The Work Programme Part 1 – Worse Than Doing Nothing

This is the first of a two part blog on the Work Programme. This part looks at this week’s data release, and part 2 will look at some of the tricks Work Programme providers seems to be using to ‘enhance’ their figures.

This week, the DWP finally released the first performance figures from the Work Programme, the Government’s flagship welfare to work programme, and boy were they poor. In the first 12 months of the programme, just 2.3%* of people referred to the Work Programme have found work which lasted for at least 6 months.

At the outset, the DWP estimated that if the only support long term unemployed people received was the standard Job Centre Plus offer (basically access to job points and fortnightly signing meetings), then 5% would find sustainable work anyway. The Work Programme providers had a minimum performance target of 5.5%. DWP expected this to be exceeded, but in fact every single provider has failed to meet this contractual obligation. What this suggests is that the Work Programme is worse than doing nothing. Read that again. Worse than doing nothing.

As you might expect, the Government and the providers themselves tried to put a positive spin on the numbers, arguing that since the programme started, 207,000 had moved into work at a cost of £2,000 per job, and over half of participants had had a break in their benefits since starting the programme. Ian Duncan Smith in particular likes to think if someone has come off benefits, they must have moved into work, but lets just look at those figures again.

878,000 people have been referred to the Work Programme, and 207,000 (according to the providers) have had at least one job start since starting the programme (24% of those referred). And yet around half (which equates to almost 450,000) have had a break in their benefits. So less than half of those coming off benefits actually found work. Is the Work Programme about finding people work or getting people off benefits? Providers seems to be more successful at the latter than the former.

If we take the 207,000 figure at face value, does this signify success as is being suggested? We know that in the first 14 months of the programme, 31,000 people moved into work and stayed there for at least 6 months (or 3 months in the case for former ESA claimants. To do this, they must have moved into work by the end of Jan 2012. ERSA (the industry’s trade body) helpfully break down job starts by month, so we know that up to the end of Jan 2012, just over 64,000 individuals started a job, but of these ‘jobs’ only 48% of them lasted long enough for the providers to claim a job outcome payment. It’s probably slightly worse than that because providers can still claim a payment if an individual gets a job, leaves it and starts another. So if someone does 3 temporary jobs lasting 2 months each, the provider can claim that as a job outcome. What sort of jobs are they that so many last less than 6 months? It seems that the definition of ‘job’ seems to be changing. I’ll explore this a bit more in part 2.

Looking at the Government’s chief argument then – value for money, while the headline number is £2,000 per job, if you break that down, it’s about £14,000 per job sustained for 6 months or more. Let’s not forget too that of the over £400m paid out to providers in the first 14 months, at least £350m took the form of ‘attachment’ payments – the £400 or £600 providers receive per participant just for accepting them on the programme. Ultimately though, the value for money argument is spurious, because as we’ve already seen, if we had spent nothing on welfare to work programmes, we would have expected more people to move into work. Once more then, the Work Programme is worse than doing nothing. The Work Programme seems to be very good at shifting public money into private hands, but less so at the job it’s apparently designed to do – finding work for people with complex needs.

That’s Part 1 then. Part 2 will go into more detail about the problems with the programme, why it’s such awful value for money, and what an alternative might look like.

*UPDATE: Via Twitter, @boycottworkfare points out that the performance figure for the first 12 months is not 2.3%, it’s actually worse, only 2.1% See this Fullfact post for an explanation.

Sources

ERSA – The trade body for Work Programme providers

DWP ad hoc analysis of numbers of individuals starting Work Programme and then having a break in their claim. (As an aside, I have a real problem with the DWP’s use of ‘ad hoc analyses’. They seem to be being used to muddy the waters about what is really happening, the opposite of what statistics should be used for. My very first blog post was on this topic. Read it here.)

DWP official Work Programme statistics

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