So just who are A4E, didn’t we hear something unsavoury about them a while ago? What do they do? Where do they fit in? Well, I’ll try to answer those questions.
A4E is a private company, and as you may expect, it has various versions of its company name, but I will concentrate on A4E Ltd, first registered in 1991. The chairperson of this company was Emma Louise Harrison, and there are 7 Directors, one Company Secretary (Mr Neil Watson) and they employ the best part of 4,000 people.
The 1st 5 Directors are the usual mix of businessman-type Directors with nothing particularly unusual in their directorships. The final two are titled people,
#6 Sir Hugh Ridley Sykes international industrialist and investor, noted for championing regeneration in and around Sheffield.
#7 Sir Robin Urquhart Young, in 2002 he was Permanent secretary, Department of Trade and Industry. He enjoyed an extensive career in Whitehall spanning over 30 years and culminating in Permanent Secretary positions in Department for Culture, Media and Sport then Department of Trade and Industry. He left the Civil Service in 2005 to start a new, non-executive career including Bovis Construction Ltd; Dr Foster Ltd; EEI (East of England International) EEI Board; Dr Foster Intelligence Ltd; Euro RSCG Apex Communications Ltd; the East of England Science and Industry Council; the Council of the Institute of Directors and the IOD Board. Little mention that East of England International Ltd, a company he is a director of, and chairman, has filed for liquidation at the beginning of the year! They kept that quiet…
Didn’t we hear something unsavoury about them? Where do I begin? Well I’ll begin with White and Case, Tom Winsor’s favourite law firm and advisors to G4S. I came across this today;
The Skills Funding Agency is to work alongside White & Case LLP, appointed fraud auditors by A4e, over doubts of a cover-up paid “independent” review. What A4e means is an audit conducted externally, but its hardly independent when two major factors come into play:
1) A4e are paying (White & Case is providing a service to A4e); and
2) A4e has control of the documents in the first instance (they can hold back or delay document handover).
Doesn’t this sound kind of familiar? Tom Winsor’s Independent Review? White and Case advising G4S? Perceived lack of independence? Call me an old cynic, but I don’t know.
A4E have also suffered the following misfortunes over the last few years;
In 2008, refugee and asylum charities criticised A4e for asking them to work as its unpaid partners.
Farrukh Husain, director of the Migrants Resource Centre, accused A4e of “gross exploitation of the voluntary sector“. He further commented: “A4e must think the voluntary sector is naive to simply wish to sign up to a relationship that delivers little in return for voluntary organisations and fattens up the profits of A4e.”
Maurice Wren, director of Asylum Aid, expressed concern that A4e’s actions could reduce the quality of bids for future Home Office contracts to help and support refugees: “This could get some organisations thinking ‘if we are to have any chance of getting a contract, we have to reduce our costs’. This means a poorer service for a very vulnerable client group.”
On 28 June 2009, The Observer disclosed information regarding a fraud investigation into A4e which was instigated after the Department for Work and Pensions uncovered discrepancies in its “confirmation of employment” forms – discrepancies which centred upon the falsification of employers’ signatures by a number of recruiters. One recruiter also made a fraudulent deal with a local temp agency.
A4e’s official statement read: ‘All the matters raised in the article are known to both A4e and the DWP and have been the subject of both an A4e investigation and a DWP led investigation. The A4e investigation revealed that whilst candidates had real job opportunities, these jobs did not meet the funding criteria being less than 13 weeks and 16 hours a week in duration. These investigations have resulted in the departure of both individuals from the company and the ceasing of all activity with the employment agency concerned
On 29 June 2010, A4e published a statement that an employee’s laptop containing personal details of 24,269 people had been stolen. The employee’s laptop was not encrypted, and was not recovered.
In November 2010, A4e were fined £60,000 by the Information Commissioner’s Office for the loss of the laptop. Commissioner Christopher Graham, said that it “…warranted nothing less than a monetary penalty as thousands of people’s privacy was potentially compromised by the company’s failure to take the simple step of encrypting the data”.
In November 2011, A4e were taken to task by a Social Security Tribunal for halting the benefit payments of claimants who wished to be accompanied by representatives of their choice at meetings run by A4e. The report also states that members of A4e lied to the DWP in order to cut the benefits to claimants.
Middlesbrough South and East Cleveland MP Tom Blenkinsop said: ‘There needs to be a full investigation into this case. This is public money here, and this must be looked into to restore confidence into all regeneration projects carried out locally.
In January 2012 four former employees of A4e were arrested on suspicion of fraud dating back to 2010.The alleged fraud was uncovered by an internal investigation by A4e. The two women, aged 28 and 49, and two men, aged 35 and 41 were bailed until mid-March.
On 22 February The Guardian revealed that A4e had forced jobseekers to work unpaid in its own offices, had been investigated nine times by the Department for Work and Pensions since 2005, and had been forced to repay public funds on five separate occasions after government investigations found ‘irregularities’.
Emma Harrison resigned as chairman of A4e on 24 February 2012, amid criticism of ‘improper’ conflicts of interest regarding government contracts and allegations of ‘routine’, ‘utterly rife’ fraud from whistleblowers.
This bit’s priceless;
Prime Minister David Cameron has been criticised after it was revealed that Harrison was paid an £8.6 million shares dividend in 2011, in addition to her £365,000 annual salary, with the majority of this funded by the taxpayer. Margaret Hodge described the dividend as “ripping off the State” and urged ministers to suspend all work with A4e.
The company’s chief executive Andrew Dutton stated that Harrison’s dividend payment reflected her personal risk as a shareholder. MP Stephen Barclay said the payment’s size was of concern with regard to the DWP receiving value for money. He questioned the justification of paying management fees not linked to performance, adding that “It’s not A4e’s fault if they get paid for poor delivery.” Barclay further established that A4e takes a 12.5 percent management feeof its work that it passes on to local charities.
On 25 February it emerged that in addition to her £365,000 annual salary and £8.6m shares dividend, A4e also paid Harrison and her partner around £1.7m over two years for leasing properties, including their 20-bedroom stately home, to her own firm.
On 26 February 2012 Thames Valley Police’s Economic Crime Unit was revealed to be investigating the alleged theft by A4e staff of ‘tens of thousands of pounds’ worth of vouchers meant to help the unemployed back to work.
The Labour MP Fiona Mactaggart who sits on the Public Accounts Committee has stated ‘My view is that this company has demonstrated that it is unfit to hold this kind of contract’. in relation to the Work Programme.
On 2 March 2012 Fiona Mactaggart, Labour MP for Slough, revealed she had reported A4e to the national auditor on three occasions over the preceding two years, following complaints from her constituents. She stated that A4e “often provides poor service to unemployed people”, “offered courses which had little worth and no recognition” and “are pursuing a policy which reduces the total number of jobs available”
Another case of signature forgery emerged on 6 March 2012. This took place while A4e was working for Redcar and Cleveland Council to help disadvantaged young people into education, training or employment. A Council inquiry found that learners’ signatures had been forged to exaggerate the number of vulnerable people the project had reached. A4e was forced to withdraw from this part of the project.
On 8 March 2012 the Daily Mail reported allegations from Amy Rae, former team manager at A4e’s Edinburgh office. She stated that A4e did not provide the training they were paid £950 to provide for each young person referred to their Community Task Force programmes by the JobCentre, instead sending them home. Rae blamed this on the failure of A4e management to authorise funding for the training, despite repeated requests. When inspectors from the Department of Work & Pensions arrived to inspect the training which was not taking place, Rae states she was instructed to deceive them by borrowing people from another A4e course in the same building and instructing them to lie, if questioned by the inspectors, about which course they were on: ‘I had to stage-manage a completely bogus training session, complete with a fake chart. It was awful. It was all lies, a facade. We just pretended.’ Rae is also reported to state that this was not an isolated occurrence.
On 9 March 2012 the Department of Work and Pensions announced it had ‘been made aware of an allegation of attempted fraud in relation to a Mandatory Work Activity contract with A4e’. It stated that it had begun an investigation into this allegation, and also, as a result of the allegation, an ‘independent audit of all our commercial relationships with A4e’.
On 22 March 2012, the BBC’s Newsnight current affairs programme revealed that they had received a leaked document suggesting ‘systemic fraud’ at the company. The following day,Labour MP Margaret Hodge, who chairs the Commons Public Accounts Committee, called on the government to suspend its contracts with the jobs training agency.
On 3 April 2012 Exaro news revealed that A4e was being lined up for another major government contract despite being at the centre of a fraud investigation. Ministers made the company the preferred bidder to take over the sensitive Equality and Human Rights Commission (EHRC) helpline to advise people of their rights in discrimination cases.
Private Eye has revealed that an additional £4m was shared between the other directors of A4e; in the case of Roy Newey, Hugh Sykes and Steve Boyfield, through Personal Service Companies, thereby avoiding the payment of National Insurance.
On 20 April 2012 Police officers raided A4e’s office in Slough after allegations were referred to them by the Department for Work and Pensions. A 33 year old man was arrested and later bailed.
On 15th May 2012 a review conducted by law firm White & Case of its systems and controls has concluded that procedures that are currently, or set to be, in place meet obligations to minimise the risk of fraud, bribery or conflicts of interest, according to A4e.
“These findings demonstrate what I have always maintained to be true – that there is no place for fraud at A4e and make it clear that A4e has strong controls around its flagship contract the Work Programme,” said A4e CEO Andrew Dutton.
On22 May 2012 Exaro news published leaked internal audit report which exposed ‘potential fraud’ at A4e The report compiled by the audit and risk department examined a sample of 224 of the company’s job placements and found that “potential fraudulent/irregular activity is not confined to one particular geographical area of the division, and shows a potential systematic failure to mitigate the risk towards this behaviour at both an office and regional level”. Auditors also discovered A4e sent an unemployed job-seeker to work in lap-dance club This seems to contradict the results of the White and Case review above.
A former employee from the Bradford office of A4e reports that A4e staff were sent to the stationstore Staples to buy their own rubber stamps with which to falsify Employment Verification Template forms, so A4e could defraud the Department of Work and Pensions.
A former employee from the Manchester office of A4e reports that pressure to meet quotas made fraud commonplace: ‘Forging signatures used to go on all the time. You had no choice because it was made very clear to you that you would lose your job unless you reached your targets. If you couldn’t get enough so-called “job outcomes”, you would just have to forge one, so you would find a genuine employer’s signature on another form and hold it up to the window under a blank one. It appeared everyone did it and nobody ever questioned it.’
A former employee from the Newcastle office of A4e reports that staff there were asked to sit basic numeracy and literacy tests alongside the unemployed to ‘help bump up the numbers’: ‘It was in a really hot room and they crowded us all in. I could hardly breathe.’ She likens the Newcastle office to a ‘workhouse’, and describes conditions there as ‘utterly inhumane’. She states that people referred to A4e were required to ask permission to use the toilet: ‘The problem was, if you let them use the toilet, they would never come back and that would mean A4e would lose a “client” and lose money. So they had security guards — ex-military, ex-police, ex-prison guards — patrolling the corridors.
And, finally, a Whstleblower’s Tale;
My name is Eddie Hutchinson and I was employed by two companies, Working Links from 2007-10, and A4e from 2010-11. Within each company there were occasions on which I encountered unethical behaviour or wrongdoing that fell way below standards that should be expected of organisations funded by significant sums from the public purse.
I was appointed head of audit of A4e in October 2010. It quickly became evident that the incidence of frauds and irregularities was a major problem for the company. An ever-increasing volume of frauds came to my attention.
The type of frauds perpetrated by operational staff at A4e usually related specifically to the falsification of job outcome evidence on a number of legacy welfare-to-work contracts.
Such contracts from memory attracted a payment of around £1,300 for A4e for each jobseeker placed into work and this was followed by a payment of £3,000 to A4e once this placement became a sustained job.
The fraud carried out was usually that job outcome evidence required to be completed under the contract would be fabricated by the falsification of employers’ signatures by some A4e staff involved, which meant that erroneous jobs were recorded and targets for job outcomes apparently met.
This whistleblower’s account was submitted as evidence to the select committee, and subsequently leaked
Working Links (Employment) Ltd is a limited company registered in England and Wales. Mission Australia (an Australian charity), and the Secretary of State for Work and Pensions each own one-third of the share capital, with Manpower plc and CapGemini UK plc holding a sixth each. CapGemini UK PLC is now a major supplier of outsourced services to British Police Forces, especially IT etc etc.
A4E – What are they about? Well their stated aim is to try and get people off the dole queue, back into work and save Great Britain PLC some money in the process. Difficult to see how they can achive that, and if they do they could save so much more by taking less commission of UK Government.
What are A4E up to next? Well according to David Cameron they would make an ideal company, along with our old friends G4S, to become involved in the process of Rehabilitation According to an article in the Daily Mail The scheme will see firms such as G4S and A4e, along with charities and voluntary groups, offered cash incentives to put offenders back on the straight and narrow. We already give these companies enough money, and now we’re going to give them more? Do they have a proven track record?
Is this a suitable business to be in partnership with HMG? You decide.