Government row with fat cats threatens Asylum seekers' shelter

Marc Wadsworth - EXCLUSIVE

Staff have called a strike on Thursday to save a British charity which houses asylum seekers after a dispute between troubleshooting accountants and the Home Office over whether or not it should be closed down. Trade union Unison says the row threatens the jobs of the 135 staff who run Astonbrook Housing Association.

The charity, which was set up in Birmingham in 2002 by Somalians who had fled from their war-torn country, looks after 2,000 refugees throughout the country. Accountants Baker Tilly were appointed as interim managers of Astonbrook by the Charity Commission in July last year, after allegations of fraud. No one was was charged after a police investigation. Baker Tilly have been paid fees by the charity of more than  £1m, which staff claim has turned the once financially successful enterprise into one that is loss-making.

In a letter of May 13 leaked to The-Latest, Gail Adams, the Home Office's Midlands and East Region director, told 'stakeholders' of the charity: "I am writing to inform you that the charity Astonbrook Housing Association are handing back their accommodation contract to the Home Office because the charity have confirmed that they cannot provide the service required under the contract."

But Baker Tilly denied to staff that they had given up the contract. Alan Caperon, a director of the firm which specialises in the 'restructuring and recovery' of ailing businesses, said in an email on Wednesday: "We met with the Home Office last week where we explained the problems we had and they asked us to provide them with a financial model. We did discuss the options available to Astonbrook and it was agreed that we would have another meeting this Friday when the Home Office would know the amounts involved. In considering our options, the staff are also at the front of our minds"

He added, unequivocally: "I can assure you that the Interim Managers have not handed back the NASS (National Asylum Support Service Scheme) contracts."

But Adams said, firmly: "The Home Office is working with the charity and other providers to safely and securely transfer the services provided under the contract to existing target contract accommodation provider/s in West Midlands."

West Midlands staff yesterday agreed to take strike action and spokesperson Berrenga Forbes said:  " The situation is appalling. The Home Office claim the interim managers have handed back the contract to house the asylum seekers to them but that has been denied by Baker Tilly. It therefore looks like 135 staff could lose their jobs. Yet Baker Tilly walk away with a million pounds sanctioned by the Charity Commission who brought them in to save the scheme not close it down."

He added: "Astonbrook has provided an exemplary service for asylum seekers and refugees and this does them a big injustice which the Home Office, Baker Tilly and the Charity Commission must answer for. Why is it that staff were not informed that the contract was being withdrawn either by Baker Tilly or the Home Office? This behaviour shows a total lack of regard for the charity and its employees."

Until the appointment of the interim managers in July 2007, it was a Somalian-led, financially successful charity which reinvested surpluses for the benefit of the asylum and refugee communities it serves. In the year ended 31 July 2007 it had a turnover of  £14.5 million and made a surplus of  £1.1 million.

In 2005 the charity won a contract from the Home Office. In March 2006 the charity began doing their work under the National Asylum Support Service Scheme (NASS). The contract increased in value from  £40,000 in the first month to  £1.1million in June 2007.

Staff picketed the Birmingham branch of Baker Tilly on Friday.

A letter has been sent from the staff to the Home Secretary Jackie Smith demanding that she steps in and stops the closure of Astonbrook.

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