THE Coalition's campaign against rewards for failure has been called into question after the head of a welfare-to-work company with an "abysmal" record of delivering UK Government programmes received £8.6 million last year.
Earlier this week, Vince Cable, the Business Secretary, on the back of executives at the Royal Bank of Scotland and Network Rail waiving £1m bonuses, claimed the Lib-Con Coalition was now winning the battle on bonuses.
Emma Harrison, who heads A4e, paid herself the £8.6m dividend from her company, which last year derived all of its £180m turnover from Government contracts.
The A4e issue came to light during cross-examination of civil servants by MPs on the Commons Public Accounts Committee, who were asked about how contracts for the Government's £5 billion Work Programme were awarded.
Labour's Margaret Hodge, the committee chairwoman, told them how it was "rather surprising to me that you did not have regard to past performance of contractors.
"Why not? A4e... their performance on (Pathways to Work) was abysmal."
Her committee colleague Richard Bacon noted how A4e had got just 9% of clients into work through the Pathways programme when 30% had been expected.
Robert Devereux, the chief civil servant at the Work and Pensions Department, said that because other companies, which had not been involved in providing previous welfare-to-work programmes, had also tendered for the contracts, then it would not have been possible to consider past performances.
Andrew Dutton, A4e's Chief Executive, revealed that of the £11m paid out in dividends to its five shareholders, 87% went to Ms Harrison.
Ms Harrison was made the families' tsar in 2010, and following last summer's riots in England, David Cameron praised her work.
Although the main contractors under the Work Programme are the companies Ingeus and Working Links, A4e has been engaged by both companies as a subcontractor.
In particular, the firm delivers the programme in Edinburgh for Working Links and is largest subcontractor under that contract with a 15% share of the work.
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