Conservatives publish new reform proposals
Earlier in the year, Theresa May promised that the Conservatives would set out their own welfare reform plans in detail this Autumn. The party conference this week unveiled a new set of proposals, including various recession responses and an all-in-one support provision called the Work Programme. However, the question of what was going to happen to existing contracts and bid rounds was left open.
New programmes
The Work Programme
The Work Programme is intended to replace not only Flexible New Deal and Pathways to Work, but apparently all other DWP employment programmes. The start date in the budgeting information is 2010. The programme's features include:
- Referral immediately for the hardest to help and long term unemployed, at 6 months for 16-24 year olds, and after 12 months for those with recent work experience
- Lasts for anywhere up to three years instead of one to one and a half in FND
- Almost entirely paid on job outcomes lasting longer than a year, although 'given the more difficult conditions the financial markets now face, we would be prepared to work with providers to find a way to secure cash-flow funding. We are in addition prepared to fund modest service payments to providers when they take on clients.'
- Pays more for harder-to-help customers, using a categorisation system rather than an accelerator. 'The amount paid by the taxpayer to Work Programme providers to help an unemployed person into a job will therefore vary depending on a range of factors such as how long an individual has been out of the labour market, their health, and their skills'
- Has a budget of £3.6bn over the three years from 2010 to 2013, making it larger than all current DWP programmes combined
There is no detail on geography, although Theresa May has previously said that she was looking for smaller contract areas and sizes.
Emergency programmes
The whole idea of the Work Programme is to merge all of the support streams into one. The document claims that the Work Programme is also recession-proof because of its design differences from FND. This doesn't stop them from then laying out a range of emergency programmes to run alongside:
- Youth Action for Work - extra options for 18-24 year olds, referrable to by their Work Programme provider. The options themselves are slightly odd in places, e.g. expanding training places for 14-16 year olds, or placing people with sole traders on minimum wage
- Work for Yourself - self employment support, including mentoring, specialist provision and startup loans
- Work Together - volunteering network and brokerage
- Work Clubs - local community jobsearch support network, operating primarily through existing community organisations
Business-led training
The section of the report dealing with Apprenticeships and pre-Apprenticeships is a bit too far outside of the welfare to work side of things, but there's a separate proposal for training modules to be made available to Work Programme providers. These modules (Service Academy, IT Academy, and Young Entrepreneur Academy) would be designed and delivered countrywide by pre-existing partners such as Tesco, Microsoft, and the Bright Ideas Trust.
After the Work Programme
'Once the recession has ended, it is our intention that anyone who has been through the new system without finding work and has claimed the Jobseeker’s Allowance for longer than two of the previous three years will be required to join a mandatory long-term community work scheme as a condition of continuing to receive benefit support.'
What about the current programmes?
The document contains individual sections dedicated to highlighting the shortcomings of New Deal, Pathways to Work, Flexible New Deal, and the Young Person's Guarantee. This makes it fair to assume that none of these are going to be popular with an incoming Conservative government. What is less clear is how they propose to deal with them.
'An incoming Conservative government will replace the Flexible New Deal phase two with The Work Programme. We will also seek to renegotiate the Flexible New Deal phase one contracts to incorporate the principles outlined above.'
The current primes have spent tens of millions of pounds in bidding for and setting up the contracts, and are unlikely to allow the Conservatives to renege on them. The proposed contracts framework is different enough that a simple contract renegotiation is unlikely to succeed - who gets the Work Programme contract in an area with FND, Pathways to Work, CTF, Support Contracts and ESF programmes? Not to mention the Train to Gain and other skills contracts that will also be cut off?
James Purnell suggests that it would take lots of money to replace existing contracts by 2012, and simply wouldn't be possible before then. With this in mind, the Conservatives will face serious difficulty in fully implementing their agenda. This hasn't stopped them from budgeting on the assumption that everything will be put in place in 2010. It has, however, led to rumours that bidders are reconsidering their bids for CTF, and potentially FND2.
What about Jobcentre advisers?
The future of Jobcentre employment advisers is not discussed in the paper. There is a clear implication, both from the design of the Work Programme and criticisms of the New Deal Personal Adviser role, that employment support is regarded as being the domain of providers in future. This is justified by claiming that Jobcentre advisers are much less effective than contracted ones, with reference to 'Benchmarking the Use of Personal Advisers in Jobcentre Plus' by Christian Van Stolk, Jennifer Rubin, Jonathan Grant, May 2006, Rand Europe.
How much will it all cost?
The budget actually allows for an increase in delivery spend by £600m across all programmes, which it offsets by assuming that people being kicked off IB into JSA will save at least that amount. The existing contracts may make it both more expensive and impossible to set up in a short time frame.
Responses
The mainstream press have mostly reported the story straight, although quite a few have pointed out that it's very similar to the existing Labour welfare reforms. The specific issues around replacing existing contracts, or simplifying then re-complicating delivery, have not been picked up on.
- Shaw Trust's response is in the comments below.
- Dan Finn welcomes some proposals, joins general disbelief over the implementation, points out silence on conditionality, contract sizes, future of JCP advisers
- James Purnell responds with a fairly accurate takedown
- Fraser Nelson of the Spectator agrees with Purnell, also lambasts the proposals for not taking the recent Centre for Social Justice report on board
Resources
- The Conservative story on the proposals. The full paper is available from this page
- The FT has a good piece on the impact and deliverability of the plans
- Times coverage
- BBC News coverage
- BBC journalist picks up on the obvious similarities between the Conservative and Labour platforms
- Off-topic, but the government are planning a white paper on skills. Current FE college courses more often lead to unemployment than work, and it appears that training in some subjects may even reduce employability.
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Comments
I quite like the general set up of what they've proposed. The New Deal mindset is so ingrained and familiar now I had to read it twice before I understood it though, which in itself is probably a comment on how "cosy" the whole thing (ND) has become. Not totally convinced on their costings which seem to rely on £600m savings from imposing more stringent criteria on those claiming ESA - seems a little on the optimistic side unless they're going to be incredibly tough. Nevertheless I'm so heartily sick of what this Government frankly that if the only other option to Gordon Brown was Barry Chuckle I'd probably still vote for him.
Incidentally, the Tories proposals also link strongly to their whole approach on skills, which probably deserves some comment. Don't want to make the first posting take this whole thread off at an angle though, so I might start something somewhere else on this. (Unless anybody else wants to take this thread off at an angle of course, in which case I'll readily join in.)
Thanks Raven. I still need to put the detail of the Conservative proposals up, as the summary above doesn't fully capture it. I haven't found anything about how they're going to handle all the existing contracts, and I can't imagine they'll get unanimous agreement from all the contract holders.
Apparently Theresa May has just announced at the Tory conference that she will refuse to sign the FND2 contracts - that might make al the work that is going to be done over the next couple of months a bit redundant.
Just read their 68 page document. FND1 contracts would be renegotiated to deliver the Work programme - work for your benefit at 6 months for 18-24 yr olds, 12 months for 25+, all other contracts scrapped. 100% outcome funding, possibly a service fee element to ease early cashflow, but sustainable job outcome means 12 months in work. Provider has responsibility to customer for 3 years whether in or out of work. JCP Advisers and any inhouse employment initiatives put out to private sector. A return to good old Job Clubs, but voluntary ones with only 2 paid members of staff (suggests manager and finance bod), tutors to be community volunteers based in what ever premises they can get cheap - grant type funded based on agreeing to the mission stetement, not contract payments. Boris to test it out in London. Looks like good news for Colleges; self employment advisers (if the adviser gets onto the approved list for the self employment programme -don't think they will call it Enterprise Allowance though!) ; and sole traders who can have a 16-19 yr old for 6 months (there's a career for some in vertical shaft carbon removing -chimney sweeping, or aqua vessel containment and support work - window cleaning bucket holder)!). Whatever happened to TOPS training and YTS, they are the only two I can't see in this set of proposals.
Best thing though is only two, or could be three or four - five if you are being picky, programmes rather than the bewildering and overlapping plethora of programmes, pilots etc there are now.
But thankfully Daniel will give us a more detailed and balanced summary.
Theresa May Speech today. She will not sign off fND
So let me make clear to you now what we would do in government:
ONE
We will retest everyone on Incapacity Benefit and make sure they are receiving the right level of benefit. That means for those who are found to be fit for work there will be a cut in their benefits of up to £25 a week.
TWO
We will give help faster to those who need it most - the young and long term unemployed.
THREE
We will use experts from the private and voluntary sector to get people back into work. And we will only pay them when they have moved someone off benefits and into a sustainable job.
FOUR
We’re going to offer proper support and so we expect people to keep their side of the bargain too. If you can work, and you refuse to, you won’t get your benefit. With so many people genuinely relying on welfare at the moment it’s not fair for other people to be playing the system.
FIVE
We will sweep away Labour’s complicated and bureaucratic New Deals and introduce one simple integrated back to work programme for everybody.
These changes need to happen as soon as possible. That is why I am determined that should the Conservatives win the next election it is essential that we do not sign the country up to five years of Labour’s failing welfare to work programmes.
If David Cameron asks me to be Secretary of State for Work and Pensions, I will not be signing the contracts for Labour’s flawed flexible New Deal.
I’m sending a message today that under our watch we’ll demand more, from providers, more from benefit claimants, and more from government.
Cameron brands Labour 'party of unemployment'
By Nicholas Timmins, Public Policy Editor
Published: October 5 2009 03:00 | Last updated: October 5 2009 03:00
Could not copy and paste link; FT allows individuals to read about one article before you subscribe for free to access others. Copy and past heading to go to article that gives details of problems with implementation of new policy in relation with current contracts:
Purnell gives good insight on this. The article recons it will be about 2012 till the conservative policy is implemented re welfare to work.
Shaw Trust responded to the proposals almost immediately:
Well said, Shaw Trust.
"Our real concern is that no-one on benefits gets left behind." ... like the little lame boy did in the Pied Piper of Hamlyn. Those evil conservatives. I blame Thatcher.
Interesting they want tough talk to employers to match tough talk to claimants - Im not sure if the employer will ever be mandated to do much beyond the chinless DDA.
Perhaps the Conservatives should look in the mirror and scrap Trident, saving us over £50billion, then we can all go on the sick and still be a richer country. That would get rid of the stigma alright.
Lets face it - Trident is hardly a deterrant to Osama now is it?
@Onthedarkside - that seems a fairly balanced summary to me! Not convinced that the Work Programme is the same as Work for your Benefit, otherwise fine. The emergency programmes, the ready-rolled training routeways and the implementation strategy are wacky funtimes, but the general principle of the Work Programme is fine. After all, versions of the main changes are being tested by the DWP in the form of the Personalised Employment Programme and Invest to Save. I still want to see what they do with the Centre for Social Justice proposals, as Iain Duncan-Smith may have a chance to actually do something with his plans in the next Parliament.