Working to make government more effective

Comment

Eight ways to improve the Work Programme

Tom Gash believes it can improve.

The Work Programme has some strengths, but Tom Gash believes its next iteration presents the opportunity for several much-needed improvements.

In 2010, the Coalition Government launched its Work Programme, which promised to get the long-term unemployed back to work. It was announced as “a revolution in back-to-work support” but built on two decades of experience in commissioning similar services. A number of previous employment services were consolidated into one national programme, outsourced by the Department for Work and Pensions (DWP) to twenty-or-so providers. It also increased the degree to which the payments depended on whether people got work and stayed in it. The contracts were let in 2011, and today two or three providers work in each of the government’s 18 “administrative regions”. These providers are free to subcontract work to other organisations, including specialist providers who had skills in working with specific groups, such as those with mental health problems. The success of the Work Programme is not entirely clear, as we reported in our initial assessment of it in 2013. As is too often the case, the Programme was not set up in a way that makes it easy to evaluate because there was no pilot and everyone eligible for support receives it – meaning government has no way of comparing results for those who receive support with those who don’t. We can therefore only compare results with those of previous programmes, which were usually delivered against somewhat different economic backdrops and glean insights by comparing the performance of different providers and the success different groups have had in finding work. During a Work and Pensions Select Committee hearing that several employment experts and I spoke at yesterday, the consensus emerged that the programme underperformed initially but performance has improved. The programme is also seen as working much better for some groups than others, with the panel universally confirming that those who were quite far away from getting a job weren’t given as much help as they needed. With the Work Programme contracts due to expire next year, DWP is currently planning the next iteration of its programme of support for the long-term unemployed. The Department is also reviewing its related Work Choice programme, which is a more targeted programme aimed at helping those with disabilities. As with any major change in approach, DWP should be sure to follow our ‘fundamentals’ of successful policy and heed the lessons of effective implementation. More specifically, DWP should take the following eight steps to ensure success:

1. Innovate but avoid a ‘big bang'

One of the reasons Work Programme’s initial performance was poor (and probably worse than the programmes it replaced) was the scale and pace of its implementation. Providers had to open new offices, relocate staff, get to grips with new financing, payment and subcontracting models, and establish relationships with clients and other organisations in just 12 months. If there are major changes in approach this time, it would be worth taking time to ensure a smoother start and trialling the most innovative changes in just a few regions or cohorts.

2. Be much more transparent

DWP does publish some data on the Work Programme but not enough. The next round of contracts gives government the opportunity to honour its promise to trial a version of the new transparency clause that we produced in consultation with lawyers Dyson Bell and representatives of industry, government and civil society.

3. Take service user feedback seriously

Greater transparency should include publishing data on users’ satisfaction with the service they get. Feedback from users is a good way of spotting where providers are ‘parking’ users who are harder to help into work. Arguably, new contracts could introduce rewards for improved satisfaction too – though these would need to be designed carefully (see point 5).

4. Take a cross-government view

Many of those who find it hardest to get into and keep jobs have other needs – for example, around healthcare or skills. DWP must ensure that other departments are involved in designing the programme and that the new programme allows a more seamless experience for those users with multiple needs, which we are exploring in a new project. Similarly, DWP will need to understand suppliers from a whole of government perspective. Several Work Programme providers now provide outsourced probation services, for example. They may be able to provide services more cheaply because they can co-locate their operations in one office and share IT and management systems. DWP needs to understand this – and balance the potential short-term efficiency gains of rewarding these providers with more work with the potential reduction in competition that will flow from this type of amalgamation in the longer-term.

5. Ensure local government and city-regions are involved

This is another point about open policymaking but because of the interactions between the Work Programme and local public services, this programme will need to take into account local priorities and programmes. While big bang devolution of the Work Programme budgets to cities or regions would probably result in performance dips in places with limited experience of commissioning employment support or other services, some form of ‘co-commissioning’ in a selection of areas with capable staff might also be a good way of government making good on its decentralisation promises.

6. Reward outcomes, but not ‘deadweight’

One flaw in the design of the Work Programme was that it paid people for getting people into work, even if they would have got a job without any support. Another was that payments for helping harder-to-employ people into jobs were insufficient to incentivise providers to invest – leading to ‘parking’ or at least inadequate support for those furthest from the labour market. The payment approach clearly needs to be revised. Most simple is to ensure that there are no payments for the small number of individuals who would be likely to get work anyway (and bigger payments for everyone else). In yesterday’s Select Committee many respondents favoured a more radical approach, however, involving early assessment of individuals to determine how far they are from the labour market and then varying payments based on their individual characteristics (rather than just the type of benefit they are receiving). This approach will be very hard to get right but a version of it operates in Australia and it could be trialled in some way during the next programme.

7. Ensure it can be evaluated

Despite the political and legal challenges, withholding services from a sample of service users would enable the creation of a genuine baseline and show how well the programme is performing. Social policy experiments have many benefits and it is worth engaging the public in a debate in order to build public appetite for experimental government. In lieu of a purist experimental approach, it is still worth engaging early on with those currently trying their best to evaluate the programme to see how the next programme can be designed to facilitate more accurate assessment of value for money.

8. Don’t forget ongoing market stewardship

It’s certainly worth investing time and energy in getting the design of the next programme right but ongoing stewardship matters too. DWP should be more assertive about moving work away from failing providers during the course of the contract. It should share information on which providers (and particularly which subcontractors) are doing a good job and why to allow good subcontractors to win more work and all providers to learn. And the Department must ensure that other DWP and cross-departmental initiatives complement (rather than conflict with) the programme. Continuity of those in charge of the programme will help here. Those leading on programme design should be able to stay involved for at least three years and ideally for the whole life of the contracts. Cabinet Office rules now allow for retention bonuses and these should be used, if required.

While we’re on the subject of innovation, it’s worth mentioning the fact the Work and Pensions Select Committee is showing signs that it is already changing its approach to scrutiny. By taking evidence about what should replace the Work Programme and writing a report before DWP announces its own plans, the Committee is ensuring that its recommendations can feed into DWP’s decisions, avoiding the typical problem of entering the scene when it is too late to influence change. This is the kind of practice Hannah White commended in her report and advice on innovations in parliamentary scrutiny and it is a welcome step that other new chairs may want to emulate. We should all hope that the DWP is as willing to change some of its historic practices and to learn from the past years – and decades. Read more: Transparency in the Work Programme Early evaluation of the Work Programme and other public service markets Our briefing note on ways to improve the performance of outsourced services in the 2015 parliament Work on the history of outsourcing in employment and elsewhere: Ways of ensuring diversity and innovation in commissioned services Better policymaking Open policymaking Routes to effective parliamentary scrutiny Resources for select committee members

Related content