A4E's Emma Harrison: no regrets on £8.6m pay

Fri, 17/08/2012 - 13:14 -- nick

If ever anyone was preceded by their reputation, it is Emma Harrison, founder of the back-to-work firm A4e.

She was once regarded as one of our most successful businesswomen, but events took a different turn last February when it was revealed she had paid herself an annual dividend of £8.6 million in one year.

The vast majority of the company’s work in helping the unemployed find new jobs comes from the Government, this was effectively taxpayers’ money.

So when it then also became public that some of A4e’s former employees were being investigated for fraud over old contracts, a national outcry ensued. 

Emma was perceived to be nothing short of a common crook – a woman with scant regard for the public or  our money. She was front-page news for weeks, her life was endlessly picked over, in particular her decision to share her Grade II-listed Derbyshire mansion with friends in a ‘posh commune’.

Yet amid the welter of headlines, one thing appeared to have been overlooked. She and A4e have been cleared of any wrongdoing.

As she speaks for the first time it’s clear her ordeal is far from over. The confidence that helped build a business with an annual turnover of about £230 million has taken an almighty knock and there’s still a feeling of disbelief about all that has happened.

‘Having fraud written alongside  my name is utterly disgusting to me,’ Emma, 48, says quietly. ‘You couldn’t get me more wrong. My whole life I’ve stuck up for doing the right thing, for this business that I love and then I get castigated and kicked around for it.

‘I went from knowing who I was and where I was going – based on all the principles I stood for – to being trashed, day in, day out. I remember saying, in the darkest moments, “I don’t know who I am any more.” For months I couldn’t go out, sometimes  I felt like I couldn’t breathe. I had to have pills to help me sleep.

‘My mission in life is to improve people’s lives. Yet everything I’d stood for didn’t seem to matter. I was terrified. You feel fear as an entrepreneur, but this was completely different.’

Emma admits that the figure of  £8.6 million is extraordinary but justifies it, saying: ‘People say it’s taxpayers’ money, but it is profit honestly earned over many years on orders that were placed with our company. I’ve been investing in this business, taking massive personal risks, for years. This was not a dividend of one year, it was a result of 25 years of work.

‘I agree it’s a fantastic amount of money but I have tens of millions of pounds invested in A4e, some of it supported by personal mortgages. I’m not a gambler, I was very exposed. Any entrepreneur will understand this. I’m the majority shareholder in A4e. I’m taking all the risk.

‘I had to take some of the risk – or some of the money – off the table and that’s what I did. I could have sold the company many times over.  I could be sitting with my feet up on some fancy yacht, but why would I? That would be like selling my life.’

Emma’s life is not particularly extravagant. The nature of her work – and her undoubted success – means she mixes with every sector of society, from the long-term unemployed  to prime ministers, but she remains determinedly down-to-earth.

She is a high-street shopper and is dressed in a pretty Karen Millen dress and cardigan when we meet. She does have a holiday home – a wooden house on a deserted beach outside Skegness. ‘I love it,’ she says.

‘It’s got three small and basic bedrooms and a kids’ den.  There’s a deserted beach, chips are a quid, it’s a proper life. I do jigsaws and crosswords and go for walks.’

Her main residence, Thornbridge Hall, near Bakewell in Derbyshire, is undeniably grand. The former stately home is set in more than 100 acres and has 16 bedrooms, a bar, a swimming pool, a cinema and a ballroom.

Emma first saw the Gothic mansion aged 15 when she was a wayward girl growing up in Sheffield. She says: ‘It was used by Sheffield City Council as an educational centre back then. I played truant from school quite a lot and had to go there with my youth worker. I said then that one day I would like to buy it and live in it with all my friends.’

In 2002 she did just that as she and her husband, Jim, paid £5 million for the country pile. The couple, their four children and ten of their friends all moved in on the same day. The families pay into a kitty for bills and groceries, but the Harrisons cover any shortfall. The residents share their cars and babysit for each other.

Four years after moving in, Jim, himself a successful businessman,  set up the now thriving Thornbridge Brewery within the grounds.

In 2007, Emma set up the Foundation for Social Improvement which teaches small charities how to fundraise and network. She says: ‘We help them become big charities, or just to survive. So far we’ve helped about 2,000, but I don’t see why it can’t be 10,000.’

Emma recalls their moving day: ‘I’ll never forget how we turned up with four lorries and moved into this house, which was a wreck. We turned the billiard room into a kitchen and all managed to find bedrooms that didn’t have the ceiling falling in. It was brilliant.

‘Three days later we threw a massive party and invited the whole village. About 500 people turned up and as they got to know us and realised what we wanted to do with the place, they all started returning bits that had “gone missing’’ over the years – random doorknobs and cornicing.

‘One of my brothers and some friends from Sheffield moved in with us. Some of them are still with us, some are new friends we’ve met over the years. There’s a self-employed electrician, a lawyer, a policeman, project managers, a full-time mum, a personal assistant – all sorts.

‘Some families live in the main house, others live in cottages on the estate. Some stay for months, some for years and one woman comes for her annual holiday. There are about  18 of us there on a regular basis, but it can be a lot more at weekends.’

‘The Duke of Devonshire lives nearby [at Chatsworth House]. He has visited and he loves it. And his mother Debo said it reminded her of the Bloomsbury Set.’ Debo was one of the six Mitford sisters, famed for their strongly contrasting – and very publicly held – political views in the Thirties and Forties. 

Emma maintains that it was the communal living that got her through the darkest periods of the past six months.

She says: ‘At one point my daughter was going to sing with her choir in Venice. I’ve never seen her sing before but I said I couldn’t go because I didn’t dare be seen at an airport in case it looked as if I was being extravagant – even though I was flying with easyJet.

'Then my friends at Thornbridge said, “Right, this is ridiculous, you’re going to Venice. We’re driving you.” They put me in the back of one of the cars in the middle of the night with some duvets and drove me the whole way there.

‘It was the best sleep I’d had in weeks. Because of them, I got to see my daughter perform at the Basilica that evening. So when people mock Thornbridge, that is the kind of friendship they are mocking.’

Thornbridge also provided Emma with the solid base and security that was so often missing from her childhood. Born to Roy, a businessman, and Theodora, a secretary – both now dead – she spent long periods in hospital as a youngster with what would later be diagnosed as Hirschsprung’s, a rare bowel disease.

As a result, she didn’t start school until the age of six. Emma says that her mother would disappear, sometimes for years at a time, pursuing various pipe dreams and love affairs, leaving their father to bring up her and her two brothers Harry, now 50, and Adam, 47. She admits: ‘Eventually you learn to stop crying, to stop chasing after the car.’ 

She became a pupil representative on the board of governors at her school when she was 15. She says she took on the role because she was ‘convinced better decisions could be made on behalf of the pupils’.

When the children were told that a fellow pupil, Danny, was going blind, she organised a school sale that raised enough money to send him to South Africa for an operation.

Emma recalls: ‘I remember telling my dad about it and he said, “Well, what are you going to do about it?” I’ve never forgotten that.’ She later studied mechanical engineering at Bradford University and joined British Steel. But at 23, her father asked her to help run his business, The Industrial Training Agency, retraining unemployed steel workers.

‘He told me he’d give me 18 months’ training,’ Emma says. ‘He gave me two bits of advice. The first was, “Know everything, criticise little, cherish your brethren.” The second was, “Never take even 5p from petty cash.” Then, 18 days later, he left to live in Germany with his new wife.’

Emma took over the running of the company, which had four full-time employees, two workshops, two offices and a turnover of £125,000  a year.

Six years later, with turnover up to £3 million, she walked away. She says: ‘Dad had come back. I didn’t know it at the time but he had  Parkinson’s. I didn’t want to run the business the way he wanted.

'I wasn’t interested in the money. I owned  50 per cent of the business but I wrote him a letter saying, “I don’t want anything, I just want you to know that six months from now I will leave.” And I did.’

She had secured a single government contract and formed A4e on the strength of it. These days, the company employs 3,500 staff across the world.

In 2010 she became David Cameron’s ‘Troubled Families Champion’ and devised a plan to help the 120,000 families who are third- generation unemployed. But as the furore over her payment gathered pace, she felt she had no choice but to resign as chairman of her company and her ‘Families Champion’ role.

‘Resigning was one of the hardest things I’ve ever had to do. I called an emergency board meeting and we got everyone together on the phone.

'I couldn’t have done it in person. I had it all written down on paper because I couldn’t trust myself. In the end, I couldn’t get the words out, I was too emotional. Someone had to finish it for me. I put the phone down and sobbed.’

The hardest thing to deal with was the impact on her children, who were bullied at school. Emma recalls: ‘The other kids would say, “When are you going to see your mum in prison?” Then I had to tell them to ignore Facebook and stay offline. 

‘But then the most amazing thing happened. One of my sons has Asperger’s syndrome so can’t really communicate emotionally. One night we were all having dinner and he pulled up a chair and put his arm around me. He didn’t know what to say, or how long to hold on, but it was the first time he had hugged me. I put my head on his shoulder and thought, “It’s going to be all right.” ’

Emma is still A4e’s main shareholder but now intends to concentrate on a range of new projects – including promoting women in business. She says: ‘There’s a big hole, but I know I have to find new ways to do the work that I love to do.

‘Really, it’s just like my dad said that time, “Well, Emma, what are you going to do about it?” ’

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