27 November 2007 – Greater role for private and voluntary sector to tackle worklessness
Private and voluntary sector organisations will be paid to get the long-term jobless into long-term jobs, Work and Pensions Secretary Peter Hain announced today.
Signalling a radical change in the way help and support is provided to get the most disadvantaged into work, Mr Hain outlined proposals in the emerging findings of the DWP’s commissioning strategy which include a much greater focus on results-based payments to specialist providers.
The emphasis in the welfare-to-work market, worth around £1bn a year, will not just be on getting a person into work, but making sure they stay in work. This will require longer and larger welfare-to-work contracts, with a smaller number of lead contractors to achive this.
Mr Hain said:
“The private and third sectors, working with Jobcentre Plus, have a vital role to play in our hugely important goal of achieving full employment and eradicating child poverty. If we are to meet this ambitious goal we need to take a fresh approach that utilises all the talent and skill available to us. I believe our emerging findings will be supported across all sectors as being the right way to get people into work.
“My priority is what works best and providing value for money for taxpayers and I have seen what has worked and what hasn’t worked in the USA and elsewhere and we have also consulted extensively with existing and potential providers, interest groups and other government agencies here.”
“In the future the bulk of payments to contractors must be based on sustainable job outcomes. This will give a real incentive to help people into jobs that provide the greatest career prospects and the greatest chance to lift themselves and their children out of poverty.”
Other key initiatives will be:
- Generating increased competition for contracts with support provided by the DWP for the encouragement of new service providers into the market.
- A big role for high-quality, high-performing smaller providers.
- Greater accountability – there will be a number of points at which contracts can either be terminated or adjusted if performance is poor balanced with rewards for outstanding performance.
The plan builds on the recommendations made to the DWP by David Freud in March and the DWP’s own proposals in the ‘In Work, Better Off’ green paper in July.
The DWP also published today new research on welfare-to-work in the USA, which was drawn on as part of the emerging findings of the commissioning strategy.
The research by the University of Portsmouth contains findings of a review of literature on the contracting out of welfare to work services, with a particular focus on the experience of Wisconsin and New York City.
Notes to Editors
- DWP Commissioning Strategy – emerging findings is available on the DWP website at http://www.dwp.gov.uk/supplyingdwp/news/.
- It follows extensive consultation on proposals set out in July 2007 in the green paper on the next steps to full employment In Work, Better Off.
- During November, December and January we will work closely with a range of stakeholders to address the outstanding questions identified in this report. The final Commissioning Strategy will be announced in February.
- Contracting out welfare to work in the USA: delivery lessons is available on the DWP website at http://www.dwp.gov.uk/asd/asd5/rports2007-2008/rrep466.pdf
- For further information contact Eltan Halil in the DWP press office on 0203 267 5123.
DWP Press Office: 0203 267 5144
Out of hours: 07659 108 883
Website: www.dwp.gov.uk