Atos Loses Disability-Testing Contract With U.K. Government

Atos, a French outsourcing company, is compensating the U.K. government and ending its contract to assess whether disabled people are fit for work, after criticism from lawmakers.

The Work Capability Assessments program is designed to cut the welfare bill by reducing the number of people registered as disabled and moving them back into jobs. It has been attacked over the quality of the decisions and the speed with which they’re made.

“The government has reached a settlement for Atos to exit the contract to deliver Work Capability Assessments before it is due to end in August 2015,” Disabled People’s Minister Mike Penning said in a written statement to Parliament. “I am pleased to confirm that Atos will not receive a single penny of compensation from the taxpayer for the early termination of their contract, quite the contrary, I can also confirm that Atos has made a substantial financial settlement to the Department for Work and Pensions.”

Atos shares were at 67.69 euros ($93.2) at 12.45 p.m. Paris time, up 0.4 percent on the day. A report from Parliament’s Work and Pensions Committee on March 18 urged the government to invoke penalty clauses in its contracts with both Atos and London-based Capita Plc over delays in assessing whether people are eligible for payments.

Penning said the government will advertise for a single new provider to take over the job by 2015. In the long term, the government will move to multiple providers to increase competition, he said.

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