Peer to quiz watchdog over failure to probe Atos PIP contract concerns

A peer is to ask the public spending watchdog why a long-awaited probe into the government’s new disability benefit ignored serious concerns over the award of a £184 million assessment contract.

A National Audit Office (NAO) director told Lord [David] Alton last summer that a major value-for-money study into the new personal independence payment (PIP) would examine his concerns.

The crossbench peer had written to NAO after an investigation by Disability News Service (DNS).

That investigation showed how Atos Healthcare won the contract by boasting of its “extensive” network of 16 NHS trusts, two private hospital chains, and four physiotherapy providers, all of which it said would provide sites where the PIP tests would take place.

But in the months after the contract was awarded, all but four of the NHS trusts and both of the private hospital chains dropped out.

Following a Freedom of Information Act request from DNS, the Department for Work and Pensions (DWP) admitted that Atos had far fewer sites in its supply chain than it originally stated in its tender documents.

When it submitted the tender, Atos stated that it had a network of 740 assessment sites across London and the south of England.

But Atos only secured 96 assessment centres, including not a single one covering a vast sweep of north London, and only one in Suffolk, one in Cambridgeshire, and just three in Norfolk.

Because there are so many fewer centres, thousands of disabled people are facing delays in being assessed, and longer and more complicated journeys to reach their assessments, often by inaccessible public transport.

The NAO report was finally published this week, but it failed to address any of the concerns about the Atos tender document.

Lord Alton said: “Investigating Atos without examining the original tender agreements is like holding a court case without looking at the evidence.”

He is now writing to NAO to express his concerns and to ask for an explanation.

Richard Butchins, the disabled documentary-maker, whose recent work includes films on the government’s “fitness for work” assessment and the PIP reforms for Channel 4′s Dispatches, said: “While the NAO report rightly points out what a debacle PIP is rapidly becoming, it’s disappointing that they chose not to interrogate the tender process in depth.”

He said there was “clearly a problem with Atos and Capita [the other provider of assessments] that’s not being addressed”, and pointed to the NAO report, which says that DWP relied on assurances from the providers themselves about their readiness to begin the roll-out of the PIP assessment programme.

Butchins said this was “no way to implement vital public services”.

An NAO spokesman refused to explain why the Atos tender document had not been addressed by the study.

He said: “Whatever representations are received by the National Audit Office, the decision to proceed with a study, the remit of that study, the contents of the final report and the decision whether to publish are entirely down to the judgement of the comptroller and auditor general [Amyas Morse].

“He has complete discretion on what he reports to parliament.”

Asked again why the concerns about the tender document were not taken into account, he said: “I don’t know why it wasn’t taken into account. We can’t look into everything.”

The NAO report, which looks at the first six months of PIP, to the end of October 2013, concludes that assessment backlogs had led to “delays and uncertainty” for claimants, confirming reports by DNS dating back to last November.

It concludes that DWP had made far fewer claim decisions than intended, with  backlogs developing at each stage of the process.

By the end of October, Atos Healthcare had completed only 55 per cent of assessments within the required 30 working days, while Capita had completed just 67 per cent.

By 25 October, DWP had made only 16 per cent of the expected number of PIP decisions.

The report also found that the administration cost of a new PIP claim was £182, more than three-and-a-half times the cost of a DLA claim (£49), while the average time for a decision on a new PIP claim was 74 days, compared with 37 days for DLA.

The report says DWP has not been able to tell claimants how long they are likely to have to wait, “potentially creating distress and financial difficulties”.

Despite the delays, DWP still expects to make savings of £3 billion a year from its introduction of PIP, with 600,000 fewer people receiving support by May 2018 than if it had not replaced DLA.

NAO said it was too early to judge who was responsible for the backlogs.

But one of the measures Atos is now taking, according to a blog on its website, is “using more centres for the face to face consultations”, suggesting that its failure to secure enough assessments centres has been a key factor in causing delays.

Morse said DWP had failed to allow enough time to test whether the assessment process could handle large numbers of claims.

He said: “As a result of this poor early operational performance, claimants face long and uncertain delays and the Department has had to delay the wider roll-out of the programme.”

Margaret Hodge, the Labour chair of the public accounts committee, said: “I was shocked to learn that, not only will PIP claims cost almost three-and-a-half times more to administer than DLA, they also take double the amount of time to process.

“The current backlog and delays in processing claims are simply unacceptable and will no doubt cause real distress for vulnerable claimants.”

Her committee will examine the report on 20 March.

27 February 2014