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06.11.14

Government’s Work Programme failing harder-to-help claimants – PAC

Companies delivering the government’s flagship Work Programme have, on average, spent less than half of what they originally promised on getting harder-to-help claimants, such as those with disabilities, into work, according to the Public Accounts Committee (PAC).

The cross-party Committee of MPs argued that instead contractors have been focusing on easier-to-help individuals and “parking” harder-to-help claimants. 

During the launch of PAC’s latest report, the chair of the Committee, Margaret Hodge, stated that the DWP has not succeeded in incentivising Work Programme providers to support harder-to-help claimants into work. Almost 90% of Employment and Support Allowance claimants on the Work Programme have not moved into jobs. 

“It is a scandal that some of those in greatest need of support are not getting the help they need to get them back to work and are instead being parked by providers because their case is deemed just too hard,” she said. 

“The Department must do more to encourage providers to work with harder-to-help groups by tackling poorly performing prime contractors and sharing information on what works.” 

The DWP pays prime contractors to provide support to people to get them into long-term employment using a payment by results approach. The amount the Department pays a prime contractor depends on its success in getting people into sustained work and the payment group of the individual. 

Currently, the DWP has 40 contracts with 18 prime contractors. 

PAC’s report, however, did highlight that performance for people who have completed the full two years on the Work Programme has been similar to previous welfare-to-work schemes. 

For example, cohorts of participants aged 25 and over claiming Jobseeker’s Allowance who have completed the Work Programme have achieved job outcomes in 27% of cases, compared to performance for a group with similar characteristics under Flexible New Deal of 26%. 

A DWP spokesman said: “As this report says, the Work Programme is helping more people than any previous employment programme, with over 330,000 people moving into lasting work and finally gaining the economic security that comes with a regular pay packet. 

“The Work Programme has contributed to the largest drop in long-term unemployment in a generation and providers are paid by results, with more money for the hardest to reach, but only if they get those people back into lasting work.” 

The Employment Related Services Association (ERSA), which represents firms delivering welfare to work services, stated that it “totally rejects” any claim that investment in jobseekers on Employment Support Allowance (ESA) has fallen. 

Contractors have not reduced their spending on jobseekers on ESA, said the association, insisting that spending has gone up 

Kirsty McHugh, ERSA chief executive, said: “The sector will be delighted that the PAC has recognised its efforts in supporting the long-term unemployed into work. The fact the programme is performing as well as predecessor programmes is a huge achievement given the challenging backdrop of the economy and austerity.” 

Despite this, the group of MPs have recommended that the DWP should review the impact of differential payments to prime contractors on their support to participants with different barriers to finding employment. 

They added: “Before we take further evidence in early 2015, the department should update us on performance in respect of harder-to-help groups, and its progress encouraging prime contractors to work with them.” 

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