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Shaw Trust examines merger with Work Programme prime contractor

Governance | Tania Mason | 1 Feb 2012

The Shaw Trust and Careers Development Group (CDG), two of the UK’s biggest welfare-to-work charities, are considering a merger.

The two organisations have today announced that they have commissioned an independent feasibility review to explore how they might work more closely together, potentially to the point of a full merger.

The review will examine whether the two charities could help more unemployed people by joining forces. At present they have a slightly different focus in terms of their core customer group - CDG serves people who have been out of work for some time, while the Shaw Trust works with people at disadvantage or with disabilities.

CDG is the only UK-based charity that is a prime contractor on the Work Programme.  It won the contract in east London, in partnership with for-profit employment and training firm Maximus, and they have 15 sub-conctractors. It is also part of the Work Programme delivery for two successful Maximus bids in West London and the South-East.

The Shaw Trust did not win any prime contracts but is a sub-contractor on the Programme.

CDG is also Work Choice prime provider through its partnership with Wise Employment.

The Shaw Trust has not had an easy time in the last few years.  Its latest permanent chief executive, Sally Burton, left suddenly last September after two years in the role. During her tenure she hired several new senior staff but during 2009/10 she also oversaw the payment of £915,000 in severance payments to 15 employees who earned salaries of £60,000 or more.

Burton had been brought in to stabilise the charity’s management following the departure of former CEO Ian Charlesworth, who was put on gardening leave after he disagreed with trustees over the future direction of the charity.  

Regarding the collaboration with CDG, John Briffitt, chairman of Shaw Trust, said: “For the last 30 years, Shaw Trust has worked at the heart of the community; helping thousands of disabled or disadvantaged people to build confidence, motivation and the skills to find and sustain work. That mission continues but we also fully recognise the ever-growing challenge of delivering vital services to our clients with the realities of a more commercially-driven welfare state.

“We think that a blending of Shaw Trust and CDG may potentially better meet this challenge.  With shared values and a common purpose, it may bring about a stronger voice, more innovative services and most importantly, significant benefits for our clients across the UK.  We now want to confirm this and await the results of the feasibility review.”

According to their most recent annual reports, for the year to the end of March 2011, CDG had income of £30.8m while Shaw Trust’s income was £112.6m.

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