Report Finds Work Programme Performance “Extremely Poor.”
The Rt Hon Margaret Hodge MP, Chair of the Committee of Public Accounts, today said:
“The Work Programme is absolutely crucial for helping people, especially the most vulnerable, get into and stay in work.
“However its performance so far has been extremely poor.
“The first set of data on job outcomes shows that between June 2011 and July 2012, only 3.6% of people referred to the Work Programme moved off benefit and into work, less than a third of the target of 11.9%.
“In fact, performance was so poor that it was actually worse than the Department’s own expectations of the number of people who would have found work if the Programme didn’t exist.
“None of the providers managed to meet their minimum performance targets. The best performing provider only moved 5% of people off benefit and into work, while the worst managed just 2%.”The Programme is particularly failing young people and the hardest-to-help.
“It is shocking that of the 9,500 former incapacity benefit claimants referred to providers, only 20 people have been placed in a job that has lasted three months, while the poorest performing provider did not manage to place a single person in the under 25 category into a job lasting six months.
“The Department must hold failing providers to account, as well as ensuring that good practice is identified and shared.
“Under the payment by results system, the Department has incentives in place which in theory are supposed to prevent providers concentrating on the easiest cases and ignoring those who are hardest to help. But these incentives are not working and there is increasing evidence of ‘creaming and parking’.
The statement continues
“A provider that continues to underperform could become financially unsustainable. The Department must identify cases where a provider is at risk of failing and ensure there are specific plans in place to deal with this.
“When the Department eventually published the first lot of performance data, 18 months into the Programme, it lacked context or explanation and was four months later than promised.
“The Department did, however, published unvalidated data from a trade body representing the providers. This is just not on. In future we expect data to be published in a much timelier manner, with a proper explanation if performance falls short.”
The first set of data on the employment outcomes achieved by the Work Programme shows that it is performing well below expectations. From June 2011 to July 2012, only 3.6% of people referred to the Work Programme moved off benefit and into sustained employment, less than a third of the level the Department expected. None of the 18 providers met their minimum performance targets. Actual performance was even below the Department’s assessment of the nonintervention rate—the number of people that would have found sustained work had the Work Programme not been running. While we recognise that it is early days for the Work Programme, such poor performance undermines confidence in its longterm success. The Department needs a better understanding of the factors that led to early performance being well below expectations in order to assess whether the longer term targets for the Work Programme are still achievable.
2. There is substantial variation in the performance of individual providers. The best performing provider moved 5% of people off benefit and into sustained employment, the lowest performing managed only 2.2%. The Department has dismissed local economic conditions as the reason for variation; instead it attributes it to the different approaches taken by providers and the competence of their management. The Department told us that it is working with providers to ascertain what approaches are working well and which are not. The Department should put in place mechanisms to share lessons learned and disseminate good practice across providers. It should also hold poor performing providers to proper account.
3. The incentives for reaching the hardest to help claimants are not working. Early evidence suggests that the Work Programme is failing those claimants who are hardest to help, despite the differential payment arrangements intended to incentivise providers not to neglect this group. Results for these claimants (those claiming Employment Support Allowance) were worse than performance for the easier to help claimants (on Jobseeker’s Allowance). The Department’s own evaluation also suggests that the hardest to help are receiving a poor quality service, with providers focusing on the easiest to help. There is some emerging evidence that those who are hardest to help are being parked with minimum support, and therefore little prospect of moving into work. The Department should identify why the Work Programme’s financial incentives are not working as intended and, in its formal response to this report, set out what action it will take to address the problem.
4. Poor performance to date increases the risk that one or more provider will fail. A provider that continues to underperform may become financially unsustainable and go out of business, or the Department may decide to cancel its contract. The Department will have a better idea of which providers are at risk of failure when performance data is available up to March 2013, and it can cancel contracts if necessary after June 2013, when providers will have had two years to help their first cohort of claimants. The Department told us it has procedures for identifying and dealing with provider failure and that it has in place a framework contract from which it could appoint a replacement provider. To facilitate swift and tailored interventions in the event of failure, the Department should, in the period up to June 2013, monitor contracts to identify those most at risk of failure and produce contract specific plans for the steps it will take should failure occur.
5. The Department published performance data on the Work Programme without sufficient context and explanation. The Department’s failure to publish information on its own expectations of performance, or an explanation of why actual performance was worse than expected, hindered a proper understanding of the Programme’s progress. To our surprise the Department did publish unvalidated information from the trade body representing providers. It was also in stark contrast to the Department’s willingness to make Parliament and the public wait for almost four months, hiding behind National Statistics’ requirements, before it published its own data. In future the Department should release information in a timely manner, and include details of expected as well as actual performance, explaining any differences between the two.
Ipswich Unemployed Action adds the following observations.
We contest the claim that, “The Work Programme is absolutely crucial for helping people.”
- The Work Programme is based on the idea that people need to be ‘fitted’ into work. That there are jobs ‘out there’ waiting to filled. There is no evidence that it addressed the problem of mass unemployment itself.
- The Work Programme offered ‘training’ to make people ‘ready for work’. What is the evidence of the impact of any ‘training’ in these results?
- The Work Programme is part of the growing ‘unemployment business’. We notice that the government preferred to rely on statistics from this business rather than public ones for its initial presentation of results. Is there other influence of how this business has determined government policy on unemployment?
- The Work Programme has been marked by several fraud cases, and the scandal of unpaid ‘workfare’ which private companies have profited from. What, in view of these dismal outcomes, will be done about this?
- What sanctions will be taken against Minsiters, companies and other individuals responsible for these poor results?
More widely we and other sites written by the unemployed have exposed poor service, systematic bullying and misconduct in numerous Work Programme agencies.
What will be done about this?