DWP Central Freedom of InformationAnnex A Team

e-mail: [email protected]

Our Ref: FOI 0059 4 February 2013 Annex A

Dear Mr Owen

Thank you for your Freedom of Information request which was received on 06 January 2013. In that request, you asked:

In May 2012, the BBC reported that Employment Minister had terminated contracts with A4e, stating that continuing the contracts with the company would be "too great a risk".

I am requesting information on which contract(s) were terminated, and the reasoning behind those decisions. Furthermore, I am requesting information on all current contracts the government holds with A4e, any decisions (and the reasoning behind them) to terminate those contracts or not renew them which have been made since the start of the , and any new contracts (and the reasoning behind the choice of A4e for those contracts) which have been signed since the decision to terminate the previously requested contracts.

The contract which the BBC referred to was the A4e (MWA) contract in Contract Package Area 1 (South East). The reasons this contract was terminated were as follows. In March 2012, the Department of Work and Pensions (DWP), was made aware of an allegation in respect of the MWA programme run by A4e in the South East. Consequently, the Department’s Internal Audit and Investigations team undertook an audit of its commercial relationship with A4e. Supported by Ernst and Young, they examined the controls operated by A4e’s on all its current DWP contracts.

The audits for the Work Programme, the New Enterprise Allowance programme and MWA contracts with A4e found no evidence of fraud in any of these contracts. However, it identified significant weaknesses in A4e’s internal controls on the MWA contract in the South East. The documentation supporting payments was seriously inadequate and in a small number of cases the claims were erroneous. DWP investigators were satisfied that the erroneous claims were attributable to inadequate procedures rather than fraud. 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 DWP’s expectations. As a result, DWP concluded that continuing with this contract presented too great a risk for the Department so the A4e MWA contract for the South East was subjected to uncontested unilateral termination.

Moving on to the next part of your request, the tables below show information on all current contracts the DWP hold with A4e. With the exception of the MWA contract mentioned above, DWP has not terminated any A4e contracts or failed to renew contracts up for renewal, since the Work Programme started in June 2011. The DWP has not signed any new contracts with A4e since the MWA contract was terminated.

A4e Work Programme Contracts

Contract Package Location Contract Start Contract End Area (CPA) Date Date CPA 2 East Midlands 01 June 2011 1 April 2016 CPA 4 London East 13 June 2011 1 April 2016 CPA 6 North West 13 June 2011 1 April 2016 CPA 9 South East 13 June 2011 1 April 2016 CPA 17 South Yorkshire 13 June 2011 1 April 2016

A4e Support Contracts

Contract Package Location Contract Start Contract End Area (CPA) Date Date CPA 2 Black Country 7 December 2009 6 December 2014 CPA 10 Nth, Mid & SE Wales 7 December 2009 6 December 2014 CPA 12 South Yorkshire & 7 December 2009 6 December 2014 Derbyshire CPA 16 Hamps/IoW, Berks, 7 December 2009 6 December 2014 Bucks & Oxfordshire CPA 23 West Yorkshire 7 December 2009 6 December 2014 CPA 24 London 7 December 2009 6 December 2014

It may be helpful if I explain that all DWP contracts are primarily let using fair and open competition. Providers for the Work Programme were selected from the Framework for the Provision of Employment Related Support Services. Inclusion on the framework was as a result of fair and open competition. Full details of this process are on the DWP website at the following link: http://www.dwp.gov.uk/supplying-dwp/what-we-buy/welfare-to-work- services/framework-for-the-provision/

If you have any queries about this letter please contact me quoting the reference number above.

Yours sincerely,

DWP Central FoI Team

------Your right to complain under the Freedom of Information Act

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