Tuesday, 28 April 2015

A4e sale - the reactions

Some more reactions have appeared on the sell-off of A4e.  Of the mainstream media, only the Financial Times reports it.  They say that Emma Harrison owned 87% of the company, whereas others say 85% and City AM says 85.5%.  All agree that she gets £20m out of the deal.  All the reports point out that Staffline already owns EOS and Avanta, and will now control a large chunk of the market; City AM says 23%.  The FT says: "The 16 private sector suppliers of the government’s welfare-to-work programme have been engaged in a wave of consolidation as they seek to bolster their position ahead of the next round of contracts in March 2017".  It also says that A4e employs 3,000 people, but the Yorkshire Post says the figure is 2,200.  The newly enlarged company will hold 9 WP contracts, two more than Ingeus (which is now owned by an American company).  No one seems to think this is a problem.
The financial websites naturally focus on the money.  Investor Interactive reports that Staffline's shares "shot up by 18%" on the announcement and is very chirpy about its future profitability.  The Yorkshire Post looks wider.  They do call Harrison an entrepreneur, which I have always maintained is untrue; and they quote the boss of Staffline on why the name A4e will not be retained, unlike that of Avanta.  He says that the A4e brand is "unfortunately too tarnished".  The paper also tries to get a comment from Emma Harrison herself; but when contacted all she would say was "I’m sure you’ve had all the press releases. Thanks for calling, bye."  Charmingly, they add "It is thought that she will devote her time to charity work."  


  1. All this consolidation within the W2W sector suggests that the only way to survive is to merge and become part of a bigger player. Economies of scale and all that.

    It also suggests that the entire WP is one giant oxymoron. £Billions spent on the one hand. And on the other players like Ingeus and A4e find it tougher to survive as stand alone firms in a 'payment by results' universe. Which further backs up the evidence that the WP is not getting anything like the results Smith would otherwise have us all believe.

  2. Sick of the Work Programme28 April 2015 at 04:32

    Rather frustrating to see coverage of this largely absent from mainstream media. There is fairly widespread awareness about the impact that government cuts have had on average families, yet how many people are aware that the government has at the same time blown £5bn on the Work Programme, which (contrary to what IDS likes to claim) has helped very few of its 'customers?' Call me cynical, but it almost seems that the mainstream media is now supporting the government by keeping this hushed up.

  3. "It is thought that she will devote her time to charity work."

    Somehow I don't think we'll see her working alongside the workfare conscripts at the local charity shop.

  4. Well looking at the exit polls, it looks like Cameron may just scrape in again. This is not good. The Tories kept banging on about the economy and it seems to have worked esp.as Labour are seen as weak on economics and are still blamed for the 2008 economic crash (even though it started on Wall Street and was a global crisis).

    As far as this blog is concerned, the question is will we still see the odious and frankly dangerous Smith still in his position in the coming days or will he be moved? And the Work Prog.? Univ. Credit? I guess they will stagger from one crisis to the next wasting ever more taxpayers cash.

    Perhaps the best we can hope for is that Cameron will not have a workable majority and will face tough times ahead. If things do not go well for him such as trying to avoid an EU referendum, his party is going to be split once again. And of course chancers such as Boris Johnson will be ready to plunge the dagger into Cameron's back. It could all even lead to another election in six months time.

  5. So it would appear that Esther McVey, Smith's loathsome former sidekick has lost her seat. I wonder who Cameron will appoint to serve under Smith? Makes little difference I guess. He or she will just be a nodding mouthpiece for ever more costly and failing policies backed by an ever more draconian benefits regime.

  6. The Tories have already frozen non-working benefits (probably indefinitely) so the only way they can cut the 'welfare' bill is by cutting benefits by people in work like child benefit/working tax credit. This will require a significant change in rhetoric as up to this point they have attacked benefits as being abused by the 'work-shy'. To then attack those in work could be seen as callous and in contradiction of their appeal to hardworking people.

    Although last nights result is disappointing for the left the Tories will do well to tread carefully. If they get too confident and attack those in work and on low incomes and interpret the result as a mandate to privatise the NHS etc they could lose support.

    The reason why the Tories won the election is no mystery. It can be explained by one reason and one alone - the inherent conservatism of the British. A too radical agenda will backfire. They will do well to take heed of McVey's loss.


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