The education and employment charity Red Kite Learning has announced it is closing after 25 years because government policies such as the Work Programme have “squeezed” out small and medium sized organisations.
Brendan Tarring, the chief executive at Red Kite Learning, said the £500,000 minimum contract value meant the organisation had been unable to tender for larger contracts and “the payment-by-results regime” was financially too unstable.
He said: “It is a matter of great regret that our position in the squeezed middle of medium sized charities is not sustainable.”
He added that the Department for Work and Pensions (DWP) prime contracting model for the Work Programme lacks “the finesse and flexibility” to support the individual needs of job seekers.
“The Government’s fixation on cuts and awarding contracts on cost rather than quality is destroying the most sophisticated not for profit sector in the world,” Mr Tarring said.
A spokesperson from the DWP told FE Week: “We’ve got more than 400 charities and voluntary organisations involved in delivering the Work Programme, and many are doing very well.
“So far only a small number of organisations have left the supply chain and in most cases there have been performance problems or issues not relating to the Work Programme.
“The Work Programme exists to help those most at need get back into work and it is only fair and right to the taxpayer that we do not waste money on upfront payments with no guarantee of success.”