Private companies from hell stealing £1 bln of taxpayers money thanks to the Nazi DWP
Private companies getting paid £1 billion to help jobless who would have found work anyway
Up to £1 billion of taxpayers’ money is being spent on finding jobs for unemployed people even though they would have got work without any help, parliament’s spending watchdog will say today.
By Rowena Mason, Political Correspondent
12:01AM BST 15 May 2012
In areport, the Public Accounts Committee will raise concerns about the Coalition’s Work Programme, which pays private companies to find jobs for unemployed people.
One of the major worries is that companies are getting paid at least £400 just to assess each candidate, when many would be in the same situation “without the programme”.
Some of those unemployed people would already have found jobs of their own accord, while others will remain on benefits that continue to be funded by the taxpayer.
The report will say payments for people who did not need the programme amount to nearly £1bn and could “potentially” be even higher – the equivalent of £40 for every household in Britain.
MPs will also say they were “sceptical” that it was value for money to pay around £50 in “management fees” for every jobless person processed.
“We need to be assured that significantly more people are in work than if the programme had not existed,” said Margaret Hodge, chairman of the committee.
Some companies may also be taking their fees for jobless people who are easy to help, while ignoring the more difficult cases.
“Fees will be paid to contractors based on outcomes and regardless of the service individuals receive,” Mrs Hodge said. “Such an arrangement might tempt contractors to pass over those who are hardest to help into employment and cherry pick those who need little support.”
The report finds the Coalition had done well to set up the scheme so quickly, but this meant its IT system was not working in time and its business case was made after the project was given the go-ahead.
The MPs on the committee will also call on the Government to make sure companies hired under the Work Programme are subjected to more scrutiny.
One of the private companies running the scheme, A4e, has been hit with a string of fraud investigations relating to its employees over the last few years, including one current police inquiry.
The Public Accounts Committee said private companies should publish the pay of their bosses and full details of their profits if they are dependent on taxpayer cash for most of their contracts.
A spokesman for the Department for Work and Pensions said it was a big achievement to have given support to more than half a million jobless people within a year of introducing the Work Programme.
“Every job outcome payment through the Work Programme is fully validated,” he said. “We’re convinced the scheme offers jobseekers the best chance of getting into work at far better value for money to taxpayers than previous schemes.”
He stressed that measures are being put in place to stop “assessment” fees by 2014.