‘No fraud’ at A4e
THE Government has terminated a contract with Sheffield-based welfare-to-work firm A4e after deciding that it would be “too great a risk” to let it continue.
Employment minister Chris Grayling said the Mandatory Work Activity contract to help up to 1,000 jobless people in south-east England find work would end.
The firm is the subject of a police investigation into allegations of fraud relating to government schemes. An eighth person was arrested on Monday.
Seven other people are on bail until dates in late May, June and July.
The Government cleared the company of fraud allegations but identified significant internal compliance issues.
The Department for Work and Pensions has been auditing its commercial relationships with A4e after receiving an allegation against the company earlier this year.
Mr Grayling said: “While the team found no evidence of fraud, it identified significant weaknesses in A4e’s internal controls on the Mandatory Work Activity contract in the South East.
“The documentation supporting payments was seriously inadequate, and in a small number the claim was erroneous. There was also a high incidence of non-compliance with other relevant guidance (including A4e’s own processes).
“The process established prior to March fell significantly short of our expectations. As a result, the department has concluded that continuing with this contract presents too great a risk and we have terminated the Mandatory Work Activity contract with A4e for the South East.”
Mr Grayling added that “contingency plans” were in place to ensure “continuity of support for participants”.
But the company welcomed the “positive findings” of the Department for Work and Pensions’ audit, and another by the Skills Funding Agency, saying: “Both confirmed they identified no evidence of fraud, systemic, attempted or otherwise, in relation to any audit completed of the contracts they hold with A4e.”
Chief executive Andrew Dutton said: “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.
“Our immediate task is to further enhance our controls to cement our position as a trusted provider of front-line public services.”
A4e started in South Yorkshire more than 20 years ago to provide retraining to large numbers of Sheffield steelworkers who became redundant when the industry started to decline.
Its former chairman, Emma Harrison, was appointed by Prime Minister David Cameron to be the government’s “family champion” in 2010. She resigned from that role, and the chairmanship, in February.
