The 'Work' programme; will it work?

Emma Harrison, the prime minister's 'workless families tsar'





Will A4E Multi-millionaire Emma; and other welfare to work providers be able to deliver on their contracts?



In my thread on the 'welfare reform car crash', I've mentioned some long running and more recently emerging concerns which have arisen over the new 'Work' programme.


Here's what the Guardian made of it earlier this year


"This benefits bonanza is more big Serco than big society"

"The evidence is damning: private firms aren't much cop at welfare to work. But their chief executives are earning millions"

Polly Toynbee went on to say....

"Incapacity benefit claimants began to be "invited" in for tough new work-capability assessments on Monday – an invitation they can't refuse. In two pilot schemes 70% of claimants were judged fit for work, with a third put straight on to jobseeker's allowance – leaving just 30% too frail to be chivvied further.

Last week the government announced who had won contracts for the work programme: there was shock when, out of 40 contracts worth between £3bn and £5bn, only two went to not-for-profit groups. Not so much "big society" as big Serco. The biggest winner – and a surprise – was Ingeus Deloitte, which won seven huge contracts amid acid observation that its CEO was a former director at the Department for Work and Pensions. Concern was expressed that Ingeus had underbid more experienced providers: price was a clinching factor in the official scoring system, whereas bizarrely previous performance was not scored at all.

The greatly disappointed voluntary sector will be relegated to sub-contracting. The big companies will hand down their difficult cases, such as addicts, ex-prisoners or the mentally ill – creaming 20%-30% off the top in "management fees". The Glasgow-based Wise Group, whose board I was on until recently, is a leading not-for-profit organisation, and was shocked to win no contract and see Scotland go to Ingeus Deloitte despite a lower success rate. Wise is the sixth most successful in the UK for the flexible new deal and top for finding people work in the new deal for the disabled. It's about as big society as they come. Why didn't it win? Possibly because it wouldn't and couldn't discount too steeply: the voluntary sector can't gamble and borrow as large companies can.

Among the winners is A4E (Action for Employment) – hardly surprising as its founder, Emma Harrison CBE, was named by David Cameron as his workless families tsar. As the Observer revealed, she and her husband have a joint income of some £1.4m from their welfare-to-work empire. While any public sector chief executive earning over the prime minister's £140,000 is ritually slaughtered by Eric Pickles, not a word is said about private sector chiefs making a killing out of public contracts. Serco's CEO had an 18% rise to £1.86m.

Cameron has announced his intention to outsource not just the NHS but virtually the entire public sector to "any willing provider" – with little concern about profits made from the public purse. The City financier Lord Freud, a Labour adviser turned Tory minister for welfare reform, made plain last week quite how far this will go. Announcing the-welfare to-work contracts, he said: "This is the ultimate blueprint for delivering a wide range of government services – and one that governments around the world will be taking a look at."

Elsewhere in the article, concern is expressed over the effectiveness of these providers...

"When Sir Leigh Lewis, permanent secretary at the DWP, appeared before the committee, Margaret Hodge said: "I cannot understand on both value for money and effectiveness for the client group, why we are moving to a greater dependence on private providers – given that we like to have evidence-based policy." The mandarin was left floundering with nothing to say but the truth. First, Jobcentre Plus "is a very effective and able organisation so it is quite a tough test [for private companies] to perform as well". Second, it's all ideological: "Ultimately these are political judgments and not ones for civil servants."

The companies claim their results have improved since then: even so this evidence makes the work programme's target to take a million people off IB wildly ambitious. The new contracts are tougher, heavily backloaded so they only pay out once claimants are found jobs.

Read the rest of the article here..

www.guardian.co.uk/commentisfree/2011/apr/04/benefits-bonanza-big-serco-welfare

Watch the following video and see how both A4E and Reed Partnership came in for more than a battering before a Public Accounts Committee.





There's plenty more on the car crash post too, including a more recent committee video extract which tells us that there are still many uncertainties over the success or failure of these schemes.

See the video and read post (13) on the car crash thread..

mylegal.org.uk/index.cgi?board=frontline&action=display&thread=405&page=1

Here's my take on it all

The evidence is indisputable, welfare to work under flexible new deal didn't work. Providers failed abysmally under their contracts and I'm far from convinced they've got it right as we go through it all over again, albeit now under the guise of the 'Work' programme.

Minister Chris Grayling says he's 'relaxed' about private forms profiting from these schemes. Surely no minister in these times of cut back after cut back, should be relaxed when it comes to committing enormous sums at public expense.

Initial estimates came in at £0.3 billion, they have grown in successive multiples of £3 bn, then £5bn with mention in some reports of £7bn; - I'd put the expense at potentially over £9 billion. We should be far from relaxed over this kind of expense.

Far too little is being aired in the public domain over the horrendous cost of welfare to work implementation. Providers are looking at sums of between £2,000 and £14,000 per person to get them back to work. Why on earth can't the Jobcentres be given adequate resources to do the job without all this additional expense, isn't it why they are called Jobcentres?

Government seems to justify it by saying it's payment by results contracting, it's buy now pay later. Isn't that effectively borrowing on the nation's credit card? Private providers won't survive on thin air until they get paid, they'll have to borrow until they can submit their bills. Bu now pay later places a greater importance on providers to get their results, but will the jobs be real jobs? Buy now pay later still means the cash has to be outlayed from some source, but does it appear in our public accounts as money set aside? Remember we all have to pay it back.

What if it doesn't go as government plans, will government step in and bail these providers out to spare themselves the embarrassment of getting it horribly wrong? - I rather suspect they will.

And what of the not for profit sub contractors, won't they just palm them off with all the work which no one else wants to do?

Government has said it will engage with smaller contractors this time around with contracts of up to £50 million each, but has enough research really been carried out to ensure that previous providers aren't the same ones re-appearing under different names in the form of smaller subsidiaries? - Can we really be certain that lessons have been learnt from the past so that further failing doesn't occur all over again?

Is a rift breaking out between government and providers over government thinking they could do this all on the cheap, is this why 90% of providers are now expressing doubts over whether they can deliver on these contracts? Did they think there was more money on the table than there really is?

Perhaps, just too many people read the Daily Mail and the Daily Express and all too readily believed it would be all to easy to put '75% skiving' people back to work. Perhaps some have woken up to the realisation that those who have been so harshly demonised might just have a limitation in their ability to work?

There are simply too many unanswered questions, perhaps our family champion could enlighten us and tell us how it's all going to work? - but not in glossy leaflets or promotional videos, in good old fashioned pounds, shilling and pence please.



Source of information re: W2W providers being paid up to £14,000 per person.

www.dailymail.co.uk/news/article-2001817/Chris-Grayling-offered-firms-14-000-head-bounties-jobless-dole.html

* We generally don't promote links to the Daily Mail as a matter of policy but I've had to include it as a reference point.