Volume does not equal capacity ... says A4E's Rob Murdoch

In the first of a series of articles by leading industry figures, Rob Murdoch from A4E argues that the whole sector is facing grave uncertainty. The drop in FND1 volumes and the dramatic downwards readjustment of predicted volumes for FND2 threatens to diminish the industry's future capacity to meet the number of economically inactive people who need help.

Rob writes:

There is one certainty in economic modelling – that the predictions will not be correct. The dramatic effects of this truth have been seen most recently in the meltdown of the financial sector, but it is not a modern phenomena. Even the great Keynes lost everything in 1920 through currency speculation. However it is the ability to learn from these mistakes that is the real measure of how we have developed.

The UK welfare market is currently struggling with a significant drop in the expected volumes of customers in FND Phase 2, as well as lower than predicted volumes in Phase 1. While this should come as no surprise given the secretive nature of the volume forecasting tool, DWP’s track record in prediction and the fact that the commissioning process took place in what now seems a by-gone age – what is most disappointing is the short term nature of the response. Rather than cutting volumes now, the Government needs to harness the capacity within our industry to meet the current economic and social challenges we face.

Prime contractors and their suppliers geared up to ensure that the new delivery met expectations – and we have seen some excellent new delivery sites, fantastic people, innovative systems and renewed motivation throughout the sector. We have also seen exciting developments as welfare providers, delivering front line services with the most marginalised people, have led the field in new ways of addressing issues of health inequality, reoffending, debt reduction, skills development, sustainable housing, engaging young people and much, much more.

The capacity of the welfare sector and the professions who operate within it offers significant opportunities for these challenging times. As an industry we can demonstrate that putting the customer at the heart of how we operate does not only deliver better long term outcomes, but brings significant cost savings and increased revenue for the Treasury.

The 5 giants that Beveridge attempted to slay with the introduction of the welfare state still exist today – just with different names. The aim was to pool resources to tackle our needs collectively. Important that we remember the greatest opportunity to support the 8.1 million economically inactive people in the UK is to harness the capacity of the welfare to work industry. If we can join up services around the customer and not around the needs of Government departments, there will be far fewer places for the giant of bureaucracy to hide.