Good morrow fellow idlers of Team GB. Last week I thought I’d be writing several political obituaries but, as they say, a week is a long time in politics. As the dust settles in the Westminster Comedy Club, following Team GB Dave’s comic cabinet shuffle, what’s really changed? Some are left out to hang, while others climb the greasy pole. Some will shamefully continue making absolute ‘Hunts’ of the job, while others take on the mantle of their predecessors; blaming Labour for their
party’s shame. But one stood firm, the quiet man who said no to change, refused to leave his post like the officer and gentleman he is!
Back in 2002 we had an economy and proper jobs, food banks were a third world phenomenon and the Wonga had yet to replace the pound. At his party conference speech, Iain Duncan Smith suggested we “not underestimate the determination of the quiet man”. It was about that time IDS formed the ‘Centre for Social Justice’; a right wing think-tank designed to tackle social exclusion and poverty. How ironic that, ten years on, the Institute for Fiscal Studies observes a rise in repossessions, impoverishment, and people using Wonga loans to pay the bills. So what flag is the quiet man waving now, and what does it say apart from “no thanks Dave, I’m not moving - I can bugger this up all by myself”? Does IDS really think his vision of Welfare to Work and Universal Credit will solve every economic woe? In May of this year, the government teased us with a revised forecast for people undertaking the forced ‘Welfare to Work’ programme. The revised prediction dropped 43% to 1.4 million. So where did those feckless types go if they weren’t reaping the benefits? They can’t all be in work; the figures don’t add up. Those earlier predictions forecasted 2.6 million eligible souls going through the W2W debacle, believing the private sector would take up the slack and provide jobs for
Despite the refusal of Iain Duncan Smith’s Department of Work and Pensions to actually publish accurate information, the figures on the ground are much lower, with providers struggling to keep on target and sub-contractors going out of business. Such predictions now seem foolishly optimistic, and the level of trust in the providers’ honesty unbelievably stupid.
In June 2012, long before Dave’s re-shuffle, that renowned oracle for statistics and accuracy, Chris Grayling, proudly announced 28,600
people were on W2W. Of that figure, 7,000 had a continuous break off benefits of 13 weeks or more, thereby calculating a 24% success
rate for W2W. Somehow he forgot to add the number of souls thrown off the scheme and, unfortunately for Chris, about the same time
Corporate Watch published their research into the increasing number of sanctions, this being where the DWP is asked to stop benefits
altogether for refusal without good cause to co-operate. In the first eight months of W2W, Job Centre Plus agreed to 40,000 of the
requested 110,000 sanction requests from W2W contractors.
In 2009 sanctions such as these had peaked at 130,000 cases, while in April 2011 they had risen to an astonishing 500,000, which suggests W2W providers are more interested in punishing claimants than helping them. This was despite pocketing the initial 500 Wonga fee for signing them up. Obviously Grayling’s penchant for punishment and statistical accuracy has stood him in good stead, enabling the minister to concentrate on future prison reform instead. We can now expect the prospect of Prison-run call centres, appropriate if the unemployed are already criminalised. Back to the stats. Between June 2011 and January 2012 ‘Working Links’ referred 11,910 cases for sanction and the DWP agreed to 6,210. A4E (remember them and their unusual business practices?) referred 10,120 cases and got 3,000 through. Corporate Watch’s figures broke down all the W2W contractors’ sanction requests to show that the providers actively removed a large number they had been paid handsomely to help. Or, to put it another way, if 6,210 people are sanctioned, despite the provider having claimed 3,105,000 taxpayers’ Wongas in attachment fees, by reporting these alleged offenders, they no longer have to spend that money on training or resources.
But what does IDS hope to gain from the misery of others? Well, boosting the percentage rate of success by claiming positive
outcomes makes the Government look good; like W2W is actually working. Succumbing to the temptation to sanction claimants
also keeps profits on target when the original uptake predictions are no longer workable. As the old “blame the poor for their own
situation” diatribe fast becomes a hackneyed distraction, the refusal to publish actual figures under a bogus commercial
confidentiality acts as a convenient smoke screen.
Who wouldn’t by confused by all of this, particularly when the National Audit Office says one thing, IDS says another, and the
W2W providers refuse to say anything at all? It's obvious the whole thing isn’t going to plan, so what can the W2W providers do to improve take up on their programme,
the subsequent statistics and, more importantly, their profits? As the October 2012 deadline approaches for the publication of the W2W outcome figures, we can expect the next Tory budget to blame everyone but themselves. Welfare will be cut further to beat up the poor, and to hide the absolute criminal shambles that is manifest in W2W outsourcing. Expect Team GB Dave and Osborne (‘The Sultan of Stinge’) to come up with more half-baked schemes to conceal the mess they’ve created while blaming the previous lot or Johnny Foreigner. It’s a shame Circus Boris trumped them all from a high wire while rolling out his new London workfare idea. All Dave can do is shamelessly jump on the Team GB bandwagon while his cronies profit from the marketisation of the state.
But behind the spin there is a storm brewing no amount of cabinet shuffling, trapeze acts or Olympic sycophancy can resolve.
Both Dave and George know it will see them out of office in 2015, leaving this country in economic ruin looking to Greece for a
bailout. In the meantime, the truth behind who really gains from W2W slowly seeps out. We already know about the dubious
dealings of A4E, so let’s leave Emma Harrison in her mansion (bought with taxpayers’ Wonga) for now. We think we know about
G4S, but despite the public apology, nothing has officially explained why they fucked up so badly when paid to provide Olympic
martial law. So, in an effort to gain some enlightenment, let’s take a sneaky peek at a prime example of the W2W provider -
John Nash, Ryan Robson and three others set up sovereign Capitol in 2001. For the past eight years it has owned the Employment Skills Group, a training company with £73 million in juicy government contracts. On Monday July 23rd 2012, ESG was sold to an Investment Bank for an undisclosed sum. Prior to this, back in May 2011, ESG received two very lucrative contracts from Iain Duncan Smiths’ DWP for providing the Work Programme in Warwickshire and Staffordshire. This deal expires in 2016 and is worth over 69 million in juicy
ESG was chosen to run a Mandatory Work contract across the West Midlands to find work for 5,000 people over a four year period, and received a very welcome 800 Wonga bonus for each
claimant forced into work. Not even Wonga (the upmarket loan sharking lot - not our new currency) can screw this much out of
people for doing nothing. Notice how we, the taxpayers, pay for this. Johnny Nash may be the Tory’s ideal posterboy as an
entrepreneur, but a more detailed inspection of his past raises more questions than business insights. Since 2006 Nashy has
generously donated 182,500 Wongas to the Tory party, and he has been appointed to the Department of Education’s Board by
Michael ‘Mr Chips’ Gove. This while remaining a non-executive director of Sovereign and, as luck would have it, a member of the
‘Independent Challenge Group’ which advises George Osborne.
Then there’s Ryan Robson (left) who left Sovereign in March 2011 and was the director of ESG between October 2008 and December 2011, back when they were awarded the multi-million Wonga contracts by IDS. By some miraculous coincidence, Robson is also a director of the ‘Centre for Social Justice’, a think tank set up by IDS. Robson has donated 267,866 Wongas to the Tory coffers since 2003, plus the much criticised donation of 21,000 Wongas to a very recently ex-health minister back when he was in opposition (Robson being chairman of private health firm Care UK at the time). All this seems rather ripe, when one considers the Tory Free Enterprise Group's recent comments that British workers are the idlers of the world. Presumably that’s compared to our rank political get-rich-quick opportunists. So W2W is not simply about forcing the workshy and the feckless to get a job instead of poncing off the rest of us (even though there are no real jobs out there). It’s about making the rich richer at the expense of the poor. Who would have believed it?
It gets worse. Outrageous as this may seem, some W2W sub-contractors also have a European Social Fund Contract, Lottery Wongas, or contracts with FE colleges to help fund work searches and the gaining of qualifications. Payment is by outcome or qualification, so a provider can double up their Wonga income. Also, when a sub-contractor has a public service contract (e.g. security at an international sporting event), they can mandate people on W2W, or cherry pick W2W participants from their own contracts and collect double outcomes. This would strike most as criminally immoral, but it is in fact legal. Even if the workforce fails to turn up, and the army has to fill the gap, there is no law against the practice or way to find out what went wrong. The provider can always pull the old ‘commercial confidentiality’ scam, despite being funded from the public purse.
However, the Golden Goose for W2W contractors are the job-ready candidates; those who would have found a job
without harassment. With fewer opportunities, and a large number of claimants ‘parked’, why waste cash giving
intensive support when censure can up your results? The most lucrative way for these organisations to help the
worst off find work is by doing bugger all. So why put effort into those unlikely to find a job in the present
employment climate? Why keep them on the books, thereby making your percentages look bad, when you can
sanction, send them off to mandatory workfare, or encourage them to work the benefits system by becoming
Ahh.... the myth of workfare. Despite Tory claims of work experience and a foothold in the job market, workfare
achieves nothing but free labour for an employer while the individual gets shafted. Workfare does not improve your
job prospects. If anything, recent figures suggest it drives you back to benefits but mentally ill this time; claiming ESA instead of JSA. Workfare exists to help W2W contractors suck up unpaid jobs that could have paid the wages of job-seekers and saves them having to spend anything on training or resources. W2W contractors can also play at being employment agencies, forcing candidates to attend group interviews for businesses who were going to hire through Job Centres anyway. If they get a job the contractor receives another outcome, while the employer gets free labour and the employee has no employment rights, the taxpayer once again footing the bill. Here the unemployed are treated as voiceless assets to exploit.
The other method to up the W2W outcome is hinted at in the government’s own figures which show a huge increase in the self-employed. This is due, in part, to W2W sub-contractors encouraging claimants to follow this route. Here the contractor can claim an outcome for every candidate signed off to self-employment, while the claimant is no longer under threat of sanction, mandatory placement or workfare. If their self-employment return is not enough to live on, no worries - working tax credits
will make up the difference. WTC are payable to the self-employed at 20 Wongas a week under dole money rates. You don’t have to sign on or earn anything to claim it. Yet when Duncan Smith’s Universal Credit scheme is introduced all the rules will change. Under Universal Credit, the self employed have to prove they are working the equivalent wage of a 30-hour week on their self-employed business to qualify. If you can’t then look out. HMRC will decide you aren’t self-employed and ask for their tax credits back. I somehow doubt IDS really thought this one through, since it raises the prospect of returning thousands to the dole queue with massive amounts of debt. But it’s obvious the W2W contractors don’t care, just as long as the cash keeps rolling in. No wonder the quiet man is keeping quiet about this.
When Universal Credit kicks in, many of the 10.1 million adults of working age living on a low to middle income (between 12 and 30k a
year) in dead end part-time jobs, self-employed or on commission, will lose their benefit support. Universal Credit, the system designed
to incentivise the unemployed into work, will have the opposite effect. Additionally, by April 2013, Council Tax Benefit will no longer be
funded by central government. The Tory Party project of shrinking the state continues, letting others suffer for their own ideology.
Individual councils will be left to find the 20% shortfall, devising schemes to cut council tax benefit as the reduction in income tax for
the very rich comes into effect. It is estimated the drop in council tax benefit affects 800,000 low wage earners who will soon realise
they’re better off on the dole than working. Let’s see how the child poverty predictions stack up in 2015 after years of Tory cuts to the
poor. One indication came last week, with Child Poverty Action announcing its focus has switched from overseas to the UK.
The current tax credit system serves to fill the shortfall for employers paying their workers low wages. These days, taxpayers aren’t supporting the feckless and workshy so much as providing profits for businesses; effectively state subsidies. The W2W programme doesn’t create jobs, it exploits people. The only ones to benefit are contractors such as Sovereign Capitol (now owned by investment bankers). Giving unpaid workers to business only serves to dehumanise the poor, bugger the economy further, and make certain Tory backers very rich with public money. The Universal Credit scam will do further damage, plunging many working families into destitution.
After the release of the October W2W results, expect a government push to remove employment rights from those still in a job. The Tory austerity plan was never about sorting the economy or balancing the books, it was about exploiting this country for No wonder IDS refused the promotion. He knows the pending magnitude of his Universal Credit cock-up, yet foolishly thinks he can still make it work if only the pesky civilians and lower ranks will do as they’re told. Osborne and Cameron must know it too, why else would they offer IDS a different job if not to put someone in place who can sort out the burgeoning mess, as they have in the department of health? By staying on the burning deck of welfare reform, IDS can ensure the statistics say what he wants, at least for now. I, for one, can’t wait to hear the excuses rolled out in October to explain the failures of W2W. But rest
assured, the unemployed will shoulder the blame, even while outsourcing continues to rip us all off.
IDS may well have made his last political stand, not so much defending the flag as flogging it off to the highest bidder. No doubt
he can get an executiveship at one of his mates’ companies should things go badly. Someone, somewhere will give him work,
perhaps in outsourcing. No one should underestimate the determination of the quiet man, even if he is soon to be drowned out
by shouts of “liar, liar, pants on fire” from the opposition bench, public, and those he has condemned to no-pay workfare
drudgery and a life of penury.