The Department of Work and Pensions (DWP) has announced a review of skills firm A4E’s welfare-to-work contracts, in light of allegations of fraud.
In a statement released on 9 March, the DWP said it had “begun a formal, immediate investigation” of the allegations, and was commencing an audit of “all our commercial relationships” with the firm.
It added that: “if at any point... we find evidence of systemic fraud in DWP’s contracts with A4e, we will not hesitate to immediately terminate our commercial relationship.”
The warning related to employee allegations that jobless people sent on one welfare-to-work contract had been ordered to sign blank timesheets.
In a statement A4e said it would cooperate fully with the investigation: “The board has made consistently clear in all previous statements that we take any allegations of fraudulent or otherwise illegal activity extremely seriously. There is absolutely no place for this type of misconduct at A4e.”
A4e was founded to help re-train former steelworkers in and around Sheffield, and is largely dependent on government contracts.
But the firm’s work has recently come in for substantial public criticism, as MPs questioned the value-for-money that the high dividend payments made to its directors represented.
In February, the group’s chairman and founder, Emma Harrison, stepped down. A former civil servant, Sir Robin Young, has been appointed as the non-executive chairman.