The public spending watchdog has had “discussions” with the Department for Work and Pensions (DWP) over concerns about a £184 million disability assessment contract awarded to Atos Healthcare.{jcomments on}

{EMBOT SUBSCRIPTION=5,6}The much-criticised company won the contract last year to carry out assessments for the new personal independence payment (PIP) – the replacement for disability living allowance – across London and the south of England.

But Disability News Service (DNS), and the crossbench peer Lord [David] Alton, have raised serious concerns about the award of the contract.

Now the National Audit Office (NAO) has confirmed that it is investigating these concerns.

In a letter to the peer, Max Tse, NAO’s value for money director, told Lord Alton that his concern about DWP’s PIP contract with Atos Healthcare was “an area of interest to the NAO”.

He said NAO had had “a number of discussions with the department on its contractual arrangements for the PIP”.

Tse added: “These are ongoing but I hope to be able to respond to you shortly on the issues you have raised.”

Atos won the contract by boasting of its “extensive” network of 16 NHS trusts, two private hospital chains, and four physiotherapy providers, all of which it said would provide sites where the tests would take place.

But in the months after the contract was awarded, all but four of the NHS trusts and both of the private hospital chains dropped out.

Following a Freedom of Information Act (FoIA) request from DNS, DWP admitted that Atos had far fewer sites in its supply chain than it originally stated.

When it submitted a tender for the contract, Atos stated that it had a network of 740 assessment sites across London and the south of England. But DWP has now admitted that Atos only has “up to” 108 centres available that meet its requirements.

Because there are so many fewer centres, thousands of disabled people will face longer journeys to reach their assessments.

Lord Alton said: “When millions of pounds of the public’s money is being diverted to a private company it is crucial that there is accountability, transparency, and public confidence.

“I welcome the NAO’s decision to scrutinise the Atos contract and to assess whether performance matches promise.”

Atos has insisted that no pledges made to DWP were broken and that it was “absolutely usual for there to be changes between point of tender and delivery”, while DWP was “fully aware” that contracts had not been signed with the 22 organisations at the point the tender was submitted.

An NAO spokeswoman said: “At the moment we cannot really say anything more about what is in the letter as no decision has been made.”

News provided by John Pring at


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