Welfare to Work

Key evidence of fraud missed in welfare-to-work schemes

Key evidence of fraud missed in welfare-to-work schemes

The £1-billion-a year scheme to help the unemployed into work was so badly madly managed by ministers that vital evidence of potential fraud was never picked up.

Ministers have been condemned by a committee of MPs for failing to investigate properly allegations of fraud in the Government’s flagship schemes to get the unemployed back to work.

The Commons Public Accounts Committee said the Department for Work and Pensions (DWP) had missed “vital evidence” of potential fraud at the welfare-to-work provider, A4e.

The department was accused of failing to “exercise sufficient oversight” of the private companies delivering the programme. Cases of alleged fraud were overlooked because officials had not “asked the right questions”.

The report Preventing Fraud in contracted employment programmes

The committee concluded that the DWP had been remiss in failing to obtain internal audit reports from A4e from 2009 which detailed a “considerable number” of cases of alleged fraud and malpractice. Since May 2010, the company has won contracts worth £200million to run welfare-to-work schemes.

The Rt Hon Margaret Hodge MP, Chair of the Committee of Public Accounts, today said:

“Where the Government chooses to use private companies to deliver public services it is essential that proper arrangements are in place to prevent and detect fraud and malpractice. In this instance, the DWP’s arrangements for overseeing and inspecting its contractors were so weak that vital evidence on potential fraud and improper practice was not picked up. The Department failed, for example, to obtain from A4e damning internal audit reports produced in 2009 which pointed to instances of potential fraud and malpractice across the country.

Whistle blowers,
There were a number of whistle blowers. One of the whistleblowers was Eddie Hutchinson, an accountant who was appointed A4e’s head of audit in 2010. He alleged that an “unethical culture” had led to “systemic fraud” at the company.

Another whistleblower who had worked at A4e told how she had been asked to “fix” files to suggest that people had successfully found work.

A4e has made its position clear; (… they do have a point…)

A spokesman for A4e said:

“The allegations highlighted in today’s report all relate to historical, paper-based contracts. Where we have made mistakes in the past, we have acknowledged them and ensured that all allegations, where evidence was provided, were fully examined. There are no new allegations in this report.

yesMinister Comment
If you actually read the report you will see that it is an inditement on DWP and not providers…. see our previous posting… No Smoking gun at A4e

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