immediate effect and decisions relating to future dividend policy will be determined by the Board under a new, independent non-executive Chairman. In addition, Emma’s salary as Chairman and Director and payments made by A4e in respect of Thornbridge Hall have ceased."  So who made the decisions about dividends before?  And that last bit about Thornbridge Hall is interesting.  The Board are really seeking to distance themselves from the woman who still owns most of the company.
But back to the websites.  The MyA4e site looks like something designed by professionals who have no clear idea of who their target audience is.  One could say the same about the multitude of other sites set up by A4e.  There's A4e Voicewhich is a blog for good news items.  The latest, posted on 2 March, is aimed at refuting the criticisms of A4e for using clients in work experience roles in its own company.  Then there's A4e Transitions which is an arm of the company which provides services to companies which are making lots of people redundant.  Very different is A4e Careers which apparently seeks to recruit people to work for the company.  It's a mess, with cartoons, handwriting-style fonts and all the familiar slogans.  Much more sober is the Direct payments for social care site.   Eleven local authorities contract with A4e to deliver this service.  Then there's A4e Skills which is "the direct delivery arm for vocational learning, delivering Apprenticeship programmes, work based learning (QCF & NVQ's), in-house training and vocationally related courses, accredited courses including e learning courses.  Most training takes place within the workplace, working flexibly to meet the needs of both organisations and individuals."  Finally there's A4e Insight,  their "research and consultancy arm".  This is where the line between private company and public sector becomes dangerously blurred.
I've almost certainly missed some of A4e's numerous websites.  But what they show is a confusion about image, despite the vast amounts of money A4e has spent on PR over the years.  Will the aim now be to shun the limelight, stop provoking the natural response to hype, and just buckle down to making money?  
By the way, Emma Harrison is a trustee of the Eden Project, which is currently having to lay off staff because of financial difficulties.

Friday, 2 March 2012

Plugging away

There's an interesting piece by Fiona MacTaggart MP on the Left Foot Forward website.  MacTaggart is the Labour MP for Slough, and a member of the Public Accounts Committee which tore into A4e recently.  She begins: "In politics often you plug away at an issue with no-one noticing, and then it becomes big news."  Yes, Fiona, I know the feeling.  She then says that over the last two years she has reported A4e to the National Auditor three times after complaints by constituents.  And it was in Slough that four former employees were arrested.  She outlines her concerns about the company:
  • It cut its costs and provided a poor service
  • It implied that it could offer skills training courses but failed to provide them
  • It used unemployed people in unpaid roles in the company, and didn't give a job to any of them
We have a right, she says, to expect high standards from A4e in return for their high profits.
All true.   But something else worries me.  MacTaggart certainly isn't the only MP who has had complaints about A4e (and, I'm sure, about other providers).  There are a number of things MPs can do with such complaints.  They can i) ignore them; ii) pass them on to the relevant minister; iii) pass them to a civil servant in the relevant department or iv) pass them to the National Auditor because money is involved.  Whatever the various MPs did, the DWP would have been well aware of an accumulation of complaints; but nothing was done.  Undoubtedly, bland responses were given, assurances offered.  It's pure luck that MacTaggart was tenacious and well-placed.  Could we now see some other MPs coming forward with their own dossiers of complaints - and the replies they received?

A flash in the pan?

The graph shows how the hits on this blog rose from the end of January, took off, soared and then gently settled down as the fall-out from the Public Accounts Committee meeting hit the headlines.  But the fuss dies down.  A4e and Emma Harrison are out of the news, and attention wanders away to other matters.  I'm sure that MPs Margaret Hodge and Fiona Mactaggart are still collecting stories, but they can't force an enquiry.  The government would just like to drop it now, and Labour, having garnered a bit of publicity for Liam Byrne, don't want to press too hard, because A4e's success is their responsibility.  Journalists are, no doubt, still collecting material, but they will drop the subject if it seems to be going stale.  You'll hear no more from the BBC.  Something worrying happened with the BBC, and we must be aware of it.  Emma Harrison had moved from being the owner of a business to being a celebrity.  There was a marked reluctance even to report the story, as if someone was ordering hands off.  It's unlikely that Harrison is the only person to have struck up a relationship with the Corporation which inhibits proper scrutiny.  But it means that people who had no particular interest in this subject are still almost completely unaware of what has happened. 
The Financial Times has kept on the case, reporting that DWP officials "told Number 10 that giving Ms Harrison a role advising the government on finding jobs for troubled families might cause ethical problems, given her company’s role as one of the main providers of the government’s £5bn back-to-work scheme."  But they didn't tell no. 10, because they couldn't see any reason to, that fraud investigations had been carried out into A4e.  They didn't see them as evidence of "systemic" fraud.  There is some minor fall-out around A4e's other contracts.  A4e has the contract to deliver "face-to-face" money advice, and the Money Advice Service has had to state that the current row has no bearing on this contract.  Glyndwr University, which had arranged to validate courses for A4e, has now said that it will keep the situation "under continual review". 
A4e has published (not necessarily deliberately?) its performance data for the Work Programme so far.  It's broken down by "partner" and difficult to analyse, but seems to show that on outcomes - sustained jobs so far - one organisation leads the pack.  It's too early to make much of this.  In the Autumn the DWP will have to publish figures across all the contracts.  Remember that the plan was to penalise the worst-performing provider in each area, but I wouldn't be surprised if that was dropped.
Emma Harrison has disappeared from Twitter, but Mark Lovell is still there (although he hasn't posted since 18 February).  
Has it been a flash in the pan?  Probably.