Paul Williams had been out of work for three years when he asked to be referred to the Wise Group.

Paul Williams had been out of work for three years when he asked to be referred to the Wise Group. After working in retail and marketing on leaving school, he had spent some time travelling the world, before returning in 2005 to nurse the grandmother who had helped raise him, in her final years.

When she died, after devoting three years to being her carer, the 35-year-old discovered the world had moved on since he had left the job market.

Looking for work, he discovered that even call centres were demanding six months' experience and he was increasingly alarmed. "I had never chosen not to work. I couldn't wait to get back to working," he says.

Through Job Centre Plus he contacted the Wise Group, the social enterprise which has just scooped a huge government contract to help 90,000 people attempt to return to the workforce.

Paul was given a personal interview, followed by support and dedicated call centre training. Eight weeks into a 13-week course, he was taken on by Glasgow-based call centre company Response. Since then he's been thriving, helped by regular follow-up contact with his assigned worker at the Wise Group. "Every -thing is going well now, and the Wise Group and the company have been great."

Paul isn't likely to be the toughest challenge facing the Wise Group, after the government awarded it preferred bidder status for the new work, worth a potential £140m, under the Flexible New Deal programme.

The company will take on responsibility for South Scotland, which covers Ayrshire, Dumfries, Galloway, Inverclyde, Lanarkshire, East Dunbartonshire, Edinburgh, Lothians and the Borders.

It is one of two dozen contracts announced by the government last week. All are to be paid on results, with the bulk of the value of the contract dependent on hitting targets in terms of moving people off benefits and keeping them in work. Payments are triggered when workers are still in post after 13 and 26 weeks.

At a time when vacancies are plummeting because of the recession, while those who have lost their jobs during the economic crisis are competing for every post, the rewards are far from guaranteed. In fact it was rumoured during the bidding process that a number of potential private sector bidders pulled out without tendering, as a result of the level of risk the government was asking them to take on.

All the same, most of the preferred bidders chosen for 24 contracts have come from the private sector. Only the Wise Group, and Working Links, a public-private-voluntary sector partnership, which has won four contracts, have broken the mould. Serco Group will run three contracts, while A4E is preferred bidder on another five.

Neither will the Wise Group be able to concentrate on the easier' task of getting the recently redundant, with their relative motivation and experience, back to work quickly. The contracts specifically relate to those who have been out of work for at least a year.

Laurie Russell, chief executive of the Wise Group said the announcement was a vote of confidence in the social enterprise sector, and would involved the creation of some 200 jobs within the group itself to handle the five- year contract.

"I think it is very important for social enterprise. It demonstrates that we can compete with large multi-national private businesses on quality, price and delivery," he explained.

"There is a group of people who will find work more easily, but we can't cream off the easiest clients," Russell added. "The Flexible New Deal is aimed at the more difficult client group - those who have been on benefits for some time, or are drifting towards long-term unemployment."

In fact, the client group is likely to include many of the hardest to place, including those who have been on incapacity benefit long term, and ex-prisoners or drug users, for example.

"It will be a huge challenge across the country, not just for us. This programme was set up at a time when the economy was healthier than it is now. Currently, vacancies are down by 40%."

Russell said the security of a five-year contract was another important factor to the business.

The Wise Group has a track record in this area, having delivered the Government's previous New Deal scheme, and having found work for more than 7000 Scots over the last two years alone. However its success rate at moving people into employment has dropped from a high of 45% to 39% in the current climate.

But Russell says there are jobs out there, and not all on low pay either. "We aim to get people into work above the minimum wage, what people term a living wage," he says, adding that for some, minimum wage working is acceptable, if it fits their lifestyle well. The right people can also still advance rapidly, he adds.

"It is also about convincing people that there is a lifestyle benefit about simply being in work," he adds. "You get self- esteem, a social life, the chance to meet people and you are doing something interesting with your days. The cliche about people sitting on benefits having a good life is not the reality. That is no lifestyle. It is depressing."

Other charitable partners may well get a look in at the work, given that the Wise Group will be running only 40% of the contract in house, with the other 60% sub-contracted. But main partner status affords the company a in important strategic role with the Government Department for Work and Pensions, Russell says.

A further phase of contracting will cover the rest of Scotland, with Glasgow potentially a separate contract. The Wise Group is gearing up to bid for that as well, but the government has yet to announce any details.