Pathways to Lessons Learnt
It's by now an open secret the Pathways to Work doesn't. Of course there have been some swallows, but no summer. This is far from surprising as Pathways was quite clearly a failed policy from the beginning. But can we learn anything from this, and what are the implications for the FND beast? Indeed, does FND have a similar signature - an evaluation term used to highlight a recurring theme or pattern that is clear to the trained eye. And if FND does have a similar signature what can we do about it. In short, can we learn anything from Pathways.
I'd suggest we can, otherwise it wouldn't make much sense to write this other than to join in the general moaning and disparaging of our peers and colleagues at one, or some, of the providers.
We might begin by considering just how very different the JCP Pathways was to the provider Pathways, and what the true requirements are for a program of this nature compared to what was actually provided.
I'm trying to keep things brief so I'll have to ask you to accept the shorthand and the occasional gloss over. And by all means feel free to disagree.
Tackling the JCP Pathways first. Well, things began well. There was a screening tool, the CAT, which I have to say was excellent. It was world class and worked extremely well. Except, JCP wasn't able to train its frontline staff to use it. The CAT requires a great deal of both skill and ability. A highly trained and experienced qualitative interviewer with the right background could use it to great advantage. In the hands of front line staff it was a bit like asking someone who has only ever cycled to drive an HGV.
Next, they developed the WFI. The WFI, again, is an excellent tool. It is basically a cognitive interview that guides the individual away from their concerns and into a positive frame of mind in relation to work. A good WFI will, quite literally, change someones life. And the WFI was well documented, including the production of training CDs. But, again, you need able and skilled front line staff to deliver a WFI. It's no mean feat. And repeating the same process but modified for each individual and being sensitive to their needs and circumstances is hugely demanding. Yes, if properly applied there is no doubt the WFI has the potential to revolutionise front line delivery, but that would take a level of understanding that most providers lack and clearly wasn't in evidence in JCP at the time, which doesn't mean things won't change at JCP of course.
Third, they had the CMP. Curious. From the outset DWP acknowledged in their public domain reports that there was no requirement for health professional input, and no requirement for a CMP provision. Why do it then? Simply this. On the one hand they recognised that if people were on health related benefits then our of respect they should be granted access to a health care professional. Second, if people whom the state had classed as too ill to work were going to be mandated onto a return to work program then quite clearly that circle needed to be squared. Of course, the circle was never squared. That is another story, of course, and we can return to the CMP later. And we will return because although the CMP probably has no place in a Return to Work provision, helping people manage and overcome 'health related barriers' has tremendous value. of course, we know how to do this - time (there are plenty of examples from the US and some reasonable, though less powerful, ones from the UK). What we lack is a method of doing this for volume cost effectively with a tangible outcome.
Fourth, the process. Under JCP a person entered the WFI process. We are concerned here primarily with the mandatory provision as the voluntary provision is simply NDDP despite the desperate desire to insist otherwise. It is. The customer enters the WFI process and progresses through it. However, if they are not progressing well they were sent along to the CMP and the clock stopped ticking! So under JCP a mandatory customer could be on provision for anything up to around 10-12 months! That's 6 months of WFIs + 13 weeks (or more, occassionally a little less) of CMP! There were also anecdotal stories of JCP customers entering the CMP and then being referred off Pathways because the CMP provision had decided they were too ill to return to work! This, by the way, is all available in the DWP reports and evaluations. There is nothing previously untold here.
Now, unleashing Pathways, in the way it was unleashed, onto providers was akin to having a fleet of mopeds, each with four or five people sitting on it, drive the wrong way up the M4 from Reading to London at four o'clock on a Friday night. Need I say more.
I really need to put together a write-up on the Pathways review process that's been taking place since Christmas or so. There's an evaluation due out this Autumn in any case. I do wonder why providers still haven't handed back their contracts, if things are as bad as they're supposed to be.
because that would be a fail, wouldn't it.
Early results from the Pathways to Work jobs programme show a litany of cashflow problems and missed targets, raising concerns about the Government's capacity to deal with rising unemployment.
With the Conservatives and Labour both championing the same reforms, the marketisation of welfare once seemed one of the few uncontroversial aspects of Gordon Brown's troubled premiership. Not now. The UK is in recession, jobless numbers are rising at alarming rates, and welfare reforms, based on paying private and third sector jobs brokers by their results in getting the long-term unemployed into work, have been thrust into the spotlight. Questions are now being asked about whether such reforms, designed in times of high employment and aimed at the long-term jobless, can cope in the current economic conditions, with hundreds of thousands of newly unemployed.
Ministers can draw little succour from their vanguard programme, Pathways to Work (PtW), which was rolled out in April 2008, and is intended to drastically reduce the 2.6 million people in the UK claiming incapacity benefit (IB). PtW, which is worth £329 million between 2008 and 2010, is the first employment programme to employ private and third sector jobs brokers on a payment-by-results basis. Under the terms of their contracts, brokers are paid a sum for each jobseeker that they advise, getting 30 per cent upfront, a further 50 per cent for getting the claimant into work, and the remainder when the participant has been in the job for 13 weeks. Ministers say their "minimum expectation" for brokers is a job entry rate of 45 per cent of the jobseekers that they advise.
However, early results from the programme have been less than encouraging. According to Department for Work and Pensions (DWP) statistics, all the private and voluntary sector jobs brokers delivering PtW are well short of their targets for getting people into jobs. The DWP figures, published in July, show that up to October 2008 - even before the sharp rise in unemployment last winter - providers had an average job entry rate of only 16 per cent for claimants who had voluntarily joined the programme, and just five per cent for those who had been referred onto PtW - massively short of the 45 per cent expectation.
Consequently, the brokers aren't getting paid much. Earlier this year, Chris Melvin, chief executive of employment charity Reed in Partnership, said that "the majority, if not all" PtW providers were losing money and that some may be forced to hand back their contracts. Another senior welfare-to-work figure told Regeneration & Renewal that some brokers were reducing the level of support they were offering to claimants to cut costs. Last month, the Shaw Trust, the UK's largest voluntary sector provider of employment services for disabled people, announced it had made a £2.8 million loss in 2008/09, compared with a £7.4 million surplus the previous year. The charity attributed the loss to the high start-up costs of delivering its five PtW contracts. In the same month, the charities Action for Blind People and the Royal National Institute for the Deaf both announced they were handing back their PtW contracts, citing the high cost of delivery, the "inadequate level of income" to sustain the provision, and the difficulty in meeting the DWP's performance targets.
Minister say these cashflow problems will be resolved over the three- to five-year lifetime of the contracts and, as the economy picks up and employment rises, the brokers will reap the dividends of their investment. However, this argument, based as it is on an assumption that the economy will soon be resurgent, does not inspire universal confidence. Ian Mulheirn, director of think-tank the Social Market Foundation, agrees that the poor performance of jobs brokers is largely a result of the recession, but warns that because it is now harder for brokers to get people into work, the level of funding the PtW programme receives may no longer be adequate. Indeed, in April a DWP report concluded that PtW was so underfunded that brokers were unable to cover their costs, largely because the support required by claimants was "over and above" what could "realistically" be delivered with the funding provided.
Brian Bell, chief operating officer at employment partnership Working Links, admits the funding for PtW is "very tight". He says: "We felt that, because of the poor results early on, we could either cut our services back to the bare minimum or invest more to drive up results; we chose the latter." Bell adds that Working Links is currently breaking even on its contracts and moving into profit, although contracts remain "extremely challenging". "Of course there is more we would like to do with some jobseekers," he says, "but the funding just isn't there."
Like other senior figures who spoke to us, Bell says under-funding is largely the result of a false assumption at the outset of the PtW programme that most participants would have been in work relatively recently, and would, therefore, be reasonably close to the labour market and not in need of intensive support. But Bell says this hasn't been the case. "They might be new claimants, but often they may have been out of work for anything up to ten years and will just be moving between benefits," he says. This means the kind of support offered through PtW, which is centred on five monthly work-focused interviews - essentially one-to-one meetings between the claimant and an adviser, targeted at identifying and solving the claimant's problems - is not intensive enough.
Mulheirn adds: "Ultimately, using the private sector is not just about getting more people into work but about doing it more cheaply.In the recession, all providers will be struggling to hit targets, but the expectation is that the private and third sector will still be providing better value for money." However, he admits that this central tenet of the welfare-to-work reforms - that the private sector will do what the public sector does, if not better, then at least more cheaply - remains a "hunch" because there is not enough evidence to support it.
What evidence there is has been eagerly seized upon by ministers. A report by think-tank the Institute for Fiscal Studies in May 2008, which focused on the early PtW pilots, concluded that for every £1 spent on the programme, the Government reaped £1.51 in terms of savings on benefit bills and increased tax income. Former employment minister Tony McNulty said this claim was based on a "conservative assumption" that those getting jobs through the programme would remain in employment for an average of 70 weeks. But early results from the national rollout suggest this forecast is overly optimistic. DWP figures for Jobcentre Plus's PtW provision suggest that, of the 137,110 participants who had started a job up to October 2008, only 22,170 - 16 per cent - remained in their job for more than 52 weeks. Similar statistics on broker-led provision are not yet available, but critics say there is no reason to assume that these figures will be any different.
So far, in terms of performance and value, there is little evidence that the PtW programme is delivering what ministers forecast for it. It remains, as Mulheirn says, an "experiment". For the sake of the rising number of jobless and the strained public finances, one can only hope that the Government's hypothesis is ultimately proved correct.
Regeneration & Renewal's Tackling Youth Unemployment conference takes place on 24 November in Birmingham. Visit www.haymarketevents.com for details
WHERE NOW FOR WELFARE REFORM?
The travails of the Pathways to Work (PtW) programme have serious implications for the future of welfare reform.
Next month, the Government launches the first phase of the Flexible New Deal (FND), worth £236 million a year, which is intended to get the long-term unemployed back into work. As with PtW, the contracts will be based on a payment-by-results system, with 40 per cent paid to jobs brokers upfront and 60 per cent paid according to job outcomes.
Many of the PtW brokers have been successful in winning first phase FND contracts, despite their poor performance in the vanguard programme. For example, Working Links, which was awarded four FND contracts, had an average job entry rate up to October 2008 of 12 per cent for voluntary PtW participants and three per cent for mandatory participants - both figures well short of the DWP's 45 per cent target. Work Directions, awarded two FND contracts, averaged 16 per cent and five per cent - again nowhere near the DWP's target.
But under the FND, the performance expectations are even higher, with ministers stating that they expect brokers to support 55 per cent of their "customers" into jobs for at least 13 weeks and 50 per cent into jobs for at least 26 weeks.
In March, the DWP select committee concluded that the best-performing employment programmes would require a 37 per cent improvement in their results to meet these targets. The committee said it was "unconvinced" that the FND contracts were "viable" and that the expectation of such a significant step change in performance with a "significant reduction" in funding was unrealistic and could lead to the "real danger" of market failure.
In response, the Government boosted funding for the FND in the Budget. But Ian Mulheirn, director of think-tank the Social Market Foundation, says this extra funding only allowed for the threefold increase in the expected number of claimants moving onto FND as a result of the recession and the spike in unemployment, and does not allow for extra investment in each individual over and above what had already been provided. Last month shadow welfare secretary Theresa May, a strong supporter of the FND, warned it may no longer be fit for purpose in light of the recession.
But given the public spending squeeze, it will be difficult for ministers to make the case for more FND funding. Like PtW, then, there are serious questions about whether brokers will be able to deliver on their targets with the level of funding supplied. If they can't and they fail, then the stakes are much higher than with PtW because the FND contracts are much bigger. If a provider does get into serious financial difficulties, ministers will be faced with a dilemma: either allowing that provider to fold, or bailing it out.
Where did that come from? Copyrighted works should not be reproduced without permission.
Where can I get real evidence on the results Pathways is producing - both private and JCP led?
The DWP release official statistics on Pathways performance through their website, with a time lag of a bit over half a year.