Big fines imposed on disability assessment firm

The company given responsibility for managing controversial "MoT tests" on disabled people has been fined repeatedly for failing to meet performance targets, the Government admitted yesterday.

Alistair Darling, the Secretary of State for Work and Pensions, has given the business services company SchlumbergerSema until next summer to improve or face losing the contract to perform medical assessments on people claiming incapacity benefit.

Ministers revealed that financial penalties have been imposed on the company every month for more than two years. Managers have also been told to draw up a series of action plans to improve services at medical centres managed by the company.

Last month, ministers awarded the company a two-year extension on its contract despite repeated complaints about shortages of doctors and poor performance.

The medical assessments are at the heart of highly contentious new rules forcing disabled people to undergo medical checks before they can claim incapacity benefits.

The latest row comes after long-running concern over the medical assessment service. Last year, members of the all-party Commons Social Security Select Committee criticised Sema, which has held a contract since 1998 to perform medical assessments, and called on the Government to renegotiate the deal.

Ministers insist that performance has improved since Sema was taken over by the international computer services group Schlumberger in the spring. It was revealed last month that the company had been awarded the extension to its contract.

Yesterday, the company and the Department for Work and Pensions insisted that the service was improving, but Opposition MPs went on the attack.

Professor Steve Webb, the Liberal Democrats' work and pensions spokesman, called for full details of the company's contract to be made public.

He said: "The failures of this contractor are widely known by those who have had the misfortune to deal with them. It is unacceptable that a new contract has been handed to them on a plate after they have been repeatedly penalised for poor performance.

"At a time when the Government has made it clear that the new compulsory work-focused interviews could trigger more assessments for disabled people, it is unacceptable that this company is awarded the contract to deal with an increased workload.

"Disabled people have put up with poor service from this company for too long. It is high time that the Government got on the side of disabled people."

Details of the financial penalties, known as "service credits", which have been imposed monthly since September 1999, were revealed by Nick Brown, the Minister for Work, in a parliamentary written answer.

A spokeswoman for the Department for Work and Pensions confirmed that penalties had been imposed, but insisted that an action plan was in place to improve the service.

She said a "change programme" had been put in place, including management changes and changes in staff.

"An assessment will be made in May next year. There must be some evidence that they have met objectives in key areas for the contract to be extended to 2005," she said. "We are working very closely with SchlumbergerSema and the company, as far as we are aware, seems to be on course."

A spokeswoman for SchlumbergerSema said that details of the penalties were commercially sensitive, but insisted that the service to patients had improved since the company won the contract. She said: "There have been lots of achievements since we took over the contract in 1998. The number of incapacity benefit examinations was up by 20 per cent between August and October compared to the same period last year.

"We are committed to improving the service. As part of this we are introducing a new IT system that will produce better quality reports that are easier to understand.

"We are also working to increase the number of doctors working on the contract."