flexible New Deal

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Flexible New Deal will be operating across half the country from October 2009. These are the key points from the contract specifications:

<h2>Contracting</h2>
<ul><li>Flexible New Deal replaces ND25+, NDYP, ND50+, ND Musicians, PSL New Deals, EZs, and appears to replace ND Self Employment as well. NDDP has just been recontracted and will function separately, as will ND Lone Parents.</li>
<li>All but three areas will operate under Customer Choice. This will help prevent the regional monopoly issue that has been raised as an objection to large-scale contracting. However, it doubles the overheads and will make delivery much more expensive in these areas.</li>
<li>Areas not covered by flexible New Deal phase 1 contracting will presumably have existing contracts extended until phase 2 takes place, although this has not been announced.</li>
<li>New Deal may be partly ESF-funded, and is thus not clean for match funding.</li>
<li>Payment model - 20% of contract value as a monthly service fee, 50% for 'intermediate employment outcomes' and 30% for 26 weeks job sustainment.</li></ul>

<h2>Delivery</h2>
<ul><li>New Deal entry is at one year, or 6 months for fast track customers. Provision for New Deal repeaters is being looked at separately. New Deal lasts for one year.</li>
<li>Providers will own action planning throughout New Deal, all of which will be mandatory and backed by Jobcentre sanctions once agreed. Jobcentre delivery will essentially be limited to signing on fortnightly and co-ordinating some aspects of childcare.</li>
<li>The actual delivery content is open. At least 4 weeks of full time work or placement must be undertaken during the year. However, all the FTET, VSO, BET, GtW stuff is no longer required.</li>
<li>Whatever content is delivered, must play nicely with the agency that replaces LSCs, and with City Strategies, Local Employment Partnerships and the like. Providers are responsible for paying travel, childcare, food etc. but benefits will likely still be paid by the Jobcentre as they handle signing on.</li>
<li>Referrals and other data will be handled under a new electronic system to replace the paper-based SL2s and nominal rolls that have had thousands of administrators squinting at unreadable faxes and five-part forms for the last decade.</li>

</ul>

<h2>Interpretation</h2>
<ul>
<li>Given that the smallest possible contract value is Â£5m per annum for five years, providers with turnover less than Â£10m seem distinctly unlikely to meet the capacity requirements to become a prime contractor. See the separate analysis of <a href="http://indusdelta.co.uk/wiki/cashflow_and_welfare_to_work_provision">cashflow and welfare-to-work provision</a>.</li>
<li>It seems likely from the delivery spec that the New Deal Personal Adviser role is being transferred to providers, although some existing NDPAs will probably be used to deliver the Gateway stage preceding New Deal entry. The PQQ documentation makes it clear that providers will need to agree to full pension protection as part of any TUPE transfer of DWP/JCP staff, and must not operate a 'two tier' workforce with JCP transferees on substantially different conditions to other staff.</li>
<li>Greater Manchester looks like the best contract by some distance, given that urban areas are historically much more lucrative than rural delivery, and Customer Choice increases risk and lowers profitability. A4e is the most obviously well-placed provider in this area.</li>
</ul>

Update 1st April - Cheshire &amp; Warrington has apparently been taken out of the bidding round.

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