Preventing fraud and improper practices in contracted employment programmes

Book excerpt: The introduction of the Work Programme in June 2011 largely addressed the main weaknesses in previous programmes which had led to a risk that fraud by providers was being understated. Some risks still remain because not every control applies to every programme, particularly to smaller ones. This report finds in particular that the assessment of the risk of fraud at A4e missed vital evidence. The Department does not currently obtain all relevant copies of providers' internal audit reports and did not receive the paper sent to the Chair of the Public Accounts Committee which highlighted a possible systematic failure to mitigate the risk of fraudulent and irregular activity. More than half of fraud allegations since 2006, valued at £773,000, have been in respect of New Deal programmes which ended in 2011. Schemes such as the Flexible New Deal and the Work Programme that replaced the New Deal have been designed with measurable and verifiable outcomes to minimize the risk of fraud. For example, the DWP now checks the records of HM Revenue and Customs to test whether claimants are actually working. But, notably, in the case of the £8 million programme providing mandatory work activity, there are still no independent checks with employers that unemployed people said to have been placed with them have been. Recommendations include that the Department make the most of the fraud risk knowledge it possesses and share it more effectively; and that users' complaints be used to assess the quality of service providers.