It has been a hidden secret for years, but the firms that used benefit claimants for free labour have finally been forced to reveal their true identities, as they were named and shamed in the media last week. Firms that were linked to Mandatory Work Activity were included on a vast list for everyone to see as they were accused of exploiting benefit claimants with free work. The list includes a shocking 500 companies and amongst them were well-known supermarket giants Tesco, Asda and Morrisons as well as budget chain store pound-stretcher. The list was created in 2011 and the shameless firms have now been revealed. As well as retail firms, there was also cash company cash converters, popular chicken restaurant Nando’s and high street drug store Superdrug.
The Workfare Scheme
The notoriously hated workfare scheme affected 10, 000 job seekers as they were forced to work 30 hours of unpaid labour in exchange for their benefits per month. The scheme represented itself as voluntary – if claimants wanted to work or to gain experience, but there were reports that if a claimant had joined the scheme they would risk being sanctioned (benefits cut) if they left the scheme or didn’t show up for a shift they were due to work. The organisations (in this case some considerably big firms) were responsible for reporting back on the progress of thee workers on the scheme. In this case, workers were forced into Mandatory Work Activity, and understandably there was huge backlash surrounding the scheme. Until now, it has been kept a secret which firms were involved in such an unfair process, protected by a lengthy and costly legal battle, conducted by the DWP. The notion behind keeping the firm’s identities a secret was to protect their commercial interest. In other words, there were fears that they would be boycotted by protests if it became known they were involved in workfare. The DWP was in fact overruled by Watchdog back in 2014 to reveal the names, but fought a strong battle to stand its ground. Last Wednesday the DWP was finally overthrown, and chaos and anger has ensued. Contender for labour leadership Owen Smith has said that this is just one of many cover ups by the Tories for the DWP, which needs to change. He goes onto mention other controversial Tory movements such as cuts to the much anticipated Universal Credit, as well as the bedroom tax that has undeniably left many in a state of devastation. To add insult to injury, it was of course the tax payer that funded the massive cover up of the workfare scheme users. Whilst there was no official spending figure released, it is thought the DWP could have easily racked up tens of thousands of pounds in the process.
The Dangers of Workfare
It is kind of a given that this kind of scheme will cause upset purely for the fact that it screams exploitation of the most vulnerable. However, there are also a number of other reasons why the Workfare scheme is disliked. Firstly, it undermines the actual responsibility of volunteering, which many people do all over the UK. It is important that the UK has genuine volunteers, and that they are rewarded for this exact reason. People that also already volunteer were being forced to give up their current position and go and volunteer somewhere else in order to claim their benefits – which doesn’t seem necessary. It also undermines the need to create real jobs, and in turn actively increases unemployment. If companies are able to get their workers for free, they are less likely to create paid jobs, which means less jobs and further unemployment. In one particularly severe case, a pizza company in Leicester sacked 350 workers and re-located to Nottingham, where they were able to take on over one hundred benefit claimants for no pay. Although they claimed it was to give these ‘volunteers’ ‘experience’, the real reason behind the company’s decision is probably rather obvious. the workfare scheme was also once described by the Trade union Congress as a ‘failed policy.’ There has also never been any actual evidence to suggest that the Workfare scheme helps and encourages people to find jobs, this fact was even concluded by the DWP themselves. Some people are asked to work full time on Workfare placements, which averages out at an earning of £2 per hour. Working full time leaves little time to spend searching for jobs that will take them out of the Workfare scheme and place them in genuine employment.
They have been described as having a ‘skewed view of the world’ and it seems that the Tories made a huge mistake in forcing people into unpaid work – and are more than likely going to have to pay for it. The Mandatory work Activity mostly took place within a six month period, between July 2011 and January 2012, and overall there were 534 companies to exploit workers, including charities. Places on the list include Hartlepool, Thurrock and Leicester.
Despite many of the companies unsurprisingly refusing to comment, The Independent managed to get word from a spokesperson from Tesco, who defended the supermarket giant by saying that they had realised that adopting the scheme wasn’t right for them, after they had agreed to pay into the scheme, they also say that despite this, they remain committed to finding employment for the long term unemployed. After coming under such fire, the DWP did comment, but didn’t refer to the scandal unfolding and instead continued to preach the benefits of employment programmes, by saying that each year they help thousands of people to find work, as well as providing very useful new skills.