Saturday, 30 June 2012

They want more sanctions!

A fascinating piece in the Observer reports that "Private firms on payment-by-result contracts have suggested more punishments should have been meted out".  In 2009, 139,000 people had their incomes stopped.  By 2011 it was more than 500,000.  And yet Corporate Watch has documents which show that the companies want more.  In the first 8 months of the Work Programme, jobcentres stopped benefits for 40,000 people, but that was only about a third of the 110,000 that were referred to them.  The rate, however, is going up.  The document shows that Working Links refers the most cases, but A4e is second.  It requested sanctions in 10,120 cases.  3,000 of these were accepted by the jobcentres.  
The procedure in A4e's case, I'm told, is that offices send the cases of non-compliance through to a central office, along with the reasons for this non-compliance (didn't turn up but was in hospital, that kind of thing); that office then refers them for sanctions.  But regularly the explanations get left off, so people find their income has been stopped when they've been told that wouldn't happen.
The article goes on: Richard Whittell from Corporate Watch said the Work Programme appeared to be focused on slashing benefit rather than putting people into work. "These figures give the lie to the government's claims its welfare reforms are about helping people into work," he said.   " By the time it's finished, more people will have been sanctioned by the Work Programme than properly employed through it. Every month thousands of people are having their only source of income stopped and being pushed into hardship. Companies like Serco, Working Links and G4S may not be very good at finding people suitable work, but they're dab hands at punishing them." The private firms say they make their referrals to job centres in line with government guidelines.
Chris Grayling is quoted as saying that "there was no financial imperative for private firms to punish jobseekers".  So why are they doing it?  Is it the case that increasing numbers of people are refusing to comply with the terms of the WP?  Or is there some other reason?

Friday, 29 June 2012

More figures - and disagreement

As Channel 4 publishes more of the figures from that leaked report, so there is dispute about how meaningful they are.
The channel's news website details the outcome rates in different regions.  They are miserably low in some areas where the unemployment rate is also low; and better in areas where A4e are sub-contractors, suggesting to the writer that it's A4e's model which is at fault.  The reporter Jackie Long, on her Channel 4 blog, summarises this, and quotes the DWP's response that the interpretation of the stats was "ludicrous".  Long asks if A4e's figures would be better after 12 months instead of 10, and clearly doesn't think so.  
The Telegraph has carried the story, and expands on the DWP's response.  The spokes-person is quoted as saying that is "virtually impossible for any provider to have built up a significant number of job outcome payments by the end of March as most outcomes are only payable after someone has found a job and stayed in it for six months".  Hold on.  The stats revealed by Channel 4 are not about outcome payments.  They show the numbers of starters getting work and then staying in work for 13 weeks or more.  If they haven't been in a job for 13 weeks then they're not going to make it to 6 months.
Even more puzzling is the reaction of the FullFact website, which is normally very rigorous about stats.  They point to the premature judgement made by the Tories when in opposition on Flexible New Deal.  Figures show, they say, that "a significantly higher proportion of participants were finding sustainable work after 14 months than were after 11 months".  Well, if they say so.  We are to understand, then, that A4e's figures could look dramatically better in a few months' time.  

Thursday, 28 June 2012

Who cares about the 3.5%?

Only two papers have so far taken up the story of the figures revealed by Channel 4 News last night.  The Daily Mail has a ball with it, of course, but basically just repeats Channel 4's press release.  The Guardian is more restrained but adds nothing.  So does anyone care?

One point made by Channel 4 was that, in Newham at least, A4e does less well at getting people into work than the local council's own scheme.  I believe that this is true around the country.  Local authorities are funding their own programmes, out of very stretched budgets, often focussing on young unemployed people.  Why are they more successful than the private companies?  I suggest that it's because they are willing to fund the training and qualifications that are essential.  In a place like Newham, with the Olympic sites, there would have been jobs in construction and security.  For both of those industries you need the qualification.  Is A4e funding these?  It would be very interesting to compare local council schemes' success rates with those of companies like A4e all over the country.

The DWP's stated minimum sustained jobs rate, if providers are not to lose their contracts, is 5.5%.  This is pathetically low anyway, and if A4e can't even make that they obviously deserve to lose their contracts.  But Channel 4 suggested last night that if all the providers were in the same boat, perhaps the answer was to give them more money up front.  It isn't.  The answer is to admit defeat, end the contracts and give the money to local councils, which can work with the Jobcentres.

Just 3.5 per cent

Channel 4 News has just run an item revealing that A4e has managed only 3.5% job outcomes lasting 13 weeks or more.

They've got hold of figures which show that A4e are "improving the lives of very few".  Since June 2011 only 18% of starters got work, and only 3.5% got "sustained" work, i.e. lasting 13 weeks.  Margaret Hodge said it was "deeply depressing" - "an abysmal performance".  Philip Hammond, a correspondent to this blog who has been on the programme for 6 months, said in an interview that it did not offer real support and called the WP a scam.

The reporter pointed out that in Newham, East London, A4e's performance of 3% was worse than that of the local authority's own scheme.

Ian Mulheirn of the Social Market Foundation says that the figures are worse than the DWP's forecast for no intervention at all.  The DWP wouldn't comment, except to say that it would be "ludicrous" to talk about the figures now.  A4e doesn't dispute the figures but wouldn't be interviewed either.

The item ended with the comment that although A4e is falling way below minimum standards it's unlikely that they will lose their contracts.  It's critical to know how well or badly the other providers are doing.

Monday, 25 June 2012

Psychobabble - A4e and NLP

We reported A4e's use of Neuro Linguistic Programming (NLP) back in April, thanks to a tip from a reader.  Now the Financial Times has taken this up in an article today.  They describe the experience of an A4e client who was told to come in for a "course" and found himself, along with others, confronted by "a master practitioner" in NLP who was there "to change their mindsets".  It didn't impress the client in question, who found it "stupendously stupid" and resented being forced onto it.
The FT is delicate about the worth of NLP.  It links to an article on its own site from 2008 which is sceptical, but is reluctant to commit either way.  Much more helpful is an article in the Skeptic's Dictionary.  But what it comes down to is whether people should be forced onto something which they may well have a principled objection to.  The FT article isn't clear about whether the NLP courses are obligatory.  They are "part of a mutually agreed plan of activities", which suggests you can lose your income if you refuse.  And that is completely unacceptable.  The clients are apparently not told what the course is until they get there.  But even if they know, the vast majority will not have the information to make a decision about its value.  
"Motivational" courses are all the rage in business.  They cost huge amounts of money and are very profitable for those who run them.  NLP is different.  No one should be obliged to undertake it.
If you find yourself in the position of having to sit through this stuff, first ascertain whether it's compulsory.  Will you have your income stopped if you refuse?  If yes, you may want to consider getting legal advice, but you won't be able to at the time.  So if you are forced into it, detach yourself and approach it as an objective observer.  Make copious notes as soon as possible.
The FT article goes on to discuss the whole place of motivational and other therapies in W2W.  Their informant is in no doubt that it was bullying when what he needs is a job.  And it's significant that he insists on a pseudonym because "he was concerned about how A4e would react".

Sunday, 24 June 2012

War on the poor

If you're under 25 and unemployed you probably feel even more depressed and persecuted than usual today.  David Cameron feels the need to assert right-wing ideas, and that means a "welfare crackdown", with the young taking the brunt of it.  The report in the Telegraph says: "Ministers expect this 'next wave' of benefit cuts to include the axing of all housing benefit currently paid to around 380,000 people aged under 25. Such a move would force many to move back in with their parents rather than living independently."  
The Express says: "It could also mean stopping the £70-a-week dole payment for individuals who do not try hard enough to get work and forcing a hard core of unemployed to do community work after two years - or lose all their benefits."  Of course, that's just making the ritual noises to appease Tories, but it's another kick in the teeth for the unemployed.  Interestingly, the Express has another article entitled "Starving in Britain" which shows clearly the effect of cutting housing benefit, and the struggle of people, even those in work, to feed their children.
If you're not angry enough yet, read the piece in the Mail on Sunday based on an interview with the Dear Leader, from which all the other reports get their information.  The headline sets the tone: "Cameron to axe housing benefits for feckless under 25s as he declares war on welfare culture."
Figures in one city I know show that there are 44 unemployed people for every job vacancy.  Mandatory Work Activity (MWA) is already forcing people to do unpaid "community" work.  Under 25s already can only get housing benefit for shared housing.  Etc., etc.  There's no need to repeat it.  

Friday, 22 June 2012

It's not fair

A4e have a page on their website headed "The Facts Behind the Coverage" and they've recently updated it.  It's a valiant attempt to deal with what they see as misinformation, and some of it, we would have to concede, is justified.  Some of it, however, is open to debate.

They talk about their performance.  They have "outperformed the market average on meeting performance targets" on previous programmes.  Yes, but they nowhere near met those targets. The fact that nobody else did either doesn't help much.  As for the Work Programme, they are "operating in line with our expectations".  But we don't know what those expectations are.  On value for money they say, "For every £1 spent by the Government on our Work Programme services, we deliver back £1.95 in revenue to the taxpayer."  It's very difficult to see how they justify that statement, especially as they point to the payment by results model and say "we don’t get paid if we don’t succeed".  They actually get paid £400 for every starter, regardless of outcome.
Turning to the fraud allegations, they point out the "positive findings" of the investigation by the DWP and the SFA.  This is something which the public are not allowed to know about.  All those many people who put in FoI requests to see the results of this investigation were told that there were excellent reasons for refusing.  In talking about the Public Accounts Committee meeting in May they say that there were 6 whistle blowers.  They reiterate that "the majority of allegations made by Mr Hutchinson are unfounded and untrue", which is convenient since he's the only one who has been identified.  And I don't think they are taking him to court.  What about the other 5?  Were they lying too?

A4e, like all the providers, are keen to focus on the Work Programme and put the past behind them.  The WP has raised major issues about how clients (I refuse to call them "customers", as if they had purchasing options) are treated, but the black box model, and lack of inspection, mean that the companies are not held to account for this.  It's all hanging on the numbers - and we're not allowed to know about them yet.

Wednesday, 20 June 2012

Going up

The news today is that unemployment is slightly down but the number claiming benefits is up.  There's a good analysis in the Independent.  Not even Chris Grayling can see much encouragement in the figures.  And, unusually, he doesn't try to cite the Work Programme as the solution.   One of the union leaders, Dave Prentis, points out that, "The number of people unemployed for more than two years continues to rise. We know that the longer someone is out of work, the more difficult it is to get back into it."
 The BBC this morning (Today on R4) followed 8 people who were put out of work when a shop closed.  5 of them are still unemployed months later, and aware that time is running out for them.  What a pity that the crisis around A4e scuppered the BBC's plans to follow a number of clients at A4e's Liverpool office.  (See my 8 Feb post.)  It was a project which began in November 2011, but presumably had to be killed.  The fact is that the Work Programme isn't working.

Monday, 18 June 2012

Redefining failure

One of the great advantages to government of flogging off public services is that the politicians are then not accountable.  Information is refused because it is "commercially sensitive".  Even at local council level, the taxpayers and the service users (and even councillors) are told that the details of contracts are none of their business.  The debacle over A4e highlighted the problems with this situation.  But for this government the Work Programme leaves them nowhere to hide.

Iain Duncan Smith spent years in opposition developing his theories on welfare.  Being in government has brought him face to face with reality.  But he can't afford for his theories to be proved wrong.  So, along with the imperturbable Chris Grayling, he has to insist, against all the evidence, that the Work Programme is proving a rip-roaring success.  The government can't afford for it to fail; it is the model for all future privatisation.  And if that means redefining failure as success, they'll do it.  The contracts, we are told, are strictly "payment by results".  But that isn't true.  The companies insisted on "attachment fees", an upfront payment for each starter.  Someone on the MyLegal website has analysed the finances and shown that A4e must already have received £25.3 million in attachment fees alone.  And if they are achieving only 10% job outcomes they are likely to have been paid around £32.8 million for getting 6,300 people into work.  But the dead weight figure (those who would have got work without any intervention) is reckoned to be around 25%.  When the government is finally obliged to publish figures it will be interesting to see how they get round that.  Then there's the fact that the contracts were supposed to involve small, local and charity organisations; but 28 of these have already dropped out, unable to make it pay.

What does increased "Mandatory Work Activity" do to the availability of actual jobs?  Never mind, there are plenty of jobs out there.  IDS, Grayling and other ministers trot out figures for the number of vacancies which bear an increasingly tenuous relationship with reality.  On 14 June IDS claimed that 500,000 new jobs are being added to Jobcentres every week.  The FullFact website has shown that this is simply not true.  JCP reckons it's about 10,000 a day; but any jobseeker knows that this doesn't reflect genuine job vacancies.

So annoyed is Iain Duncan Smith by the refusal of the real world to conform to his theories that he is increasingly blaming the poor for their poverty.  There's nothing new in that for the right wing of politics.  

Wednesday, 13 June 2012

Mandatory Work Activity - a success?

There is plenty of comment on the news that the government plans to expand the Mandatory Work Activity scheme.  If you haven't read any of it, try the Guardian.  Essentially, the plan was was for 10,000 starts in the first year, but more than 49,000 have been referred in the first 10 months.  Only 16,790 have actually started MWA.  And 46% either signed off or didn't turn up.  (I don't know how they work that out - I make that 34% no-show.)  It's such a success that they are going to spend £5m on increasing the numbers by 9,000.  And the penalty for failing to comply could be loss of benefits for 3 years.

For the right wing press, of course, this means that nearly half of long-term unemployed people are in some way fraudulent.  But does it?  Certainly there are some who are working in the black economy, cash in hand, and will sign off.  Some others are claiming whilst being kept by someone else, and would rather sign off than go on the scheme.  But nobody knows how many there are in these categories.  Some have been trying to play the system by signing off for a week or two then signing on again, assuming that the clock is wound back to the start - but it isn't.  Others will simply have decided that they don't wish to comply with MWA.  But what they will then live on, who knows?  There is no evidence of increased numbers getting jobs because of MWA.

MWA was the contract which A4e lost in one region, you remember, because their processes were too "risky".  But another £5m is to be put into the scheme.  Presumably if enough people sign off, that's a bargain.  But one question which is never addressed is, where is all this "work activity" coming from?  Which employers are benefiting from this?  There are now nearly 17,000 people out there working for up to 30 hours a week, doing what?

Sunday, 10 June 2012

That "unpaid stewards" row

There's been a great deal written about the case of the "work experience" jubilee stewards, but I haven't weighed in because it was nothing to do with A4e.  Well, not directly, anyway.
Among all the articles about the controversy I recommend two.  The first is a New Statesman blog piece, written by Kerry McCarthy.   The second is by John Harris in the Guardian, and is emotively titled "Back to the Workhouse".  

One thing struck me about the incident, which hasn't been raised in the media; the relationship of Work Programme providers with large companies.  In this case the provider was a subcontractor, a charity called Tomorrow's People, and the employer was Close Protection UK.  Now, in the past security work was an area for which some providers were willing to pay for training.  The SIA (the necessary qualification for the job) could be delivered in a week.  The provider might well have an arrangement with one or two local security firms for their clients to have interviews for any vacancies.  But now, it seems, the qualification involves unpaid "work experience" and an NVQ2 in something called spectator safety.  And the employer is a national company.  

This is far from unique.  A4e has a relationship with another huge security firm, Securitas, which boasts of employing 300,000 people in 51 countries.  Such arrangements are not widely publicised, but probably involve employers in areas like care work and retail, as well as security; jobs which need minimal training and pay minimum wage.  The WP provider pays for the training and the employer agrees to offer some jobs to the WP clients.  What's wrong with that?  Most people would say that anything which helps get people into work must be a good thing.  But there are some drawbacks.

For the employers it means a big taxpayer subsidy, because ultimately it's the taxpayer who is paying for the training.  Yet it's a private arrangement between two private companies.  It leaves smaller companies out of the loop.  True, the clients who get work are not bound to the first employer.  But they don't know, when put onto the programme, which companies have these arrangements with their provider, and so which areas of work they are going to be steered into.  No one is monitoring these relationships - that "black box" again.  They only get scrutinised when it goes wrong, as with CPUK.  There, it was apparent that the employer was benefiting from free labour called "work experience".  How many other employers are getting a similar benefit?

The government is determined to increase dramatically the number of people who are made to do unpaid "work experience".  We must demand full disclosure of which employers benefit from this.  How many people are they taking onto work experience and how many are they subsequently employing?

Friday, 8 June 2012

Shell game?

Is A4e unusual in having a maze of companies, most of which seem to serve no useful purpose?  
  • The parent company, the one we all think of as A4e, is A4e Ltd.
  • We looked at Action for Employment Trustees Ltd; directors Emma Harrison and Mark Lovell.  It's wholly owned by A4e Ltd and its purpose seems to be simply to hold shares in A4e Ltd - 7.1% of the total.
  • Then there's A4e Employee Trustee Ltd.  This was set up in March 2012 as All Employee Company Ltd, but changed its name in May of this year.  Its director is Steve Boyfield, one of A4e Ltd's directors.
  • A4e Fundraising Ltd was in existence from 2003 to 2009.
  • A4e Consult Ltd was set up in 2006 but has morphed into A4e Management Ltd.  Its directors are Andrew Dutton and Mark Lovell.  (Emma Harrison ceased to be a director in February this year.)  The company's 100 shares are all held by A4e Ltd.  Various directories give its purpose as career advice or the like.
  • Two other companies were set up in 2011.  They are A4e Europe Ltd and A4e Worldwide Ltd.  The sole director of both is Andrew Dutton.  A4e Europe's one share is held by A4e Worldwide.  A4e Worldwide's one share is held by A4e Ltd.
Some of these would appear to fit the definition of shell companies.  Perhaps this is normal practice.  Perhaps it makes perfect sense to a tax accountant.

Wednesday, 6 June 2012

Those other shareholders

At the Public Accounts Committee the DWP representative admitted that he didn't know who the other shareholders are.  Well, we can enlighten him.  According to the latest filed documentation, A4e Ltd has 5 ordinary shareholders listed.  They are:

  • Emma Harrison - 85.5%
  • Mark Lovell, chairman of A4e - 6.5%
  • Stephen Boyfield, non-exec director of A4e - 0.43%
  • Roy Newey, former director of A4e - 0.43%
  • Action for Employment Trustees Ltd. - 7.1%
The last company was formed in 2009 but was dormant in 2011.  It was then revived, and the latest returns show that it has two directors, Emma Harrison and Mark Lovell.  There is only one share, and that is held by A4e Ltd.

I am not qualified to work out what is going on here.

Sunday, 3 June 2012

Morale at an all-time low

It may be a holiday weekend, but for many A4e staff it's a gloomy one.  Some left work on Friday in the knowledge that the bonuses they expected to be paid this month have been cancelled.  Managers have been receiving up to 20% of their pay as financial performance bonuses for the previous year.  Last year's would have included 6 months of dual WP / FND work, and since FND was described by one employee as a "cash cow", the cancellation of the bonuses represents a significant loss.  They've also been told that anyone earning £26k pa or more will not be getting a pay increase.  Those earning less than £26k will get a 1% rise.  This comes on top of the news that Emma Harrison took £8.6 million out of the company last year.
Many staff report that they are unhappy for other reasons.  They were supposed to be dealing with caseloads of no more than 80, but some have upwards of 200 clients, so the amount of "tailored support" they can give is limited.  Tensions are high in some offices.  The system of referring people for "sanctions" (taking away their income) results in mistakes, and staff are having to confront some very angry clients.  
Staff turnover has always been high in A4e, and some say that it is only limited now by the lack of opportunity to move elsewhere.  But morale is reported to be at an all-time low.
(Don't bother posting comments attacking staff - they won't be published.)

This comes at a time when, as the Telegraph reports, the DWP has told Margaret Hodge, chair of the Public Accounts Committee, that it won't be publishing details of the 115 cases of potential fraud which don't involve A4e.  The "public interest" argument isn't strong enough, they say.