I wrote about this earlier in the week NL halting the bidding for contracts regarding the flexible new deal.
News that Labour’s radical plan is in turmoil and facing possible legal challenges comes as unemployment is about to pass the two million mark for the first time in more than a decade. Analysts believe it will hit three million before the end of this year.
Responding to warnings that his reforms will not work without major changes, James Purnell, the work and pensions secretary, has abandoned plans to announce the preferred bidders for the multi-million-pound contracts this week. This follows demands from the firms involved for hundreds of millions more in “up-front” cash. A crisis meeting between top department officials and the bidding companies was cancelled on Friday after Whitehall announced a “short pause” in the tendering process.
And these greedy private companies aren’t happy and are demanding more up front cash from the government. It didn’t dawn on these companies when they first put their bid in that the economy was in the process of nose diving? Some of them are now threatening legal action. The original idea for contracting out was that the private companies carried the risk and this was factored in the cost.
But in reality this is a nonsense as private companies go back to the government asking for more money as opposed to taking the risk. So more public money will be chucked at the greedy private sector. Where’s the advantage in that?
It’s dishonest to discount the private sector bid on the basis that it will be carrying the risk because it won’t, it will be the taxpayer!
As Mark Serwotka says: Nobody can have any confidence in the claim that the flexible new deal can start in October. Any attempts to rescue these flawed plans will result in taxpayers handing a blank cheque to the preferred bidders
[...] are halting the bidding for contracts regarding the flexible new deal. The private sector are whinging about not being able to cope with administrating welfare benefits [...]
The free market has comprehensively screwed up the world. Why should Purnell’s welfare market solve all problems connected with unemployment and disibility?
[...] says Tony McNulty in regards to the Flexible New Deal funding. You may recall recently the private sector bidders whinged about ‘up front’ service fee element in the contracts be raised from 20% to 50%, and the [...]
[...] They assumed that it would be essentially simple, but coupled with the economic meltdown where they bleated and whined for more funds from the government and the fact the whole welfare benefits system is massively [...]