From 2012: Private Eye on Fraud by Workfare Company

This Sunday, 18th January, I reposted an article from Glynis Millward’s blog, reporting the trial and conviction of several A4E employees for fraud. They had been falsifying the numbers of unemployed people the company had helped back into work, in order to get money under the government’s ‘payment by results’ scheme. Although noteworthy, it wasn’t the first time a workfare company had committed such fraud. Johnny Void has also blogged about similar abuse of the system by the workfare companies. And three years ago, Private Eye reported a similar case of what may have been fraud by Working Links in their edition for the 18th -31st May 2012. The article ran:

Workfare
The Links Effect

“Benefit-busting contractor” contractor Working Links tried to claim government cash for helping people into work when the “clients” couldn’t be traced, were still receiving Jobseekers Allowance or were actually helped by rival “workfare” companies.

The company also made several duplicate claims, asking to be paid twice for helping the same person, according to internal papers passed to the Eye. The documents, which cover Working Links’ £5m-plus contract for work on the New Deal for Disabled People in 2007-8, were found in a disused desk on a rubbish tip.

Working Links, one of the UK’s largest “benefit-busters”, had contracts to encourage incapacity benefit claimants back into work through coaching, interview advice and other “job club” activities. It was paid around £300 for each unemployed “client” and received bonuses of more than £1,000 for each one getting a part-time job and nearly £3,000 if they found full-time work.

The files include monthly invoices from Working Links to the Department for Work and Pensions (DWP) ranging from £400,000 to £1m. The DWP rejected up to £20,000 a time on many invoices because of multiple errors. The DWP did not investigate the false claims nor treat them as fraud, and the files do not show these were deliberate errors. However, they do show that Working Links was more enthusiastic about claiming cash from the government than it was about keeping accurate records. Separately, DWP “compliance visits” have found systematic overclaiming in some Working Links offices. (See Eye 1311).

Overclaiming appears rife among workfare contractors. Emails between the DWP and the National Audit Office obtained under freedom of information by the Eye show that “benefit-busting” firms made more than 10,000 false claims on the “New Deal” employment scheme in 2010-11. In the emails, the DWP told the auditors about failures in checking that claimants the contractors claimed to have helped had actually signed off benefits. The DWP describes “30 percent failing the check and around 10 percent ultimately unvalidated”.

A third of claims by contractors are initially questioned. Most are cleared up, but the remaining 10 percent are false. The DWP found that of 104,767 invoices from New Deal contractors, 10,462 failed the off-benefit check and remain “unpaid”. This means that companies like Working Links and the giant A4E asked for to £30m they were not due. The DWP did not pay the cash, but the fact that it did not investigate the false claims further shows a liberal attitude to the contractors.

Working Links, part-owned by temp agency Manpower and consultant CapGemini, has many other government contracts, including £300m for running the new Work Programme in Wales, Scotland and the South West.

This is a shocking statistic, but it isn’t really surprising. I posted up another piece by Private Eye yesterday reporting on the conclusions of the NAO several years ago that the welfare-to-work scheme would fail, and would need bailing out. Moreover, as Johnny Void has repeatedly blogged, the workfare system is so flawed that you are far more likely to get a job through your own efforts than from one of the workfare companies.

The entire scheme is set up to encourage fraud, and based on the exploitation of the unpaid labour of the jobless themselves. It should be totally discontinued.

Tags: A4E, CapGemini, DWP, Fraud, Glynis Millward, Incapacity Benefit, Johnny Void, Manpower, National Audit Office, New Deal For Disabled People, Private Eye, Temp Agencies, Workfare, Working Links