Bidders Take Fright

Remember this from last week:-

Rob Allen quote "one told me recently only one thing more worrying than losing out in the bidding process - that was winning the contracts"

Well sure enough, Geo took fright and decided to give it a miss. Winning the probation contract for Warwickshire West Mercia was so good an opportunity, they decided to walk on. Of course those canny MoJ spin doctors don't quite tell it like this. In fact if you believe in fairy stories you'd think there was no problem at all with bidders getting cold feet or not bowing to MoJ demands:-

Transforming Rehabilitation programme - preferred bidders update 

Geo Mercia Willowdene (GMW) was selected as the preferred bidder to run offender rehabilitation in Warwickshire and West Mercia as part of the Government’s reforms to probation. This consortium includes Geo Group UK, Willowdene Rehabilitation (a social enterprise) and Mercia Community Action (probation staff mutual). We have not been able to reach an acceptable agreement with Geo Group UK. 

The Ministry of Justice is determined to secure the highest quality outcomes in reducing reoffending. 

There was strong competition in this contract area and we have now begun discussions with EOS, who also submitted a highly credible bid, and they have now been designated as the preferred bidder for this region. EOS is currently in discussion with both Willowdene Rehabilitation and Mercia Community Action about the opportunity of working in partnership with them. 

Discussions are now taking place with EOS in preparation for contract award. The overall programme for awarding contracts in 2014 remains firmly on track and we expect providers to be in place and delivering services by early 2015.

Notes:

EOS is part of the Staffline Group of companies. It is an organisation with a strong track record at helping improve the lives of disadvantaged people. In the past five years they have helped over 50,000 individuals overcome issues including offending, health, employment, skills, finances and relationships. 

It's bullshit. They know it. We know it and they know we know it. EOS cannot deliver on the 2 dimensional Work Programme contract. Probation is infinitely more complex. They are being set up to fail by a failing Ministry.

MoJ say EOS now preferred bidder in WM area with Mercia and Willowdene still in play. Clearly the issue here and elsewhere is that the big boys are providing the CASH and the poor mutuals are merely sub contractors - another lie by Grayling. If the bid was good they should have let Mercia and Willowdene continue as a mutual, but they can't because they need the money from the prime. EOS - out of the Staffline stable. Can get you staff for the warehouse at a moments notice. Know f**k all about probation.

It looks like there's been some recent changes:-

Staffline, the national recruitment and outsourcing organisation providing people and operational expertise to industry, is pleased to announce that it has conditionally agreed to acquire Avanta Enterprise Limited (“Avanta”), a leading provider of Welfare to Work and skills training services across the UK.

On completion of the Acquisition, Staffline’s existing Welfare to Work business, EOS, will be merged with Avanta.

Am in WWM area & as I understand it from emails the staff mutual & Willowdene are out completely. Only one preferred bidder now.

EOS - like putting a Leyton Orient FC player in the champions league - sorry Andrew couldn't resist!

A very poor provider of Work Programme provision. Suspect even poorer at probation stuff. A real sign of desperation when Capita and Sentinel in the same pot! Presumably all are poor and MoJ scraping the barrel. What must that do for the poor staff in CRC knowing they are auctioned off like E Bay stock?

This makes even more nonsense of the specious title "preferred" bidder as if quality or standards had anything to do with it. Looking more like "anyone we can press gang into it."

How can you be a "preferred" bidder when your selection is because the MoJs first choice walked away?

"As the leading provider of the Work Programme across the West Midlands, EOS is committed to delivering first-class services to return the longer term unemployed back into sustainable employment.

Alongside our partner organisations we draw on both our experience of working with the Department for Work and Pensions, and acquired expertise from Staffline, to provide a ground-breaking and highly effective approach to reducing worklessness. EOS operates six established Employment Centres which sit at the heart of this approach by offering jobseekers practical, sector-specific experience of working in various professional directions."

What utter bollocks. The government cannot even get this right. Looks like names are again being picked out of a hat. The staff there must be thinking oh "f..." what's going on. THIS IS NOT A GAME GRAYLING. We are already demoralised and bewildered with the changes. Don't add to our worries and make a mockery of it. The shafting just does not stop. All those allocated to the CRC should be compensated. We have been treated unfairly and its a disgrace that the unions have allowed this to go on.

Those MoJ bods must be squirming. They know it's an almighty f*** up but have to front it out. Excruciating!!

If you can't sell a TR contract what do you do? Go back and give it to one of the original unsuccessful bidders!!

This on the London South East website:-

Staffline Group PLC was named a preferred bidder by the Ministry of Justice on Friday to provide provide probation and rehabilitation services in Warwickshire and West Mercia, after the government was unable to reach an agreement on the contract with US outsourcing company Geo Group Inc.

Staffline said its EOS subsidiary will manage the delivery of all probation and rehabilitation services to low and medium risk offenders in the region as part of the MoJ's Transforming Rehabilitation programme. Geo's Geo Group UK arm had been named as the original preferred bidder for the contract, as part of the Geo Mercia Willowdene consortium alongside social enterprise Willowdene Rehabilitation and probation staff-run mutual Mercia Community Action.

"We look forward to working alongside the probation and rehabilitation services to support the broader community in Warwickshire & West Mercia," said Staffline Chief Executive Andy Hogarth. 

The contract win marks a turnaround for Staffline, which had originally bid unsuccessfully for four contracts in the programme. Shares in the group dropped on the news it had not won any contracts when the original announcement was made at the end of October.

The MoJ named the preferred bidders for all 21 of the rehabilitation services contracts then, with Interserve PLC the only UK-listed company to have won a place on the programme. Liberum, which at the time said the unsuccessful bids for Staffline, Capita PLC and Carillion PLC were negative for those companies, said the win for Staffline now will broaden the recruitment company's offering.

The broker said it retains its Buy recommendation and 1,062 pence target price for the stock, saying that while it is leaving its earnings estimates unchanged, the new contract should broaden Staffline's business, reduce its contract concentration and should contribute around 4% to profits once fully implemented.

Though the Warwickshire & West Mercia portion of the MoJ contracts is among the smaller mandates, with an indicative value of GBP11.6 million to GBP14.2 million against an average per region of around GBP20 million to GBP25 million, it does diversify Staffline's contract exposure, formalises its relationship with a new government client, and will begin to mitigate the risks for when the current Work Programme contract comes to a close in 2016.

Liberum said it will leave its profit estimates for Staffline unchanged for the time being, but said it expects the contract will generate around GBP1 million per year to profit once it matures in 2016.

GEO won't be the last bidder to jump ship and stick two fingers up to the MoJ. Twitter yesterday:- "Am hearing it will not the last...potentially another next week.”

While we're on the subject of the Work Programme and how well EOS reckons to be doing, the chair of the Public Accounts Committee Margaret Hodge seems to take a somewhat different view by saying the Work Programme isn't working:-

The Department has not succeeded in incentivising Work Programme providers to support harder-to-help claimants into work. Almost 90% of Employment and Support Allowance claimants on the Work Programme have not moved into jobs. 

Evidence shows that differential payments have not stopped contractors from focusing on easier-to-help individuals and parking harder-to-help claimants, often those with a range of disabilities including mental health challenges.

Data from Work Programme providers shows that they are, on average, spending less than half what they originally promised on these harder to help groups. It is a scandal that some of those in greatest need of support are not getting the help they need to get them back to work and are instead being parked by providers because their case is deemed just too hard.

The Department must do more to encourage providers to work with harder-to-help groups by tackling poorly performing prime contractors and sharing information on what works. It should also collect and publish information from each provider on how much they are spending on different payment groups.

Of course along with EOC, other Work Programme 'Primes' have their snouts in the probation trough like Interserve and Seetec, the latter getting a special mention from Margaret Hodge:-

We are also concerned about how the Department’s sanctions regime is operating. Sanctions can cause significant financial hardship to individuals, and it is not clear whether the sanctions regime actually works in encouraging people on the Work Programme to engage with the support offered by providers.

Feedback from some constituents suggests that the number of sanctions has been increasing and that some providers have been recommending sanctions more than others. The Department confirmed that Seetec has referred more claimants for sanction than other providers. 

The Department should monitor whether providers are making the right sanction referrals to the Department and that they are not causing unfair hardship. It should publish the number of sanctions by provider.

With this track record, things don't bode well for Seetec having an understanding approach to the needs and challenges of probation clients. Further evidence is provided in this Guardian article of a couple of days ago:-

In December 2012, Catherine Hale, 44, who has suffered for many years from severe ME was placed in the work-related activity group of ESA and referred to a jobcentre. “I brought a copy of the report from my work capability assessment (WCA)… it explains what my problems are and she [the jobcentre adviser] said ‘Oh, I can’t look at that dear, I’m not even qualified to put on a sticky plaster’. She just didn’t want to know.”

Six months later the referral letters started to arrive inviting Hale to attend an interview at a Work Programme (WP) provider to discuss what employment may be suitable for her. “Each letter came with a threat attached that if you do not turn up your benefit will be affected”, says Hale. “The first time I was supposed to go I was really poorly and could barely get out of bed. I was aware I had to phone them up. They were all really rude and didn’t pass on your messages. There was no compassionate human being in the system at all. I had a kind of breakdown from the anxiety. There was something about being framed as a worthless, feckless, good-for-nothing that left me feeling persecuted and empty of self-belief.”

Hale says she got a letter from Seetec, the WP provider, saying that the centre she had to attend for her interviews had moved to Woolwich [south London]. “I looked it up and it involved taking two trains and walking almost a mile. I advised them my WCA said I can’t walk more than 200 metres and requested adjustments. I never got any reply to that letter or any other letter I’ve ever written to Seetec,” she says. “Then I started getting letters mandating me to four-hour workshops three days a week for four weeks in a row. My WCA report says I can’t sit for more than an hour without pain or discomfort so I wrote and pointed this out.”

According to Hale, Seetec reported her to the DWP for failure to attend on five occasions. “Each time they report you the DWP writes to you and gives you seven days to give a good reason for not attending which effectively is three days by the time the letter gets to you and you post it back. I’d point out that my disability is not in dispute because they’ve got my WCA report. I’d written requesting adjustments and hadn’t had any reply.”

In March, Hale says she was sanctioned but didn’t receive a letter to tell her. Her benefit was cut by £71.70 per week. Hale had telephone interviews with Seetec so she “recomplied’’ with the programme. The adviser should have alerted the DWP that she had re-engaged. Hale’s solicitor advised her she had a very strong case of discrimination under the Equality Act 2010 and would have a high chance of success in a county court, but this would probably come with a confidentiality clause. She chose instead to talk. In August, Hale was reassessed and put in the support group of ESA where she is not expected to work.

Seetec said: “We are aware of the issues raised and are working with the DWP to gain a clear understanding of Ms Mollona’s [Hale’s married name] experience.”

As an aside, the sanctioning figures nationwide are staggering, as this report has discovered:-

The Oxford University study led by Professor David Stuckler and Dr. Rachel Loopstra, is in the process of analysing what has happened to the 4.5 million people who have been sanctioned under the Coalition government's sanctioning regime.

Anyway, back to the PAC and Margaret Hodge, it's to be hoped the MoJ have better contract-writing skills:-

The Department has designed the contracts with providers in a way which exposes the taxpayer financially. Underperforming providers may still be able to claim bonus payments for 2014-15 because of the flawed performance measure whereby the fewer clients referred to a provider, the better their performance looks. This may include Newcastle College Group whose contract has been terminated.

The Department must make every attempt to claw back the estimated £11 million of inappropriate payments. After a slow start, performance of the Work Programme is improving, but there is still a long way to go before it is working effectively for all.

Here's something in the Daily Mail that Staffline in particular might like to think about as they celebrate getting an unexpected second chance at a probation contract. A contributor from yesterday nicely summed up the issue:-

Bidders may like to read this article. With the TR contract also comes all the liabilities. Claims wont be against the MoJ, but against those with the contract. Hope you've remembered to cost it into your bid!

Criminals raking in thousands of pounds in compensation for injuries suffered during community service

A criminal has been awarded a £19,000 taxpayer funded compensation payout after he hurt himself clambering over a gate during unpaid work.

The settlement is part of an estimated £500,000-per-year of compensation payments made to offenders who slip and fall during their community service. The unnamed criminal in West Mercia was handed a compensation cheque for £19,773 when he was injured in a fall as he tried to climb over a wooden gate while doing his unpaid work.

While in Humberside a total of £2,400 was paid to an offender who fell off a ladder and then claimed he hadn't been given proper instructions on how to use it. Probation services can be made to pay out if it is shown that they were negligent in that they didn't supervise the criminals properly, such as warning them about dangers or providing them with appropriate equipment.

In South Yorkshire a criminal doing community service was paid £1,300 after he hurt himself lifting equipment onto a trailer. The legal costs in the case added another £8,250 to the bill for the probation service. An offender doing a work placement in London was paid £11,000 after a heavy concrete object fell on their foot. The criminal won their case on the basis that probation workers didn't provide enough supervision.

There were also payouts of £4,000 to an offender by York and North Yorkshire Probation Trust and £10,500 to a criminal by Wales Probation Trust for injuries sustained while doing community payback work.

Probation staff also managed to sue their employers for damages when things went wrong. One claimed £12,000 after being attacked by an offender while in Wales £11,000 was paid to a member of staff hurt while at work. Devon and Cornwall Probation Trust paid £150,000 to a former staff member who successfully said that working conditions had caused them psychiatric damage. 

The Trust also paid £6,000 to another employee who hurt their knee getting out the back of a van. In a previous year it was reported how one criminal picked up £73,000 in compensation after they sprained their ankle while clearing brambles. 

Across the whole country it is estimated around £500,000-per-year is being paid by probation trusts to settle compensation claims brought against it by criminals and employees.

Lets round this off with a few other things bidders might like to consider before it's too late. Firstly this:-

I recall reading that contracts stipulated that any intellectual property developed within CRCs would automatically become property of NOMS - presumably to force this sharing of the supposedly innovative good practice? Can't imagine anyone developing a new programme within a CRC would be happy about this.

Secondly, Napo has filed the papers for Judicial Review, as reported here:-

Last night Napo’s lawyers formally filed the necessary documentation in the High Court to seek Judicial Review (JR) of Justice Secretary Chris Grayling’s plans to award CRC contracts to the preferred bidders under his Transforming Rehabilitation plans on or after the 1st December 2014.

Finally, the ever-present risk of serious reputational damage that might arise from a dreadful case such as the appalling murder reported here in the Daily Mail. We don't know all the details, but the guy seems to have been released from a five year sentence and may well have been regarded as 'low or medium risk' and allocated to a CRC. 

Bidders need to remember that evidence shows that most Serious Further Offences occur amongst this group, not the 'high risk' group hived off to NPS.

Our thoughts go out to everyone involved, the probation staff, the victims family and friends and the police officers who found themselves faced with such a hideous scene. I sincerely hope support and counselling will be available to all. 'Probation' can be a very disturbing and unsettling business.