How Cameron's £70mback-to-work tsar was left fighting for her own job

Pressure on PM to suspend entrepreneur over alleged fraud scandal

Entrepreneur, visionary, philanthropist: David Cameron's back-to-work tsar, Emma Harrison, sells herself with the unashamed punch of a competitive religious leader.

Her A4e [Action for Employment] consultancy's motto – "doing well by doing good" – has been sold to two successive governments as an economic gospel capable, like the miracle of water into wine, of turning the jobless into skilled, in-work taxpayers.

Ms Harrison uses language that mixes Wall Street with the Bible belt to describe finding someone a job. "I walk by their side, hold their hands and we go on a journey together," she says. Her "holistic" approach swayed Gordon Brown. And when jobless problem families were deemed a root cause of last year's riots, Mr Cameron became a born-again follower.

However, A4e yesterday described as "disproportionate" calls for its government contracts to be suspended after police visited its offices following new claims of fraud, thought to relate to four staff. The police inquiry was dismissed by one of A4e's consultants, the former Home Secretary David Blunkett. He said: "This is the same story as two years ago when the company took action themselves and informed the Department for Work and Pensions rather than wait for a probe." Mr Blunkett is paid between £25,000 and 30,000 a year to help A4e with its £50m contracts overseas.

Despite her humble origins at an agency helping to re-skill Sheffield's washed-up steel industry, Ms Harrison has turned her father's small A4e business into a consultancy thriving on £300m of essentially public contracts in 11 countries. Admitting to running "illegal tuck shops" at the age of nine, and subsequently making a "total mess" of her A-levels, she now employs 3,300 people. Her personal worth of £70m is within the top 100 of the Sunday Times Rich List.

Although A4e's official literature boasts of "improving lives all over the world", not everyone buys the back-to-work, private-sector evangelism. The MP Margaret Hodge, chairman of the Commons Public Accounts Committee, warned that A4e's fortunes were based on public cash, but it was doing what state agencies often did for less. "We should be looking for others companies like this to appear soon," she said. "This is what creeping privatisation looks like – and we are not looking hard enough."

Ms Harrison, however, is not afraid to look and sound different from the old state-run jobcentres. "This isn't an empire we're building. It's a global social movement," shouts the firm's literature. Although she insists "vision and purpose" must be explained and understood within 30 seconds, economic psycho-babble permeates A4e's promotional material. There is talk of "owning outcomes", the "personalisation of public services" and of "vibrant supply chains".

"Improving lives" with public cash has brought Ms Harrison within touching distance of her childhood dreams. The neo-Gothic mansion she bought in the Peak District a decade ago for £5m was the study centre she visited to learn Russian as child. "I used to imagine myself sweeping down the stairs in a long, red dress. So I bought it," she said.

Other homes she shares with her husband, a successful businessman, and their four children include a £3m mews property in London. Ms Hodge thinks the success is unwarranted, that job-finding targets set for some of A4e's larger state contracts have been "abysmally" missed, and that credit should instead go to the low-profile employment charities routinely sub-contracted key work from Ms Harrison's "visionary" empire.

As a Labour minister, Ms Hodge may forget it was Gordon Brown's first New Deal scheme in 1997 that accelerated A4e's expansion out of Sheffield with initial contacts worth £80m. Termination fees worth tens of millions in the Treasury's switch from Alistair Darling to George Osborne, and a recent £8.6m dividend as A4e's major shareholder, have brought Ms Harrison closer to what she admits is the "billion-pound target in my head".

Another target, if she ever gets the chance, will do more than prompt questions in the Commons. She said recently: "I've got another million people I want to help. I'm going to ... sort out the entire health system."

She also claims to have "a role in the Bank of England's regional consultations on behalf of the Monetary Policy Committee". The Bank questioned the use of the word "role", saying: "I think Emma's website needs a bit of an update."

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