Wednesday, 16 September 2015

TR Latest News 3

This from the Guardian:-

How sustainable are charity contracts for public services?

Think of it as a £2bn reality check. That’s probably what charities have lost over the past five or six years in terms of reduced net income from contracts for delivering public services.

It’s a far cry from some of the giddy growth forecasts that were still being made even as austerity kicked in. As recently as 2011 Tory peer and sometime government “big society” adviser Nat Wei was predicting that the value of payment-by-results contracts to voluntary organisations could rise to £60bn a year, dwarfing any revenue lost through cuts in conventional funding.

As it is, charities’ total revenue from national and local government bodies is at its lowest level since 2007-08. According to voluntary sector umbrella body NCVO it stood at £13.3bn in 2012-13, with income from contracts and fees accounting for 83% of that. This figure is down £1.7bn from 2009-10. The corresponding preliminary estimate for 2013-14 is £12.9bn total revenue, pointing to a £2bn drop in contract and fee income since 2009-10.

When you combine that with the high-profile collapse of Kids Company, and the far lower-profile but arguably more alarming closure of adoption and fostering charity BAAF, it seems clear that the sustainability of the contracting model is under strain.

You might not think so, however, when you look at the latest report and accounts of one-time criminal justice charity CRI (Crime Reduction Initiatives). The organisation, which has become a byword for relentless – some would say ruthless – growth through competitive tendering, has just posted another remarkable set of figures: a 21% rise in income in 2014-15. The charity has hit a new high of £141m, with an operating surplus of £1.2m and cash balances at year-end of almost £23m. A rebrand and likely name change are pending, to confirm the operation’s development into what chief executive David Biddle calls “a broader healthcare charity”.

Formed at the turn of the century but comprising several older charities, CRI has excelled at winning contracts for substance misuse and offender services and is now making inroads into social care, mental health and public health. It works with 120,000 people a year across England and Wales and employs almost 2,400 staff.

Biddle denies that the strategy is one of growth at all costs. “There is no point in going for work we don’t have the competence for, or the capacity, or the capability to deliver,” he says. “That does the reputation of the organisation no good, the reputation of the sector no good, and above all it does the service-user no good. We turn down far more opportunities than we go for.”

Provided the charity feels it can make a positive impact, however, and the work squares with its charitable objects, then nothing is considered off-limits. It is currently considering work around child sexual exploitation. “Some of the issues facing the people we work with are pretty dire. If we believe we can come up with solutions, it would be wrong – plain wrong – not to see if we can make their lives better.”

Criticism of CRI for squeezing out small, local charities is misplaced, Biddle insists. “It’s unfair because we actually work with smaller organisations: what they do is incorporated into our offer. It would be foolish to bypass their special strengths at community level. A much better approach is to support them with some of our planning and approaches, some of our infrastructure and some of our technology systems.”

Is CRI’s success story exceptional? After all, Action for Children, which is also funded largely by public contracts, has recently reported a further fall in annual income to £173m in 2014-15, compared with £208m in 2006-07.

Karl Wilding, NCVO’s director of public policy, thinks that a small number of big charities will continue to make a good living out of public service contracts. To do so and to retain their values base, however, they will need to be acutely aware of the risk of “institutional isomorphism” – being pressured by service commissioners to talk and behave in corporate ways, like the for-profit outsourcing companies they are competing with, and lose the distinctiveness that charities bring to the table.

For all charities, though, Wilding believes that the contract agenda is going to shift decisively from simply delivering care and support. “It’s going to be much more about how we find new models to reduce demand for services, through prevention and early intervention,” he says. “The big issue is who and what pays for that.”

One big charity embracing the search for such new models is Catch22, which works with at-risk young people and has annual revenue of about £55m. It has awarded a fellowship to Charlie Howard, award-winning founder and director of another youth charity, MAC-UK, to give her time and space away from the job to think, create, lobby and influence.

Chris Wright, Catch22’s chief executive, says: “I was first drawn to Charlie because her mission was so radical. She was trying to fundamentally change a system, to shake things up and change the way things are done. It became clear to both of us that there was a role Catch22 could play in supporting this ambition. So far, I am really proud of what we have achieved together.”

This from the Independent:-

Concentrix: Controversial US firm to be sole collector of court fines for Ministry of Justice

An American outsourcing giant criticised for its controversial pursuit of benefit recipients on behalf of the tax office is set to become the Ministry of Justice’s debt collector, The Independent can reveal.

Concentrix is understood to be the only company being considered by the Government for a £675m contract to collect court fines. The deal would include pursuing those who are struggling to pay the contentious criminal courts charge – a fixed-fee penalty imposed on all convicts, irrespective of their means.

More than 50 magistrates have quit in recent weeks in opposition to the charge in England and Wales. Critics say it encourages poor people to plead guilty, because the fee can be up to 10 times higher if they are convicted after pleading not guilty.

The choice of Concentrix to collect court debts has surprised many, given its performance in a contract with HM Revenue and Customs to pursue fraud and error detection. The Independent revealed earlier this year that Concentrix had sent speculative letters to thousands of people on low incomes accusing them of cheating on their tax credits.

The act was described as a vast “fishing expedition,” but Concentrix says it was just acting within HMRC guidelines. A spokesman for the company defended its record: “Checks are carried out only where there is an indication that a tax credits claim may be incorrect and last year checks by HMRC led to corrections of more than £700m. Suggestions that this process is a random exercise are simply incorrect.”

The company has also been questioned over its efficacy in the HMRC contract. The National Audit Office criticised Concentrix this summer for only making savings of £500,000 in the first year of investigating tax credits, despite estimating the savings would be £285m. Concentrix says the figure does not represent a full year of the contract.

The privatisation of court debt collection – which will include the use of bailiffs – has already prompted outrage from MPs and campaigners, who fear a private company would use more aggressive tactics. Michael Gove, the Justice Secretary, signed off on the business case for privatising the collection of court debts in July but has refused to share the details. MPs have asked to see it but the minister has pleaded commercial sensitivity.

Court debt collection is currently carried out by the National Compliance Enforcement Service (NCES), which brought in £518m in fines, penalties and confiscation orders in the year 2013-14.

MPs signing an Early Day Motion opposed to its privatisation, point out the service has continued to improve collection rates despite cuts to staff and resources.

Lord Falconer, the shadow Justice Secretary, said: “This has the makings of yet another disastrous privatisation from the Ministry of Justice. Clearly, it has learned nothing from the failure of the Serco and G4S tagging contracts or from the failure of the Serco and G4S tagging contracts or from the reckless privatisation of probation services that puts the public at risk.

“Fine collection requires the highest level of probity and accountability, and is competently handled by the current in-house service.

“To have ended up with a single bidder, and one who seems completely unsuited to the task, makes a farce of competition and shows Gove is following Grayling in his blinkered and ideological pursuit of outsourcing at any cost.”

General secretary of the Public and Commercial Services Union (PCS), Mark Serwotka, said: “We remain opposed to this sell-off. We do not believe it should be run for profit and in the hands of private bailiffs, who we fear could bring the system into disrepute by cherry-picking easier cases and being more aggressive in their approach.”

Frances Crook, chief executive of the Howard League for Penal Reform, is urging Concentrix to withdraw its bid – saying the contract for administering the “unfair, unrealistic and unjust” criminal courts charge would do the company more harm than good. In a letter sent to Concentrix’s chief executive, Chris Caldwell, she warned that the company was unlikely to be able to collect the charge from people “who do not have the means to pay for it.”

She added that Concentrix risked reputational damage in “being seen to profit... from the indigent, the mentally ill and the homeless”.

Ms Crook said: “The iniquitous criminal courts charge continues to attract criticism from across the spectrum and increasingly looks like an untenable policy that must be reversed by the Ministry of Justice. Case after case shows not only how unfair and unjust the charge is, but how it is simply unrealistic to expect the monies involved to be collected from people before the courts who simply cannot pay.

“All too often we see outsourcing companies stand aside from moral questions around government policy, abdicating any responsibility for their own actions. There is an opportunity here for this company to stand up and show that the private sector also recognises the criminal courts charge is wrong.”


According to this on Facebook, many colleagues have recently been receiving tax demands:-

GAH!!! Just had a P800 tax underpaid notice through my door. I suppose I shouldn't be surprised that in all the faffing about splitting the service some people couldn't keep a tax and pay record straight? Why was I surprised? Shaking, just called the tax office who said it was blatantly visible what they'd done and they would have it all looked at.... bet there's no compensation available for this though.... worst twenty minutes of my life thinking I would lose even more money every month paying back underpaid tax because my sodding government endorsed employer can't fudging add up or keep straight records.

I thought you may all like to have this information in case you get a tax demand as I have! I've sent Napo an email and the tax office a letter...see below.

Not content with making our lives a misery through TR, we're now being told that we owe them tax when the truth is we don't. Another austerity measure? Well they can F... Off!

Hi Dean

I believe you're dealing with tax discrepancies resulting from the TR nightmare. I received a tax form for 2014/15 saying that I had earned about £5000 more that I did and hence owed £343 in unpaid tax. When I rang the tax office, I was informed that they had been informed that I had worked for London Probation, the CRC and NOMS. In reality I transferred direct from LPT to NOMS and have never done any work at all for the CRC.

I enclose a letter I've sent to the tax office contesting this.

I thought it to bring to your attention as I'm sure that I'm not the only one affected; in fact it's likely that all London NPS employees will be affected in a similar way. Probably other areas are also likely to be in similar positions.

I will keep you informed of what happens.

Here's the letter:

"I am replying to the P800 regarding the 2014/15 tax year issued 06/09/2015. I telephoned your office today and was advised to write in with the reasons why I am contesting your calculations.

Up to 31/05/2014, I was employed by London Probation Trust (LPT) and then transferred to employment by the National Offender Management Services (NOMS). This followed the government policy, 'Transforming Rehabilitation' which split the probation service into two distinct parts. One remained in the public sector (NOMS) and the rest was taken into the private sector. In London, London Probation Trust became the London Community Rehabilitation Company (CRC).

This appears to have caused the problems with the tax calculation. It appears that in the years 2014/15 you have been given incorrect information by my past and current employers. I have been told that you have been sent information that I worked for three separate organisations including the CRC. As stated above, my employment was transferred directly from London Probation Trust to NOMS. At no time did I work for the CRC. The fact that my earnings for LPT appear to have been counted twice would account for the amount of tax which you state that I owe.

I enclose copies of all my wage slips and my P60 issued by NOMS for last financial year to assist you in calculating the correct amounts of earned and tax last year.

I await your reply".


Finally, not really TR-related, but part of a regular update on Corbyn and the shake-up in British politics. Billy Bragg posted this on Facebook recently:-

Of all the things I've read about Jeremy Corbyn since his victory in the Labour leadership election this is perhaps the most interesting. It appeared in the Daily Mail of all places and, as I have no wish to drive traffic towards their site, I'm pasting the whole thing here. Written by former Labour spin doctor Damian McBride, the article was entitled 'Why Jeremy Corbyn May Be The Best Thing Since Clement Atlee'. Well worth a read:

"To understand Jeremy Corbyn, you need to understand Holloway, the stretch of the A1 from Highgate to Highbury that he has represented in Parliament for three decades.

Forget the name of his constituency – Islington North – and forget every stereotype about poetry recitals and posh restaurants that you associate with that London borough. Holloway is an entirely different beast. From the massive Andover Estate, described as a ‘dump’ by Ann Widdecombe, to the huge Wetherspoon pub serving pints from 8am, this is not the gentrified Islington made famous by Tony and Cherie Blair.

Corbyn’s is the smallest constituency in Britain, but one of the most densely packed. More than 100,000 people live in an area the size of 1,000 football pitches, the best of which is managed by Arsenal Football Club, the new Labour leader’s most high-profile constituent.

Despite their similar populations, you could fit Corbyn’s Islington North inside David Cameron’s rural Witney seat 100 times over. In Witney, 93 per cent of the population define themselves as White British. In Islington North, fewer than half do. Just one in 250 of David Cameron’s constituents is black; for Corbyn, it is one in seven.

Corbyn was a radical socialist before he set foot in Holloway in his early 20s, but nothing he has seen in his years as its MP has softened his views. When opposing the Iraq War, he only had to look at the impact it was having on levels of alienation and extremism among the 10 per cent of his constituents who follow Islam, many at the notorious Finsbury Park Mosque.

He believes in the redistribution of wealth and increased investment in schools, transport, healthcare and housing because these are the needs he sees every day.

Before the General Election, many of my fellow Holloway residents were scathing about Ed Miliband and fearful of him taking office, but ask them how they would vote, and the answer was unanimous: ‘Labour.’ Why? ‘It’s Jeremy. He’s proper Labour.’ Proper Labour: the party established to represent the workers against the vested interests at the top.

Corbyn’s critics scorn the idea that Labour lost the Election because it was not Left-wing enough. But most ordinary voters had no idea what Miliband stood for. They did not see a socialist firebrand; they saw a chocolate soldier, who prevaricated over everything from his television image to his stance on the deficit.

By contrast, Corbyn’s undoubted appeal comes from the fact that he is principled, honest and authentic: he knows what and who he stands for, and says it loud and proud. When Ed Miliband said after his 2010 election: ‘We can’t be imprisoned by the focus groups – politics has to be about leadership or it’s about nothing’, no one believed he meant it. If Corbyn said the same, you can bet they would.

But he faces a rocky ride. Dozens of MPs are already disgracefully ignoring the democratic process and lining up to destabilise their new leader. The only way Corbyn can succeed is by maintaining his genuine voice and hoping that the majority of British people see the country more like the residents of Holloway than the residents of Witney: a country with deep social and economic problems, and massive challenges for public services, which cannot be fixed by more of the same.

The last Labour leader to represent an inner London seat, indeed the last leader of any major party to do so, was in his 60s by the time he became Prime Minister. He was unfashionable, disdainful of the media and he stood on a platform that promoted peace and investment in public services and housing, even with the country facing massive debts.

Clement Attlee went on to be Labour’s greatest Prime Minister. And while few may believe that Jeremy Corbyn can follow in his footsteps as he slips into the leader’s shoes today, one thing is for sure: He comes from the right place."


  1. On the matter of privately outsourced collection of court penalties, again, Last Week;Tonight with John Oliver has been showing examples of what will inevitably, be copied over here. This week, it showed a man who is racking up 110 dollars a month in non payment interest and a 200 dollar surcharge, every time he is arrested and brought before the court for non payment. What made the case newsworthy as well as futile, is that the company was still rigourously pursuing the debt - despite the fact that the guy is clearly and visibly terminally ill and both the court and company know it. Watch on catch up, if you can - it's a foretaste of what's coming.

  2. Thanks for yet another comprehensive blog Jim. Lots of food for thought. The incompetence undermines any paranoia I have.

  3. in approx. 2012 CRI lost the substance & alcohol contract in my area due to failure to deliver services. Getting drug test results, anyone to answer the phone etc was nigh on impossible.

  4. Another pointless topic.3 comments proves the lack of interest. Let's talk about what's happening today. I think we owe that to our sodexo colleagues

  5. Come on sodexo / purple futures colleagues what latest ?