Are welfare-to-work schemes getting away with fraud?


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10:55 am - June 1st 2012

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contribution by Alice Ross

Work and pensions secretary Iain Duncan Smith has made tackling benefit fraud a key plank of his welfare reforms.

Backing a Sun campaign encouraging people to report benefit cheats, he wrote: ‘When people cheat the welfare system, they take money out of the pockets of those who need it.’

But a Private Eye special report reveals that his Department of Work and Pensions is considerably more relaxed about allegations of fraud at some of the companies it has hired to help get people off benefits and into work.

A whistleblower has claimed to the parliamentary public accounts committee that Working Links, a ‘welfare-to-work’ provider that earns over £100m a year from government contractor, has been caught by the DWP at least four times since 2007 claiming money for people who had not in fact been found work. The DWP managed to recover the money, but the Eye reports that the firm appears not to have been punished for the attempted frauds. The company claims it has a zero-tolerance approach to fraud and that all irregularities had been investigated and resolved.

In 2010 DWP pledged to publish regular reports on ‘trends and lessons learned’ from its investigations into allegations of fraud. But when the Eye went hunting no such reports were to be found. Freedom of information requests revealed no evidence of any attempt to start work on such an effort.

Even in the wake of reports of potential fraud at A4e and Working Links, transparency is apparently not a priority. Private Eye claims pressure from DWP ministers led to the public accounts committee hearing evidence from whistleblowers in secret.

In a linked story Private Eye points out that A4e’s lobbyists have close ties to the Conservatives.

A4e has hired Quiller Consultants, the lobbying firm owned by Lord Chadlington, chairman of David Cameron’s constituency party, who last year raised eyebrows when he bought a tranche of land next to Cameron’s Witney home and sold it to the prime minister to use for a garage and drive. A4e has hired Quiller’s George Bridges, who used to run Conservative Campaigns, and helped George Osborne manage the 2010 election campaign.

The full report is in the current issue of Private Eye.


Alice Ross writes for the Bureau of Investigative Journalism

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Reader comments


Didn’t the DWP reduce the number of fraud investigators looking at suppliers.

http://www.guardian.co.uk/politics/2012/mar/30/fewer-investigators-fraud-claims-welfare

Look where the remodelled “listening” Liam Byrne’s going to be http://www.cesi.org.uk/convention Will he be delivering a hard-hitting message to the corporate crooks or will he be indistinguishable from the other bald sleazy liar Grayling? Nobody would spend that kind of money unless it was going to pay back.

3. Charlieman

Congratulations and thanks to Private Eye for their investigative work.

The story does not justify the headline: “Are welfare-to-work schemes getting away with fraud?”

Line 10: The story questions whether companies employed to deliver public services deliver them; did the company lie when it proclaimed that it found a job for Sid? So we have one separate story about whether or not we (tax payers) got ripped off about finding a job placement.

Entirely distinct, UK government has an unstated welfare to work policy. The overlap occurs when benefit recipients are ordered to attend private companies for training; go to line 10.

4. MarkAustin

I was unemployed about 4 years ago, so under the old regime rather than the current arrangements, but I cannot imagine that the case has changed.

All the courses I was compelled to attend were useless, and, in my opinion, designed more to attract government money than to be of use.

To hit some low points, on one an attendee was starting a job within a fortnight. Not unnaturally, he did not turn up on the second day, like two others in the building trade who objected to instructions on CVs, which they did not use. This was wise, as the instructor changed on the second day, and we effectively did the same bit again. The highlight of the last day was a video on interviews: however, as someone from a teaching background, it was obvious that it was intended to be paused for discussion at various points, but the “tutors” took it as an opportunity to bunk off for a coffee, so it was almost totally useless.

On another course, they (quite rightly) set basic arithmetic and reading tests, but then spent the next two days marking them while we spent the time twiddling our thumbs. Despite the fact that searching the internet for jobs was central, they completely missed the fact that one participant was totally computer illiterate—if it had not been for me and another IT specialist, he would not have been able to accomplish anything.

One final point: it has been said that success it determined by getting epeople into jobs. Unless things have radically changed, in my time success for this was judged by getting people of benefit. I got a job as a result of an interview before the course (completely unrelated to the course, and indeed the Job Centre), one person said that, as a result of the course, he was going to sign off and live on his savings, and one was excluded for non-attandance. All these conted as successes.

As a result of my experiences, I now believe that the whole Job Centre etc etc structure should be abolished (with the exception of the minimum necessary to make payments and avoid fraud) as useless and unnecessary.

MarkAustin:

Exactly.

I suspect these programmes were never really intended to get people into work, which is why “fraud” isn’t worrying the government at all, other than the possible negative PR implications. I mean, surely the politicians are reasonably intelligent people, and can see that these programmes (no matter what the quality) cannot actually increase the total employed workforce in the country. They may help one person get a job over another person, but ultimately there are still X jobs, and Y number of unemployed people.

The programmes are really intended to deter people who have other means of survival from claiming benefits, regardless of the long term consequences. Ironically, in that roundabout way, they may in some way “create” jobs, by incentivising people to take jobs they wouldn’t otherwise consider. Some right wingers may argue this is a good thing, imagining great swathes of unfilled menial positions on building sites or picking fruit – but in reality there’s no great shortage of workers in any sector.

Therefore, the bulk of this sort of job creation is going to be work which is in some way illegal, for example with low wages or in dangerous conditions. I’m sure libertarians would be cheering at that, having always hated such laws anyway, but the other equally likely option is work involving illegal activities (like fraudulent telesales, street hawking and unlicenced minicabs, for example). They might be a little less keen on that side-effect.

Of course, there are also the other usual beneficial side effects of ‘outsourcing’ for the government, in this case creating new government-dependent companies who then give them donations and maybe later some nice consultancy fees or directorships.

6. Dissident

oh so cynical, love it, the real problem is the law sold to the biggest bribemasters (sorry, lobbyists)


Reactions: Twitter, blogs
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  40. I Really Should Take More Interest in Twitter | ukgovernmentwatch

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