Bogus psychometric tests for jobseekers were used without permission

Questionnaire "had failed its scientific validation".

The Guardian's Shiv Malik reports that the Government's Behavioural Insight Team – the so-called "nudge unit" – is in hot water over its unauthorised use of a bogus "psychometric test" designed to boost the self-esteem of jobseekers. Malik writes:

The Behavioural Insight team… has been accused by the Ohio-based VIA Institute on Character of bad practice after civil servants used VIA's personality tests in pilot experiments in Essex despite being refused permission to do so.

The £520,000-a-year Cabinet Office unit run by Dr David Halpern was told by VIA – whose members devised the personality test – to stop using the questionnaire because it had failed its scientific validation.

The Government's mistake was apparently in using a shorter version of the questionnaire than the 120- and 240-question ones which VIA had tested. So not only were they misleading jobseekers over what, exactly, the tests were doing – they were also using an intervention which had no evidence backing it up.

It will be interesting to see how – or whether – this affects the privatisation of the nudge unit. The government has announced plans to turn the team into a public service mutual, which would involve at least 25 per cent of the shares being held by the staff, and the rest split between government and a private sector partner. As Ed Mayo, of Co-Operatives UK, writes of that spin-off:

There is no vote for staff in this version of mutualisation, so they can perhaps be pressed into something they don't buy into. It is not really a new model but rather good old privatisation – although with the potential for the taxpayer to benefit if the business does well.

Above all, it is not, or at least not yet, a genuine mutual business. Nor is it a co-operative. And don't even mention the wonderful John Lewis, which is tediously and often inappropriately trotted out as an ideal for all services.

And if the government is hoping to benefit from this privatisation, it's best if it doesn't happen in a climate where the unit's unprofessionalism and lack of evidence-based rigour has just been exposed for all to see.

Which makes this particularly awkward timing.

Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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BHS is Theresa May’s big chance to reform capitalism – she’d better take it

Almost everyone is disgusted by the tale of BHS. 

Back in 2013, Theresa May gave a speech that might yet prove significant. In it, she declared: “Believing in free markets doesn’t mean we believe that anything goes.”

Capitalism wasn’t perfect, she continued: 

“Where it’s manifestly failing, where it’s losing public support, where it’s not helping to provide opportunity for all, we have to reform it.”

Three years on and just days into her premiership, May has the chance to be a reformist, thanks to one hell of an example of failing capitalism – BHS. 

The report from the Work and Pensions select committee was damning. Philip Green, the business tycoon, bought BHS and took more out than he put in. In a difficult environment, and without new investment, it began to bleed money. Green’s prize became a liability, and by 2014 he was desperate to get rid of it. He found a willing buyer, Paul Sutton, but the buyer had previously been convicted of fraud. So he sold it to Sutton’s former driver instead, for a quid. Yes, you read that right. He sold it to a crook’s driver for a quid.

This might all sound like a ludicrous but entertaining deal, if it wasn’t for the thousands of hapless BHS workers involved. One year later, the business collapsed, along with their job prospects. Not only that, but Green’s lack of attention to the pension fund meant their dreams of a comfortable retirement were now in jeopardy. 

The report called BHS “the unacceptable face of capitalism”. It concluded: 

"The truth is that a large proportion of those who have got rich or richer off the back of BHS are to blame. Sir Philip Green, Dominic Chappell and their respective directors, advisers and hangers-on are all culpable. 

“The tragedy is that those who have lost out are the ordinary employees and pensioners.”

May appears to agree. Her spokeswoman told journalists the PM would “look carefully” at policies to tackle “corporate irresponsibility”. 

She should take the opportunity.

Attempts to reshape capitalism are almost always blunted in practice. Corporations can make threats of their own. Think of Google’s sweetheart tax deals, banks’ excessive pay. Each time politicians tried to clamp down, there were threats of moving overseas. If the economy weakens in response to Brexit, the power to call the shots should tip more towards these companies. 

But this time, there will be few defenders of the BHS approach.

Firstly, the report's revelations about corporate governance damage many well-known brands, which are tarnished by association. Financial services firms will be just as keen as the public to avoid another BHS. Simon Walker, director general of the Institute of Directors, said that the circumstances of the collapse of BHS were “a blight on the reputation of British business”.

Secondly, the pensions issue will not go away. Neglected by Green until it was too late, the £571m hole in the BHS pension finances is extreme. But Tom McPhail from pensions firm Hargreaves Lansdown has warned there are thousands of other defined benefit schemes struggling with deficits. In the light of BHS, May has an opportunity to take an otherwise dusty issue – protections for workplace pensions - and place it top of the agenda. 

Thirdly, the BHS scandal is wreathed in the kind of opaque company structures loathed by voters on the left and right alike. The report found the Green family used private, offshore companies to direct the flow of money away from BHS, which made it in turn hard to investigate. The report stated: “These arrangements were designed to reduce tax bills. They have also had the effect of reducing levels of corporate transparency.”

BHS may have failed as a company, but its demise has succeeded in uniting the left and right. Trade unionists want more protection for workers; City boys are worried about their reputation; patriots mourn the death of a proud British company. May has a mandate to clean up capitalism - she should seize it.