The Work Programme: inside the 'black box'

Today’s Work Programme results reopen the debate about whether it is actually working. As in November, when the first set of results was published, many will point to missed targets and argue that the programme is failing. Providers are only hitting minimum performance targets in 18 of 40 government contracts. Others, including the Department for Work and Pensions (DWP), will say that these targets were always too optimistic given economic conditions, and point out that the Department is spending less for each person placed in work than in previous programmes and that results are improving swiftly. The debate is unlikely to be conclusive. The reality is that the programme has not been set up in a way that makes it easy to evaluate, with every area of the country being subject to similar arrangements, if different providers. What’s more, the rush to get the programme off the ground quickly meant that, unlike its predecessor programmes, we do not even have evidence from pilots to draw on. It’s also not clear if the results will lead DWP to remove underperformers. Under the terms of the contracts, DWP can take away any of the 22 contracts where providers fail to hit the expected minimum. In practice, however, removing all 22 would be highly disruptive and removing just a sample may lead to legal challenges, something the department has always gone out of its way to avoid. Failure to act will lead to questions about who pays for failure, given that it is the taxpayer who pays the benefit bill for provider underperformance. The debate is also less informed than it could be, largely due to the limited amount of data published by the department and ongoing presentational difficulties. DWP has improved how it shares Work Programme results. Crucially, the department appears to have realised that releasing the data infrequently is politically counter-productive. Our research on the Olympics shows that providing regular updates to the media and opposition not only creates a climate of openness, but means that there are “no big surprises” for the media, public and parliament to pounce on. In light of this, DWP’s decision to publish performance data quarterly from now on seems sensible. But there remain major gaps in the data provided. First, we have no idea how much money individual providers are getting. In fact, DWP does not even publish any overall expenditure figures alongside overall performance data. Second, we have very little insight on why some providers are doing better. Most ‘prime contractors’ rely to some degree on other companies and charities to provide frontline services – and often it is the different performance of these providers that explain overall performance differences. The value of publishing cost data is obvious: it is an important part of the value for money equation. The department clearly has this data but feels it can’t publish it because of concerns over ‘commercial confidentiality’. Our research on the Work Programme (published next month) suggests that understanding – and sharing - data on prime contractor supply chains is also important. First, providers get to spot which sub-contractors seem to be working well for their rivals and can compete more vigorously for their services, raising standards across the board. Second, the department can spot whether there is a healthy pipeline of sub-contractors – and can actively enable promising providers to grow and eventually compete for national contracts. Third, the public and the media can understand whether claims that small and voluntary sector providers have been squeezed out of providing employment services are true, as a range of anecdotal evidence implies. Here, the department may again be prevented from publishing the data by commercial confidentiality concerns but in all likelihood DWP does not even have this data. Ministers and officials have embraced the idea of ‘black box’ commissioning, where the department is only interested in job outcomes not how contractors deliver outcomes. Both data gaps need to be addressed – or at least re-examined. Several providers we interviewed in our research suggested that they would be open to the publication of cost and supply chain data. Other interviewees suggested that the ‘commercial confidentiality’ explanation for not publishing this data was, to a degree, not valid. These issues do not, of course, simply relate to the Work Programme. Government is increasingly commissioning public services from a range of public, private and voluntary sector providers – rather than directly managing its own public service offering. Given this shift, the question of transparency needs urgent examination.