Catching up

Through the day it seems that Liam Byrne's intervention has paid off, in that it has forced an admission from the DWP, according to the Telegraph, that "No. 10 was not told about A4e fraud allegations".  A spokesman for the PM is quoted as saying, “I don’t think we were aware. But it’s a police investigation. If the police are investigating private sector companies, I don’t think necessarily they report regularly to the government on how their investigations are going.”

Richard Kay in the Mail asks, "Is David Cameron’s former ‘back-to-work tsar’ Emma Harrison already plotting her return?"  He tells us that Emma Harrison "has been approached by maintenance firm Aspect.co.uk to advise on a boot camp for jobless youths. Boss Nick Bizley says he is fed up with a deluge of job applications from foreigners but very few from young British candidates, and wants to change attitudes towards work."  Sadly, I can find nothing more on this.  
The most interesting article of the day is by John Harris in the Guardian.  It's always gratifying when the press catches up with what we've been going on about for ages.  He says that Emma Harrison's biggest mistake was "not keeping her head down".  He points out that she is not facing any reduction in her income and "may well be in line for a rather nice future: less heat and less work, but potentially even greater takings".  Then Harris contrasts Harrison's high profile with that of Chris Hyman, CEO of Serco, a company which has much more outsourcing business than A4e.  And he makes the leap which nobody on the supposed left of politics (certainly not Liam Byrne) has yet been willing to make.  "For decades now, the introduction of the profit motive into public services has been held to be synonymous with dynamism, innovation and increased responsiveness to the 'customer'. There is, of course, plenty of evidence to the contrary, but the more zealous minds one associates with the rule of New Labour still believe it, and most Conservatives hold it as an article of faith."  Quite.  And he concludes: "Do not rely on senior figures in the Labour party to make the running on this issue: after all, it built a huge share of the shadow state in which these people make their money. There again, if the progress of the Emma Harrison story – as with the recent controversy about workfare – is anything to go by, these things no longer need the involvement of front-rank politicians to build unstoppable momentum. One thing is certain: though long buried, the tension between public services and profit is back – and this story is only just starting."
I'm currently reading a book called The Verdict by Polly Toynbee and David Walker, summing up the Labour years from 1997 to 2010 from a Labour-supporting but critical point of view.  They manage to cover New Deal and the various measures to help the unemployed while totally ignoring the privatisation in 2006.  John Harris is right.  But I fear it may be too late.

Britain's Secret Fat Cats

I managed to watch this Channel 4 Dispatches programme on 4OD - or rather, the first two thirds of it. It seems that if you pause a programme on 4OD you can't restart it, but have to go back to the beginning. I saw enough to applaud this exposure of the reality of outsourcing.

It focussed on the three biggest companies, Serco, Capita and G4S. We were reminded that David Cameron called in these and other companies to renegotiate some contracts, but the big 3 are totally unconcerned about taking a small hit now, because there's so much business in the pipeline. They are all buoyant about the vast amounts they will make in the near future. Capita's Paul Pindar reckoned they had 30 contract opportunities, worth £4.7bn, and Serco has a £16.5bn order book. The reporter tried to get at the details of these contracts but was told by the government that they were commercially confidential - giving the lie to Cameron's promise of "transparency" in government contracts. Bear in mind in what follows that A4e are in a rather different category to these 3; it isn't a publicly listed company with shareholders, so we can't get at figures for executive pay. Last year Chris Hyman of Serco got £5m, Nick Buckles of G4S got £4m and, in 2008, Paul Pindar of Capita got £10m. And half or more of their business comes from the privatisation of the public sector. We were treated to a fascinating explanation of the self-serving system which results in obscene levels of executive pay. The tax-payer who provides the dosh for the pay of the execs of the outsourcing companies has no say in how much they should get.

The programme then turned to the Work Programme. It looked at Liverpool, where a small local outfit had used the Future Jobs Fund to secure work and / or training fpr more than 400 people. Despite Cameron's talk of the Big Society, power devolving to local people, this organisation and all those like it will not be in the running for contracts under the WP; but in the North West both Serco and G4S are on the shortlist. It was clear, we were told, that even if small, local organisations start out as players in the Big Society, they will soon be swallowed up by the big fish.

The Financial Times has maintained its interest in the finances of the Work Programme. On 8 March they reported that some of the larger providers were privately dubious about whether the payment by results system was going to stack up. They can't afford not to be in it, but they are banking on the fact that the government can't let it fall over and will bail them out if necessary. Yesterday they quoted Chris Grayling's response. No provider will have more than "a limited number of contracts", in order to spread the load if anyone goes bust. And, he said, the providers can make "shedloads" of money if they get the hardest to help into work.

All in all, quite depressing.

PS. Emma Harrison was speaking at a meeting of the Policy Exchange, a Tory think tank, today about Working Families Everywhere.