Atos has ditched its £500m benefits contract: another outsourcer bites the dust

Atos has just given up one of its most lucrative government contracts. Perhaps it was tired of being called a 'murdering scumbag'...

by Emma Haslett
Last Updated: 27 Mar 2014

- From MT’s April 2014 issue: ‘How did outsourcing get into this mess?’

Atos has been pretty unpopular since it first took on the responsibility (worth £500m) of deciding which benefit claimants are fit to work. Either it got tired of receiving abuse on social media or it got tired of receiving abuse from the government: either way it, has decided to give up the contract.

Its troubles began last summer: having been accused of ‘ridiculously harsh’ tests by disability campaigners, the Department for Work and Pensions said there were ‘significant quality failures’ in the write-ups Atos produced after tests.

Outsourcing is in a dire old state at the moment: Serco and G4S are both in the quagmire for various reasons (over-charging for electronic tagging chief among them – but G4S deserves special acclaim for its Olympics screw-up). Even the government has been heavily criticised: a couple of weeks ago, the Public Accounts Committee lambasted the Coalition over the negotiation, management and transparency of contracts. The problem, of course, is that if the government keeps beating outsourcers over the head, it's going to run out of firms to fulfill its contracts. It makes nice headlines - but there are only about four companies in the market and three of them are currently being investigated.

This morning disabilities minister Mike Penning said Atos ‘will not receive a single penny of compensation from the taxpayer for the early termination of their contract. Quite the contrary, Atos has made a substantial financial settlement to the department.’

Getting outsourcers to pay the government? Keep going like this and the deficit will be solved in no time…

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