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."  

BIG NEWS - A4E UP FOR SALE

This is the biggest news about A4e ever.  Read the full story here in the Financial Times.

"Emma Harrison, the prime minister’s former “families champion”, has appointed Deloitte to advise on a sale or break-up of the business, which has been struggling since being hit by a series of fraud claims."
Nobody is saying anything else very much, except that Harrison, with an 87% share in the company, is "weighing her options" and that various outfits might be interested in buying.

That's all we know for now, and it's late, so a more considered post tomorrow.

The sanctions report

Matthew Oakley's report is out.  You can read it here.  His brief was to look at how the sanctions system was working amongst certain groups; in particular at the communications with, and understanding by, claimants.  It was said from the beginning that the remit was far too narrow, a cosmetic exercise to justify the DWP but ignoring the real issues.  And it was said that Oakley was the wrong person to do it.  If you read the Foreword to the report you do get the impression that Oakley dutifully applauds the system.  But in fact he has gone beyond his brief, and there are some very important points in the document.
The Financial Times wrote a fair piece, highlighting the poor way in which the DWP communicates with claimants who have been sanctioned.  They also got a quote out of Esther McVey: "I have already started to make improvements ..."  Far be it from me to call anyone a liar, but I doubt that this is true.  The Guardian went with the fact that "Benefit sanctions hit most vulnerable people the hardest", sending out unintelligible letters, and not telling people about the availability of hardship payments unless they asked.  There's also a very significant observation from the report: "It also revealed serious flaws in how sanctions were imposed, with Work Programme providers required to send participants for sanctions when they knew they had done nothing wrong, leaving 'claimants … sent from pillar to post'".  This is the first time I've seen this fact in print.  The Guardian produced an update on this article this evening to take account of the fact that the government is to "overhaul the way it treats benefit recipients threatened by sanctions".  This must be based on the DWP's press release, which doesn't use the word overhaul and promises very little.  It does provide a quote from McVey which is probably made up by the DWP Press Office.  (You can play meaningless platitude bingo with it.)  The BBC website has a very careful piece which isn't worth reading.  And from Iain Duncan Smith, not a peep.  
This report is, of course, far from sufficient.  As the TUC has said, there must be a much wider review into the sanctions regime.  Perhaps it should look at this case reported today in a Hertfordshire local paper.  It's as bad as it gets.

Help to Work - at least for G4S

At last, we know four of the companies which have won the contracts to deliver the inappropriately named "Help to Work" programme.  The Financial Times reveals that they are G4S, Seetec, Interserve and Pertemps.  Why it hasn't named the other two, I have no idea, but A4e hasn't said anything, and Serco has launched a rescue rights issue, so perhaps they both lost out.  The FT says that G4S is the biggest winner.  It also says: "It comes less than three weeks after the British government lifted a ban on G4S bidding for public sector work and suggests that Whitehall is taking a favourable view towards one of its largest contractors, despite insisting that the company remains under close scrutiny."
But hang on a minute.  The bidding must have taken place during the time in which that ban was supposed to be in place.  And the company was "cleared" just in time for the announcement of its success.  Who is the government trying to kid?

The whole "Help to Work" story today has been utterly depressing.  This morning, on Radio 4's Today programme, Evan Davies had the dubious pleasure of trying to interview the appalling Esther McVey.  I bet he didn't want to.  When he tried to pose questions to her boss, Iain Duncan Smith, recently he ended up being complained about by ignorant listeners.  McVey did the same trick this morning - spouting utter twaddle and not answering questions.  The reaction to the new scheme in the media has been predictable.  The Guardian and the Independent get it right, while the Express salivates at the prospect of bludgeoning the poor even harder.  The BBC interviewed Kirsty McHugh of the ERSA, who said what you would expect since she's paid by the outsourcing companies, and Richard Johnson who used to work for Serco and talked sense.
So let's spell it out.  This scheme is largely about IDS's temper at the failure of the Work Programme, which he interprets as the failure of the unemployed.  So they must be punished.  And it will have the advantage of taking loads of people out of the unemployment figures.  They will be sanctioned en masse, or driven into the black economy, or forced onto workfare and so counted as employed.  
Newsnight is doing something on the scheme.  I don't think I'll watch.

Ingeus sold and WP extended

There's an interesting report in the Financial Times today about developments in the Work Programme.  Ingeus Deloitte, the company which originated in Australia, has been sold to an American company, Providence Service Corporation.  The Work Programme business, says the FT, is worth £150m a year to Ingeus, "which is understood to have won such a large share of the market by bidding more cheaply than rivals".  Despite the failure of the WP to help the vast majority of those referred to it, there are obviously profits to be made.  And Provident can simply take over Ingeus's activities by bidding for the offender rehabilitation contracts (and anything else on offer).
The other interesting point in the article is that the Work Programme contracts are due to end next year, but they are expected to be extended to 2016 "to avoid the general election".  (Labour has already said that they wouldn't renew the contracts if they get into power.)  By this stage the "attachment" payments should have ended; would we be told if they haven't?  The contracts didn't seem to be generating much profit for the providers, but Provident obviously thinks that the potential is there.  Richard Johnson, formerly of Serco, says that can only come from cutting costs, but it's hard to know how companies like A4e can cut costs any further.
It makes me wonder, again, whether A4e is in line for a buy-out.  Would Emma Harrison be prepared to sell her 85% stake in the company?

An interesting week

Well, where to start?  "Welfare" has certainly been in the news this week.

On the outsourcing front, we knew that there were moves to oust ATOS from their WCA contracts and move the work to other providers.  Today we learn that the company has announced that it wants out.  They gave the information to the Financial Times, perhaps significantly, giving as the reason the abuse of their staff.  They say that they've been trying to agree an early exit for some months (the contracts are due to end in August 2015) but won't walk away until there are other providers in place.  The BBC news website reports that the government is furious at this announcement because it will probably mean that other companies will put in lower bids to take on the work than they otherwise would.  Which other companies would pick up this poisoned chalice?  Capita already has half the PIP contracts, along with ATOS, so they might be keen.  Then there are the other usual suspects, including A4e.  This is not, after all, payment by results (not officially, anyway) so it's a guaranteed income.  But would it be worth the hassle?

The row between the government and church leaders escalated this week.  27 Anglican bishops and 15 nonconformist church leaders wrote a letter, published in the Mirror, which attacks in no uncertain terms the government's creation of a "national crisis" of hardship and hunger.  This forced the whole subject onto the agenda, with much discussion on TV and radio about Cameron's claim to a "moral mission".  The debate was further fuelled by the publication of the latest sanctions figures.  Record numbers have been plunged into destitution in the year to September 2013; 897,690, including 22,840 ESA claimants.  This compares with 500,000 in the year to April 2010.  Iain Duncan Smith's response, parroted by his colleagues, was, "sanctions are used as a last resort".  We remain unclear as to whether he actually believes that.  My congratulations go to the Bishop of Manchester who, in the face of a very hostile interview on BBC radio, was extremely coherent and accurate about the hardship inflicted on individuals for no good reason.

However, a leak to the Guardian this week showed that, just when you thought they couldn't sink any lower, they do.  The idea has been considered by the DWP of charging people who have been stripped of their benefits to take the case to appeal.  At the moment 58% of appeals are successful.  This is clearly too many for the DWP, so slapping on a charge which no one could afford to pay would cut this figure admirably.

While the expected drivel poured from the right-wing commentators and their readers, I do suspect that a lot of people who had previously taken no interest in the subject have now woken up to what is going on.  It probably won't change anything in the long run, but getting all this out in the open can only be a good thing.

Burying bad news

The birth of the Windsor baby, and the fact that MPs and their journalist mates are all on holiday, meant that a significant news story was effectively buried.  The papers which did pick it up are a bit confused, and no wonder.  Try the Guardian.  "Atos reports found 'unacceptably poor'".  It's the quality of the written reports which the Atos people make which has not come up to scratch, not, the DWP insists, the validity of the verdicts.  Even so, they are bringing in "additional providers" from next year to work alongside Atos in order to speed things up.  It is really not clear what deficiencies the DWP is admitting to.  The Mirror says, "Atos rapped over wrongly passing fit for work up to 41% of claimants", and that the DWP was "told to act because of deep concerns about Atos at No 10".  That doesn't seem quite true, but who knows?  And what penalty has Atos actually paid?
Another little-reported failure is that of the Youth Contract, the wage incentive scheme which was supposed to help 160,000 young people into work over three years.  In its first year it helped just 4,700.  The Guardian and the Financial Times both analyse the figures.  But unless you read these papers you won't have heard any of this.  Is the timing accidental?

They've got away with it

It must be congratulations all round at the DWP.  The Work Programme results are terrible but hardly anyone has noticed, because the raw numbers are impressively big, and a week of spinning has convinced the largely gullible media that failure is actually success.  Well done, chaps.
But these are the figures (in percentages):

Why are there no headlines this time around about "its worse than doing nothing", as indeed it is for more than half the providers?  Leaving ESA aside for the moment, the minimum contracted figures - what the providers contracted to deliver - were only a tiny amount above the dead weight figure - what the DWP assumed would happen with no intervention at all, which means no money spent.  But half the companies couldn't even deliver that.  For JSA 18-24 the wooden spoon goes to A4e in South Yorkshire, which managed just 15.5%.  Yet Mark Hoban says, "The improvement in performance over the past year has been profound and the scheme is getting better and better."
The failure with ESA is inescapable, and some publications, like the Independent, choose to headline that.  But it's been spun for a week that this is down to lack of "resources", i.e. those on ESA need more money spent on them than the programme provides.  The excuses are somewhat tortured.  An outfit calling itself Inclusion (it describes itself as a "cutting-edge thought leader" but doesn't say where its funding comes from) wants to move the goalposts and take the economy into account.  It recognises that poor performance means less income so even poorer performance.  Another think-tank, the Social Market Foundation (equally cagey about where its funding comes from) says, confusingly, "Poor performance against the DWP's minimum levels cannot be taken as evidence that providers are doing a bad job or that the scheme offers poor value for money," because we don't know how a different approach would have fared.  The ERSA, the mouthpiece for the providers, declares that the government's way of measuring performance is wrong and that the targets should take the state of the economy into account.
The Financial Times tells us that "several providers have been put on watch for having their contract terminated."  12 contracts, they say, have been put under a "performance improvement notice".  But I would be very surprised if any providers do actually lose contracts.  In another piece the FT points out that the WP is "cheap and it isn't working".  The bidding process meant that companies said they could do it "at a lower cost than was probably wise", and so the profits aren't coming in which would enable them to spend enough to be successful.  It's that negative spiral which those actually experiencing the WP know only too well.  The article concludes with the opinion that Osborne is shifting money from the WP to the jobcentres.  Yet JCP has suffered big staff cuts recently.
In real business, as opposed to outsourcing, contracts have a legal reality.  They come with penalty clauses, punishing the contractor for failure to deliver.  In this business, the companies know that the minimum contractual requirements mean little or nothing.  The likes of A4e are used to missing their targets and still making loads of money.  The government has an interest in pretending that failure is, in fact, success.  When the model is payment by results (but not really) the contractors make less money; but the casualties are not the businesses but the people who have not received the service.
It is nonsense to blame the economic situation.  If the number of unemployed people who can get back into work depends on the state of the economy (and it probably does) then what is the point of a scheme like the Work Programme?  The companies are adding little or nothing to what would be happening anyway.
However, it appears that Iain Duncan Smith has got away with it.

Desperately spinning

Last night's BBC news item on the Work Programme figures was a response to the officially-sanctioned spin on the latest performance data, not to be released for another week.  This morning a few of the papers have picked up the ERSA's figures.  No one seems bothered that this is all authorised by the DWP, as with the first year's figures, to extract the best publicity and deflect attention from next week's reality.
It appears that the best that can be said is that around 27% of those who have started the WP have found work.  And it's better for the under-25s, at 40%.  But what does that mean?  These are not "sustained" jobs, the outcomes for which the providers get paid.  They could be very temporary jobs, even single shifts.  So the official figures are going to be much worse.
The scope for spin is immense.  The Independent, which has a thoughtful piece, still manages to say silly things like "321,000 (27 per cent) started a job after being found one."  They are unaware, apparently, that many of those jobs will owe nothing whatever to the WP provider; no one found them the job, they found it for themselves.  But the paper still goes for the downside of the figures - three quarters of people on the WP haven't started a job.
The Mirror, naturally, emphasises the negative, that 900,000 sent on the WP haven't started any work.  They end with a quote from A4e.  "A spokeswoman for A4e, one of the biggest welfare-to-work providers, insisted that the figures showed 'a marked improvement'.  'It is gaining momentum,' the spokeswoman added."
The Financial Times tries to be even-handed, suggesting that "the scheme may be starting to deliver results".  They quote Kirsty McHugh of the ERSA maintaining that "the improving economy and the fact that providers had simply got better at helping clients had contributed to the stronger performance".
So all we really know is that around 27% of WP clients have had some sort of job start; and that the figure is higher for the under-25s but much lower for those on ESA.  (Can someone remind me of the projected dead-weight figure for Year 2, please.)  It all sounds rather feeble.  Yet Iain Duncan Smith and his team are happy for this preliminary spinning to take place.  Perhaps we will now all ignore the true figures when they are released without fanfare next week.

The press we deserve?

It's the middle of the night and I can't sleep, so I'm checking the news feeds ahead of the release of the performance data at 9.30 am.  There's plenty of interpretation already.  But the prize must go to the Express: "Jobs scheme 'helps 20,000 a month'".  Yes, they've taken the ERSA's spin and published it as the facts, ignoring deliberately the reality that this is people who've found any sort of work, temporary, part-time, which got them off the books for a little while.  "Almost a third of those who started the Work Programme in June 2011 have been supported into a job so far, said the ERSA. More than 64,000 people found work under the programme in the three months to September, it was reported."  (The words "helps" and "supported" will startle many people who know that the providers had nothing to do with it.)  But this is what Mark Hoban and the government wanted, of course.  Don't bother with the facts - that the figures for sustained jobs are appalling - just spin dizzily so that Express readers get the propaganda.
The Independent goes with "Government's Work Programme only helps one person in three find a job".  They do report the ERSA's figures, but understand the spin.
The Guardian has published the full data which the private companies have put out and asked readers if they can do anything with it.  Good for them.
The Financial Times yesterday had access to the actual figures and reported that the best-performing company, Serco, earned nearly double what the worst-performing, Prospects, earned.
So as as we await the actual figures (and I hope I can get some sleep in before then) we can already see what the press are going to make of it.  Accurate reporting?  Some papers don't know what that means.

"Descending into chaos"

So says the Financial Times about the Work programme.  Mind you, they're quoting Labour's Liam Byrne.  But the verdict is based on a slump in the number of people being referred to the WP, down from 65,000 in February to 40,000 in August.  "Opinion is divided as to why," they say.  Some think that the pattern of employment is responsible, with fewer people being out of work for the 9 months stretch which would get them referred.  Certainly this would have an effect if there is a big increase in temporary jobs and unwanted part-time jobs.  Another view is that the Jobcentres have lost so many staff  that they are not able to keep up with the referrals.  Whatever the reason, it's "beginning to worry the market", says Kirsty McHugh of the ERSA.  Mark Hoban, the minister, isn't worried.  He says that referrals are higher than predicted when the companies bid for the contracts.  Byrne is pushing for publication of the performance data - and so are we all.

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".

"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.

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.  

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.  

Changes

Let's not get carried away.  Emma Harrison is no longer Chair of A4e, but amidst all the media coverage only two papers point out that still owns almost all of the company.  If she hangs on to those shares she can still continue to make a great deal of money, if not from the Work Programme then from all the other contracts.  The Financial Times quotes Jim Carley, a consultant to the outsourcing industry, saying that she will probably want to sell if she's not involved any more, and that A4e is "one of the few companies out there that is still buyable". 
Andrew Dutton, A4e's CEO, is putting in place a review of the whole company and its processes by a top law firm.  Talking of the fraud allegations, the Telegraph has a mysterious paragraph: "Sources said police are aware of allegations that the fraud went higher up the chain of command than the four front line staff that have already been arrested, although not to the top of the company."  The Telegraph reckons that there's more to emerge over the weekend.
Maybe.  But the Daily Mail is quite hysterical.  They put online two articles.  The first claims the credit for her departure: "She resigned as chairman of A4e four hours after the Daily Mail warned  it was to publish claims of 'rife' corruption at the employment firm."  It goes on: "A whistleblower claimed that champagne was lavished on successful staff while forged signatures and blank timesheets were ‘routine’ techniques used for bumping up the numbers of successful job placements."  The second article details those allegations, giving five minutes of fame to ex-employee Tracie Spiers.  She describes what anybody in the industry would see as a mixture of poor practice, incompetence and deliberate fraud.
A4e brought the techniques of sales teams to the business, completely inappropriately.  Some staff are actually on commission, getting paid for every job outcome.  There are prizes for successful teams; from the champagne described in the article to holidays.  This pressure can lead to the fraud of forging signatures on job outcome forms.  The interests of the clients have vanished.  The forging of timesheets smacks of sheer incompetence.  It was perfectly possible to devise a system for getting those timesheets updated daily and signed off on Friday.  Failure to do that leads to fraud.
In the past A4e has been quick to threaten whistle-blowing staff with legal action.  The tide of such allegations may well be unstoppable now.
A4e will certainly change.  The cult of personality will go, for one thing.  But Dutton will have to look at changing the whole ethos of the company, with good staff training and better management.  We will have to wait and see.

Emma pops up again

Emma Harrison made another appearance on the BBC today, this time on Pienaar's Politics on 5 Live.  I haven't listened to it yet.  Fortunately the Scottish Sunday Express has provided a summary of Harrison's views under the headline "PM warned over vulnerable families".  She is described as "the woman appointed by David Cameron to get families back into work".   And she's worried that the £26,000 benefits cap could harm some families with a number of seriously disabled children, families in which the parents are the full-time carers and which would cost the state millions without that parental care.  Can't argue with that.  And she's right that it's a "populist movement" (though I wouldn't use that phrase) that wants to cap benefits.  However, it grates when she says, "I know families ...".  We are always told that it's Harrison's personal knowledge of the unemployed which informs her opinions.  And she seems to row back a bit at the end of the article:"Of course we should reform welfare. We should make it work for today. Somehow it has become possible for 120,000 families to live on benefits. Now within that group of families there might be a small percentage who will always have to live on benefits because of some very, very extreme circumstances." 
If Harrison is going to use her position to challenge the government's more extreme moves, we can only applaud.  But she will need to be armed with some genuine figures.  And she will need to face some informed questioning about A4e's activities.
Perhaps I'll grit my teeth and listen to the programme tomorrow.


Monday:  Harrison's remarks have made other newspapers, including the Financial Times, (which thinks her remarks will be a blow to David Cameron), the Mirror (which says that the "Jobs Tsar" has turned on the Tories) and a brief piece in the Scotsman.  

It won't work

It's in all the papers this morning; a damning report on the Work Programme by the National Audit Office. The Telegraph reports it straightforwardly. It says that only 26% of those referred to the programme will get work, not the 40% forecast. "Fewer people than expected are being referred on to the work programme in the 'harder to help' category, as providers scramble to cover upfront costs by helping the easiest set of jobless back to work, such as the highly qualified or experienced, to ensure they collect money under the contracts." Some providers will get into serious financial difficulties. The government paid out £63 million to terminate the FND contracts, only to give the WP contracts to the same companies. The Financial Times points out that some companies offered price discounts to get the contracts. Not surprisingly, the industry says it doesn't recognise the figures. And Chris Grayling says it's all guesswork, and it's all right because it's the companies which are taking the risk, not the taxpayer. No, Mr Grayling, it's the unemployed who are taking the risk. He also says that the providers will be able to release "limited information" before the official release of data in March; so watch out for loads of spin - numbers of job outcomes without any start figures. What's important about this, of course, is that the government is waving the Work Programme as the solution to everything, especially in its determination to reduce welfare benefits.

No one has yet related this to the release of figures for Flexible New Deal by the DWP. They show that the total cost (money paid out to providers) was £770m. The percentage of "sustained" jobs to number of starts was 12.2%. Yes, just 12.2%.

Do you remember an exercise you used to do at school called "comprehension"? You had to read a piece of text and then answer questions to show you'd understood it. Well, if you were any good at that you might like to try reading a submission A4e made to the Communities and Local Government Select Committee on community budgets and tell me what the point of it is.

Reasons to be cheerful

Is it all gloom and doom for the Work Programme, or is Mark Lovell right to be cheerful?

On 1 December the Financial Times said that the WP was "hanging by a thread". The numbers of people out of work is forecast to rise, and Ian Mulheirn, director of the Social Market Foundation think-tank, said, "The combination of rising caseloads, falling labour demand, and the shift to 100 per cent outcome-based funding for providers is dire news for Work Programme viability." Mulheirn has warned before that WP providers could ask for a tax-payer bail-out if they can't make money. The director of another think-tank, Inclusion, says that "providers will be able to place an average of 7 per cent fewer people in work over the next five years than previously estimated." A spokesman for the DWP was determinedly upbeat: "even in these tough times there are jobs out there, with Jobcentre Plus taking 10,000 vacancies every working day."

Mark Lovell takes issue with this pessimism in a piece on A4e's website the next day. He is hampered by the fact that he is not supposed to publish outcome figures, but says that more than 7,000 people have got jobs via A4e since the launch of the WP. He says that, "Sustainment is higher than we forecast so far". We don't know, of course, what proportion of starts this represents. But he says that the money is coming in.

Business as usual

Anyone who thought that A4e's embarrassment over the workless families contracts would prove a turning point in the company's fortunes is probably guilty of wishful thinking. It's business as usual. Roy Newey is in India with a trade delegation of training organisations, including some FE colleges, and he is quoted as saying, "eastern India provides exciting opportunities to further strengthen India-UK cooperation in skills and education sector." Mark Lovell has been in the US. I suspect that Emma Harrison will not be giving interviews for a while; but there's a piece in the Sun, (dated 1 September) which is straightforward PR for her; and the Sun, sadly, has a bigger circulation than the Guardian. And now the BBC is running an item about research into "problem families" which reminds us that Cameron "appointed Emma Harrison as a 'family champion' to lead a drive to get workless families back into employment" with not even a nod to the Guardian revelations. We won't get to know whether Harrison's cosy relationship with MPs has been damaged, but it won't affect the company's ability to win contracts in the future.

The Financial Times previews the Radio 4 programme on the Work Programme (Thursday 15 September, 8.00 pm). Chris Grayling denies that there will be any renegotiation of the contracts, although "providers now say privately that they intend to make cost savings if they are unable to meet targets, raising the spectre that very little will be spent on helping those going through the scheme." And with the sort of irony which leaves one shaking one's head in disbelief, the programme quotes Hayley Taylor as saying that the WP is "crude and often ineffective". " “Grouping people together is just not going to work because what someone who has been long term unemployed needs and what someone who has been newly made redundant needs are two totally different things,' she said." If that's the level of insight of the programme, with all those staff and clients whose views were solicited ignored, then it won't be worth listening to.