Tuesday 15 August 2017

Privatisation Not Working

Those of us who have been living with the ongoing nightmare of probation privatisation will be extremely interested in the breaking news regarding another Tory privatisation, that of Learndirect. In addition to information now hidden in the interests of 'commercial sensitivity', I'm pretty sure MTCnovo complained about the quality of their inspection as well. Note too how a lot of money seems to have disappeared, just as with the CRCs. This in the Guardian:-   

Learndirect branded inadequate in Ofsted report it tried to suppress

The UK’s largest provider of adult training and apprenticeships has been branded inadequate in a damning inspection by the education watchdog Ofsted, which it then went to court to try to suppress. Learndirect, which has almost 73,000 trainees on its apprenticeships and training programmes, went to the high court to try to quash the report in which it is said to have been awarded the lowest possible grades.

However, its application for a judicial review to overturn the report was refused in a judgment on Friday and Ofsted confirmed the as-yet unpublished report would be released on Thursday. According to reports in the trade newspaper FE Week, which was in court, Learndirect – the UK’s largest vocational training provider – was awarded grade fours for its apprenticeships and outcomes for learners.

Among the criticisms was that “management of apprentices is ineffective”, while about a third of learners on apprenticeships “do not receive their entitlement to off-the-job learning” and fail to develop “the skills they require to progress to the next step in their career”, the paper reports. Details of the case emerged when the court lifted reporting restrictions on Monday after refusing Learndirect permission to appeal.

Responding to the court judgment, Learndirect said it had challenged Ofsted’s inspection because it did not believe the process was a true reflection of the company’s training quality and performance. “The business presented compelling evidence as part of the appeal to support this view,” a spokesperson said. “In particular, we felt that the sample size of 0.6% used by Ofsted to arrive at its conclusions is not sufficient to judge the quality of Learndirect’s training. We are therefore extremely disappointed with the verdict.”

Ofsted defended its inspection. A spokesperson said: “Seventeen inspectors took part in this inspection over four days when they spoke to learners and apprentices. Inspectors interviewed employers, apprentices and learners in person and over the phone, reviewed portfolios of work, and looked at progress reviews when they gathered evidence. As well as visiting apprentices in their workplace, inspectors also reviewed a wide range of evidence to ensure that both the judgments and inspection grades were secure.”

Court documents passed to the Guardian by FE Week, which worked on a joint investigation with the Financial Times, show Learndirect was concerned about the potentially damaging effect of the inspection report on its business, which is largely dependent on government funding.

Earlier this year it was reported that Learndirect, which has 1,645 employees, was consulting on redundancy plans that could affect up to one in 10 of its staff. Learndirect’s spokesperson said on Monday that the company’s underlying business remained stable and it would continue to focus on its learners.

He added: “The business’s recent financial performance has been significantly impacted by external factors, in particular successive central government funding cuts which have reduced our revenues by £100m over the last three years. Significant cuts have affected all providers in the sector. We have responded to these difficult market conditions by changing our operating model and diversifying our income, and we have remained competitive throughout this period.”

Accounts filed with Companies House show that the finances of Learndirect and its associated companies – ultimately owned by Lloyds Banking Group – have deteriorated in recent years. Learndirect’s profit after tax dwindled from £10m in 2012 to just £1.6m in the year to July 2015, the most recent period for which figures are available, despite revenues surging from £134m to £171m.

At the same time, Learndirect’s parent companies, Pimco (Holdings) and Pimco 2909 paid out tens of millions of pounds in management fees, dividends and interest payments. Pimco 2909’s outgoings in 2012 include the £500,000 sponsorship of the Marussia Formula One motor-racing team, chaired by Darryl Eales, who was a Pimco 2909 board member and former chief executive of LDC. LDC is the private equity arm of Lloyds and is the ultimate owner of Pimco (Holdings) and Pimco 2909.

Learndirect was launched by the government as a charity and taken private by LDC in 2011. At that point it had no borrowings but the group of companies is now heavily laden with debt. The group had nearly £96m of debts due for repayment after one year, including £44m to Lloyds Development Capital. That compares to £85m of assets, of which £71m is marked as “goodwill” – essentially notional value rather than tangible assets.

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Talking of MTCnovo, thanks to the reader for letting us know about this from last week:-

Dear colleagues

The MTCnovo Board would personally like to inform you that Rich Gansheimer will be finishing his secondment with MTCnovo at the end of this month and will be returning to Management and Training Corporation’s (MTC) Corrections division in America.

We would like to take this opportunity to thank Rich for his outstanding leadership, unwavering commitment and enormous contribution in transforming the business. Rich’s professionalism, expertise and first-hand knowledge of the justice markets have helped establish MTCnovo as a valued partner of the Ministry of Justice. We are sad to see Rich leaving us and wish him all the best as he returns back to MTC in the USA.

Rich said: "It has been an enormous privilege to lead this wonderful business. Working with MTCnovo has been one of the most defining and rewarding projects of my career, and I’d like to thank all our staff for their dedication, hard work and support. I wish you well and look forward to seeing MTCnovo’s continued success."

New Managing Director

We are pleased to announce that David Hood will be appointed as the Managing Director of MTCnovo in mid-October 2017. David will join us from management consultants Veracity, prior to this he worked at the National Offender Management Service (NOMS). He brings with him a wealth of experience, knowledge and expertise which will help guide MTCnovo onto its next chapter. Ahead of taking up his role, David will be taking time to get to know the team.

David said of his appointment: "I am delighted to be joining MTCnovo, the opportunity to take forward the excellent and important work Rich and the team are doing is a real privilege. Clearly, the world we work in continues to present substantial challenges, but I’m confident that we have a great base from which to confront those challenges. I look forward to meeting you all and understanding more about the great work you do."

Rich will continue to oversee operations until he leaves on August 31, and all reporting lines will remain the same.

For the interim period ahead of David taking up the role, the MTCnovo Executive Team will report into Helga Swidenbank, Director of London CRC, and she will report to the Board.

MTCnovo Board of Directors


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"He brings with him a wealth of experience, knowledge and expertise which will help guide MTCnovo onto its next chapter." I wonder where he got that from?

This from the MoJ website:-

Director, Contracted Services
David Hood



Biography

David has extensive commercial experience, and joins NOMS from a senior role in the Ministry of Justice’s Commercial and Contract Management Directorate. In this role David has responsibility for the commercial management of private prison contracts, CRC contracts and PECS contracts among others.

Director, Contracted Services


Responsible for operational delivery managed through contracts with other providers such as:

  • contracted prisons
  • community rehabilitation companies
  • prisoner escort and custody services
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This from the archive, Monday, 28 November 2016:-

TR - The Next Phase

Senior Civil Servants never seem to stick around for long as they climb the greasy pole; they're never around when everything starts to fall apart. Here's another rising star to watch:-

Darren Tierney appointed Probation System Review SRO

Darren Tierney has joined the NOMS Agency Board as the Probation System Review Senior Responsible Owner (SRO).

CRC contracts became operational in February 2015 and the Probation System Review has been set up to assess progress against the objectives set out in the Transforming Rehabilitation Programme. The initial phase of the review has been undertaken by a small team led by Andrea Torode working to David Hood.

This has found that while overall CRC performance has been steadily improving against the measures in the contract, actual case volumes are different to those which had been anticipated; there is variation in quality of delivery; and progress in some areas (such as Through the Gate support) is less than expected.

The next phase of the review involves detailed engagement with CRC Providers to improve current arrangements.

Michael Spurr said: “Ministers have made this a key priority for the Department and to take the work forward we are strengthening arrangements by appointing a dedicated SRO at Director level. I’m really pleased that Darren Tierney has agreed to take the role. He brings excellent programme management and policy experience to the Agency which will significantly enhance Board capability.

Andrea and her team will work to Darren who will take overall responsibility for the review receiving dedicated support from Commercial and Finance colleagues across the Department. David Hood will concentrate on managing day to day service delivery across both the CRCs and other NOMS Contracts.”

Darren Tierney said: “I am delighted to be joining NOMS as SRO for the Probation System Review. The services provided by CRCs are vitally important and Ministers and the NOMS Board are rightly focussed on ensuring those services are being delivered effectively. It is great to be joining the team here, and I look forward to building on the great work done to date by Andrea Torode and David Hood and their teams.”

13 comments:

  1. Reference Mr Tierney, that bird has long since flown:

    "I have 15 years policy, strategic and corporate experience in the UK Civil Service across several departments. I have worked or led 4 high profile pieces of legislation, managed transformation programmes, and acted as principal adviser to 3 Cabinet Ministers."

    Experience
    Department for International Trade (DIT)
    Director of Strategy
    January 2017 – Present (8 months) | London, United Kingdom

    Cabinet Office
    Director - Civil Service Strategy and Efficiency
    August 2015 – Present (2 years 1 month)

    Ministry of Justice UK
    Director General (interim)
    May 2016 – January 2017 (9 months) | London, United Kingdom
    Interim DG for prison reform.

    UK Ministry of Justice
    Policy Director
    May 2013 – August 2015 (2 years 4 months) | London, United Kingdom
    Policy Director in the Criminal Justice Group responsible for youth justice, including the Transforming Youth Custody programme, and Foreign National Offender policy.

    UK Ministry of Justice
    Director of Transforming Justice Strategy
    May 2012 – May 2013 (1 year 1 month) | London, United Kingdom

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  2. Privatisation does not work. It's more expensive, and always leads to much reduced quality of service.
    Privatisation only works for the privateers.
    Reading about Learndirect yesterday, it's clear that the government tried to cover it up, omitting to publish information when it should have and obligated to.
    In a really disturbing move recently, the government has launched a tax payers legal challenge to stop the publication of a report on the fit for work programme. The bases of the challenge is that the publication of the report may be damaging to the companies involved, Athos, and Maximus.
    It beggars belief that the tax payer is funding a legal battle in an attempt to protect the corporate interests of multinationals.
    But it's likely that it's an attempt by government to suppress information on privatisation and are fearful of the public realising just how wrong and costly their privatisation projects have gone.

    http://www.politics.co.uk/news/2017/08/07/dwp-fights-to-block-publication-of-fit-for-work-documents

    'Getafix

    ReplyDelete
    Replies
    1. Documents relating to the government's controversial fit-for-work tests could be blocked from publication after the Department for Work and Pensions' (DWP) launched a legal challenge.

      In April, John Slater submitted a Freedom of Information request (FOI) asking for details of the 'outcome reports' which are completed by the private company contracted to carry out the tests. The reports would include information about the number of people with a terminal illness or limited capability to work subjected to the test.

      The DWP initially said it did not hold the information but later argued that releasing it could damage the company's commercial interests.

      The Information Commissioner's Office ruled that the DWP must publish the documents but the department has appealed that decision, meaning the case will now be heard at the First Tier tribunal.

      "The DWP's decision is very disappointing," Slater said. "At times it seems like they operate the default position of appealing any decision made by the commissioner that goes against it, regardless of the costs or the merits of its case.

      "The commissioner was clear in her decision notice that the DWP had relied on "barely explained assertions" to justify its position and yet it is exposing the public purse to the expense of a tribunal hearing."

      Since 2015, Work Capability Assessments (the official name for the tests) have been carried out by the Centre for Health and Disability Assessments (CHDA), a subsidiary of the company Maximus.

      The outcome reports are produced every month by the CHDA and detail the outcomes of the tests from each assessment centre.

      Last year, Slater a won a lengthy legal battle with the DWP over the disclosure of documents relating to problems with Universal Credit.

      A spokesperson for the DWP said:

      "This information is exempt from disclosure under FOI rules as it covers commercial interests. We publish a range of information on WCA outcomes, including at a regional level."

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  3. Privatisation is expensive & myopic. I've calculated that the UK taxpayer has invested some £1.5m in me via training & salary over 20 years. I still have about 15 years' working life left in me but was pushed overboard by the innovative privateers. These are the hidden costs of privatisation, over & above the human cost.

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    Replies
    1. What really beggars belief is that the UK government thinks it's safe to feed £100s millions of taxpayers money into a Limited company.
      They're called Limited companies for a reason.

      Delete
  4. Further education privatisation was all Michael Gove's plan. He said no public money to go into FE by 2020. In addition to learn direct, college providers are in serious trouble. Newcastle College arm's length apprenticeship organisation collapsed for same reason before Xmas - following OFSTED inspection. The approach of CRCs is very familiar - deskilling, getting rid of high cost experienced competent employees, setting up admin hubs (black holes where things disappear). I've heard the same is happing in NHS. Reliably informed that where I live the NHS is on the brink of collapse. What do all of these have in common? If you have money you don't need any of these services, so who cares.

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    Replies
    1. Took a brief look on Companies House site at the only accessible finance document submitted by Sodexo's CLCRC to date, for 15 month year end 31 Aug 2015. Assets just shy of £500k were written down under depreciation rules to around £80k. The company shows a £64k loss over the operating period. There's an entry referring to about £1.7m spent on "redundancy".

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    2. £1.7m on refundancy? So if we share the £80m modernisation fund equally between 21 CRCs, we get around £3.8m per CRC (it probably wasn't that simple but, without any transparency or remotely honest communication from MoJ or CRCs, it'll do). So CLCRC have pocketed around £2m of monies intended for paying refundancies to staff. Wonder where that went? Mrs McDowell"s bonus & pension fund?

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    3. *redundancy* - sorry, wobbly train tracks!

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    4. Yeah, and while they don't need them they can at least syphon off taxpayers money to an assortment of mates and other unsavories. What's not to like....

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  5. MTCnovo haven't shined in the recent Ofsted report on Rainsbrook secure training unit (prison for children as young as 12), but when they're thanking 'Rich' for his knowledge of the justice 'markets', then they probably won't be to bothered by what Ofsted has to say.

    http://www.coventrytelegraph.net/news/local-news/rainsbrook-prison-violence-fights-report-13449785

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  6. I don't know, it appears to be working well for the railways......

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  7. How many times were we told that private surpasses public ownership in terms of efficiency, competence and value for money. In the same way that Brexit would give the NHS a weekly windfall of 350 million, the spin that privatisation was superior and in the public interest, was always a sham. In addition we see vanity projects like the Garden Bridge... already lavished with ten of millions of public money and those public servants charged with awarding contracts, now in senior positions in the engineering company that has gobbled up the lion's share in consultancy fees. Seek to question and hold them to account and they scuttle off to claim commercial confidentiality – their mafia-like omerta.

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