Monday 18 June 2012

Redefining failure

One of the great advantages to government of flogging off public services is that the politicians are then not accountable.  Information is refused because it is "commercially sensitive".  Even at local council level, the taxpayers and the service users (and even councillors) are told that the details of contracts are none of their business.  The debacle over A4e highlighted the problems with this situation.  But for this government the Work Programme leaves them nowhere to hide.

Iain Duncan Smith spent years in opposition developing his theories on welfare.  Being in government has brought him face to face with reality.  But he can't afford for his theories to be proved wrong.  So, along with the imperturbable Chris Grayling, he has to insist, against all the evidence, that the Work Programme is proving a rip-roaring success.  The government can't afford for it to fail; it is the model for all future privatisation.  And if that means redefining failure as success, they'll do it.  The contracts, we are told, are strictly "payment by results".  But that isn't true.  The companies insisted on "attachment fees", an upfront payment for each starter.  Someone on the MyLegal website has analysed the finances and shown that A4e must already have received £25.3 million in attachment fees alone.  And if they are achieving only 10% job outcomes they are likely to have been paid around £32.8 million for getting 6,300 people into work.  But the dead weight figure (those who would have got work without any intervention) is reckoned to be around 25%.  When the government is finally obliged to publish figures it will be interesting to see how they get round that.  Then there's the fact that the contracts were supposed to involve small, local and charity organisations; but 28 of these have already dropped out, unable to make it pay.

What does increased "Mandatory Work Activity" do to the availability of actual jobs?  Never mind, there are plenty of jobs out there.  IDS, Grayling and other ministers trot out figures for the number of vacancies which bear an increasingly tenuous relationship with reality.  On 14 June IDS claimed that 500,000 new jobs are being added to Jobcentres every week.  The FullFact website has shown that this is simply not true.  JCP reckons it's about 10,000 a day; but any jobseeker knows that this doesn't reflect genuine job vacancies.

So annoyed is Iain Duncan Smith by the refusal of the real world to conform to his theories that he is increasingly blaming the poor for their poverty.  There's nothing new in that for the right wing of politics.  


  1. Without wishing to get too personal about the man, the expressionless Greyling (spelling intentional) is a perfect example of what is wrong with modern British politics. His refusal to listen even when presented with the plain facts is on the one hand astonishing and on the other predictable.

    For example, a few months ago he (Greyling) appeared on CH4 new and was interviewed by presenter, Cathy Newman who confronted him with a letter threatening sanctions if jobseekers did not partake in MWA. Greyling as per usual blustered and tried to make out it was a voluntary scheme. He even tried to claim he had not seen the letter from the DWP threatening sanctions for non compliance / attendance Newman had in her very own hands! Even when told his VERY OWN DEPT confirmed it was a standard letter, he refused to listen.
    See the full interview:

    Another example is the radio phone-in on BBC R5L around three months ago. out of 15 or 16 callers, emailers and texters, just one found the WP of any use. Not surprisingly, Greyling did not engage with ANY callers, and preferred the easy option of taking on his Labour shadow, Stephen Timms. When the host, Victoria Derbyshire pointed out to Greyling that the vast majority of people contacting the show had negative experiences of the WP, he had the nerve to suggest that those who had found employment via the WP did not have time to participate in phone-ins!!!

    Again, both Greyling the Guardians Polly Toynbee were invited to debate on Radio 4's PM progam after attacking Toynbee and labelling her a 'job snob'. Greyling refused Radio 4's invitation.

    An increasing number of people are not prepared to swallow govt spin without expecting ministers to be challenged in some way. When a govt minister refuses to acknowledge the plain truth and engage with others, one can only come to one overriding conclusion.

  2. There's no way that 25% is the dead weight figure! Sorry; you're making stuff up.
    I buy the argument about transparency and prevarication, but it risks being undermined by a stat that's obviously not true.

    If we want to criticise the work prog for being poor value for money during a recession when there's not much spare room in the labour market, we can't then have it both ways and claim that the hypothetical, wp-less stat would be a whopping 25 at the same time. Does that refer to the boom years? It certainly wouldn't be the case in a recession; for that to be so you'd be saying that people who go on the work prog have their chances of getting a job damaged by an enormous 250%! Say what you like about a4e etc, but that beggars belief.

    Really interested to know where you got that stat. If it's about the job market as a whole, you have to account for the fact that everyone on the work prog has already failed to get a job after 12 months of trying at the job centre; the only people with whom these providers are getting (or not getting) jobs are by no means representative of the average jobless person. They're a section of the jobless who are by definition not having an easy time of it. So the odds have to be adjusted accordingly.

    1. No, not making it up. See
      28% is the DWP's own figure. I've heard Grayling repeat it. Even if you lower it a little, there is still a considerable dead weight figure, however incredible you find it.

    2. Anonymous 18 June 2012 04:08

      "25 per cent.......
      an estimate of the percentage of people on previous schemes that actually found work"

      That is a statement made by the National Audit Office in their Executive Summary document in Jan 2012. The link to the whole thing is below:

      The NAO confirmed that they obtained the figures from the DWP.

      The NAO reported that they asked why the DWP had allowed the Primes to believe that the Primes were likely to be able to achieve success rates of around 36% under the Work Programme Scheme? From the sound of it, the DWP fudged round the question. The DWP hadn't suggested the 36% figure but the DWP had not contradicted it either, apparently.

      The NAO have expressed serious doubt about whether the 25% is likely to be exceeded. According to the NAO's own mathematical modelling, it won't be.

      On 08/02/2012 the Public Accounts Committee heard from Andrew Dutton of A4E:

      Mr Dutton said that A4E had been working on a profit of about 4% of the sums received by A4E under the previous W2W schemes, which is what had led to the whopping dividend payout to Emma Harrison of A4E.

      Will A4E protect that level of profit for themselves under the Work Programme scheme? The job outcomes matter less to the Prime contractors than the amount of profit that they intend to garner for themselves, I strongly suspect.

  3. With due respect, that's not a source. What is the source for it in the previous blog post?! I will bet it includes all jobless, not just those who make it onto the work prog. Likewise, i'll bet it wasn't calculated to be the case in a recession (since every government department seems not to have seen this coming). Do you see what i'm saying? Otherwise how do you account for the 250% damage figure?! You cannot be serious (though i'm sure some of your more excitable commentaters will be prepared to make that argument!).

    Prepared to be persuaded otherwise, but only with actual solid evidence. Anything from the department of work and pensions, in writing, on it?

    1. With due respect, it's not up to me to prove a well-sourced stat just because you don't believe it. With my own ears I heard Grayling say 28% - of those on the WP. The BCG used the DWP's own figure. Your "250% damage figure" is absurd. Anyone who has worked in W2W knows that a large number of the successful outcomes owe nothing whatever to the provider. Now, whether that amounts to 28% (or 25%), especially in this climate, I don't know. Neither do you.

    2. Speaking on Wednesday, Grayling could only state that among "section one" claimants - adults over 25 with no complicating factors such as criminal records or medical conditions - the job entry rate was above 25% "in many parts of the country."

      The statistics he mentioned seems to suggest that the number of people finding work through the work programme was slowing. In the first three months around 22% of people put through the programme had entered into a job - amounting to around 60,000 jobs.

      Of course this is Newspeak, Its not a Bad set of figures its Ungood..If something fails then alter the success rate.. If child poverty rates are going up then you change the categories. And there you go you solve the problem.

      Sending people onto "training" schemes, Sounds like they are training.. when in reality it has nothing to do with training..

  4. It's not about whether or not there's dead weight - clearly there is. If 25% is the dead weight and they're actually only getting 10% in (as you say), that means they're actively damaging people's chances of getting a job, and by a massive amount. Two and a half times fewer people are getting jobs because the work programme exists (that's 250%). As you say, it IS absurd. Something has to be wrong. You see? With dueduedue respect, it may not be 'up to you' to find a source, only it would make your argument more compelling. But there's no law on it, very much agreed.

    1. At this point I insist that you get yourself a pseudonym; I hate arguing with Anonymous.
      As Judi pointed out above, 25% was the average outcome rate on privatised New Deal; FND was slightly less. Why the DWP should then assume that the dead weight figure for the WP was MORE than that, I don't know, but they did. Now, the 10% figure was not an estimate of actual outcomes but a basis for calculation on the MyLegal site, to show that even at that very, very low rate the money is still coming in.
      The actual outcomes (running, we think, at around 22%) are low enough to make that conjectural dead weight figure look ridiculous. You can't argue from that that people are actively disadvantaged by being on the WP. It simply means that the climate for jobs is terrible and the WP far too optimistic.

    2. 1) The deadweigh could be more because
      a) The programme is longer than FND - people can spend over 3 years on WP which is more time than FND for people to find a job.
      b) What is counted as an outcome is "easier" - FND only counted one long job, WP counts a collection of seperate short jobs.

      2) Yes you can argue that people are actively disadvantaged by being on the WP.

      As one examlpe of why this might be just google "lock-in effect" and you will see a host of examples where schemes around the world aimed at helping the unemployed have actually increased unemployment.

  5. Both arguments are interesting. How would calculate the dead weight figure? How do they find out who has and who hasn't had support? Do the job center also run figures? i have comments by previous posters who seemed to encourage people not to show the support and historian you even commented that it was wrong. How do we know what figures are correct?

    1. We don't. It's all guesswork. But the government have to come up with some sort of figure in order to evaluate the programme.

    2. If there are figures available nobody is releasing the because "They are not allowed to under the contract" This in it self is confusing, as if the programme was a roaring success,in my opinion it would be all over the press.The other reason could be that the data has just not been collected.

  6. There is at least a clue as to "deadweight" figures contained in the DWP's Invitation to tender document which can be found here:

    "3.14 DWP will set a non-intervention performance for payment groups 1, 2 and 6 reflecting the number of job outcomes that would be expected to occur in the absence of the WP. This is calculated by DWP based on analysis of historical job entry rates.
    The non-intervention performance profile is:"

    There follows a table giving the deadwight figures over a 7 year period for 3 payment groups."
    It won't copy here without losing the format but the figures for JSA 25 and over are:
    Year 1: 5%
    Year 2: 25%
    Year 3: 30%
    Year 4; 30%
    Tear 5: 30%
    Year 6: 25% (After initial contract period but existing customers still finding jobs)
    Year 7: 5% (After initial contract period but existing customers still finding jobs)

    Overall a weighted average of 28% across all groups and over a 5 year period would appear reasonable.

    I'd say anything less than 28% should be considered an abysmal failure.


    1. So after two years the figure should be 25%- it takes that long for some to get jobs - so can't really say whether there is good or bad performance until middle of next year?

  7. Bob Holman, the activist credited with introducing IDS to poverty and showing him how decent people cope with it, has called on IDS to resign:

  8. And now to add to this disaster is G4S who you would think as a prime contractor could find enough people from their work programme to take on posts as security guards at the Olympic village. Just another mess up by one of our trusted prime I guess


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