Services provider Capita is still in the running to operate the government's Individual Learning Accounts Mark Two scheme despite being widely criticised over the scandalous failure of Mark One, which resulted in widespread allegations of fraud and financial abuse.
Education and Skills minister Ivan Lewis left open the possibility of the company’s involvement in a Commons debate. He also brushed aside all appeals for compensation to be paid to learning providers who can prove they lost out when the government shut down Mark One in November last year, three weeks before it said it would.
The emergency action was taken because of the extent of suspected fraud and the sharply rising cost of the ILA scheme, which ended up 50% over its £201m budget.
The scheme allocates £150 of government money per adult to bring them back into education – the original project saw 2.5 million people taking part.
But Education and Skills Committee chairman Barry Sheerman complained at being denied full information about the government’s contract with Capita because of ‘commercial confidentiality’.
He said the Department of Education and Skills got the contract with Capita wrong.
Capita, he said, should have accepted a share in the risks and did not flag up early enough the problems that might occur or give early warning when things started to go wrong.
But Lewis said: ‘There is no done deal about the successor scheme and Capita’s involvement; no decision has been made.’
He said criteria must be satisfied before a decision could be made on Capita’s future involvement – the government had to be satisfied they were best placed to ensure the new scheme, to be announced in the autumn, is a success.
Later MPs shouted in protest when Lewis insisted the government ‘has no legal responsibility’ to compensate learning providers who were caught out.
But he confirmed criminal charges were being brought against 13 individuals while 12 await trial and one person has already been convicted.