Pathways - why it's not working

When delivering a public service such as helping the unemployed to find work there will be some crucial differences between public servants and private contractors. These differences are highlighted in a report on Pathways to Work, which looks at the "impact of outcome-based contracting". Pathways is a programme to help people with health or disability problems. The report, done by the Policy Studies Institute for the DWP, says that the programme is failing for a number of reasons. The Jobcentre Plus website says: "The help is tailored specifically for each person taking part in the programme." But instead what's happening is "creaming and parking". Inevitably, if you pay by results, i.e. job outcomes, contractors will cream off the clients most likely to get jobs and park the ones who have little motivation or who have serious problems. The economic situation has meant serious financial problems for the contractors. "As providers were not meeting their performance targets and service fees were not sufficient to cover running costs, it was widely reported that prime and partner delivery organisations were experiencing financial strain as a result of the contractual agreements." It has also meant that the prime contractors are leaving it to their sub-contractors to deal with those clients with specialist needs. "Service innovation on the part of prime providers was largely focused on reducing operational costs and achieving performance efficiencies." The conclusions of the report are polite but pretty damning. But they don't include the scrapping of these contracts and returning the service to people who are resourced over the long term and are motivated by the desire to do a good job and deliver a service to the public.

Famous, Rich and Jobless

More details have been published of this series. "Back to work tsar and chairman of A4E, which rehabilitates the long-term unemployed, Emma Harrison is to appear in a new BBC TV series, Famous, Rich and Jobless where ‘unemployed’ celebrities will experience joblessness." Given the list of celebs taking part, it reminds you of "I'm a Celebrity, get me out of here". And all lovely national and international publicity for Emma and A4e, paid for by our licence fees.

Contracts and Amin

There is some confusion at the DWP over what to do about contracts which are in the pipeline. Yesterday it was announced that the publication of results of bidding for Work Choices has been delayed. (This is the programme which replaces Workstep, for those with support needs in employment.) But today the providers who have been successful at the PQQ stage of something called the "progress2work-LinkUP and Welfare Reform Drugs Recovery Pilot" have been published. What is that? There's a partial explanation on the DWP's website. The results here show that A4e have been shortlisted in 11 of the 19 contract areas. So while, as we reported on 19 February, the government is pressing ahead with pilot contracts for integrated "Personalised Employment Programmes" it is persisting, or perhaps not, with specialised provision for those with special needs.

Perhaps we should look to places like Israel to see the future here. An article in the Jerusalem Post describes A4e's success there (where the company is called Amin). Bearing in mind that this is probably a PR piece like those which the company gets into British local papers, it is an interesting description of the regime for the "chronically unemployed" (how long before that phrase appears over here?). And it points out that the Israel contract (won in controversial circumstances) "led it to expand to other countries, including France, Germany and South Africa, and even has the company looking toward expansion to India."

PS: I received a comment from someone who claimed to have taken part in the forthcoming "Famous Rich Jobless" programme. If that person will send me another comment (it won't be published) with some evidence, I'll consider it.

"We've got the funk!"

That's the title of a story in the Star, Sheffield's local paper. I really can't think of anything sensible to say about it, so I'll leave you to read it here.

Can this be true?

This item has just popped up on the Telegraph website, in the City Diary section: "I understand one of the Government's favourite private sector partners Emma Harrison of A4E (it gets the long-term unemployed back to work) is preparing a new BBC TV series called Famous, Rich and Jobless where Emma deals with the work issues of the, well, rich and famous. First up on the show is Oasis rocker Noel Gallagher's ex-wife Meg Matthews, EastEnders actor Larry Lamb and society girl Emma Parker Bowles. Best of luck." OMG, as they say.

Two new contracts

With a general election not much more that 2 months away, the government is pressing ahead with new contracts in the "welfare-to-work" area. The DWP has announced the shortlisted bidders for two contracts, and A4e are on both shortlists. The first is for round 2 of the Community Task Force, which is responsible for work experience placements under the Young Person's Guarantee. 43 organisations have their hats in the ring for this one. The second contract is for the Personalised Employment Programme. The DWP describes this as follows: "The Personalised Employment Programme will combine provision for JSA claimants, ESA claimants and parents with younger children in a single, integrated, flexible employment programme. Through this multi-client group contracting approach the pilot will test a radical new way of tailoring support to individual needs and helping those with multiple barriers to employment back to work. The pilots will also trial the conditionality framework recommended in the Gregg Review and we are exploring the feasibility of testing an innovative ‘accelerator’ funding model in the Personalised Employment Programme pilot areas."

There is a fuller description at the tendersdirect site. The shortlists have been announced for two contract areas, in a pilot for a scheme to replace existing New Deal and other provisions. Whether a new government will press ahead with this remains to be seen.

Insight, prisons, quangos and unemployment

LDC is a private equity company and it is part of the Lloyds Banking Group (much of which you and I own). It wanted to support a management buy-out of JHP, a training and skills company which has been in existence for 25 years and is a competitor of A4e. So who better for LDC to bring in to do the due diligence than A4e? Its Insight consultancy arm "was able to draw on in-depth understanding of both the employability and skills markets, and used its knowledge and experience to provide detailed insight into the likely prospects for JHP". Yes, of course. And A4e "were also able to provide a unique insight into JHP’s positioning as an integrated provider of both employability and skills, an area of increasing importance to policy makers in all parties."

LDC went on to invest in JHP, so they were happy with what they learned. Now, I'm probably naive about such things, but isn't this a bit like asking Tesco to tell you whether it's worth investing in Sainsbury's?

The latest edition of that excellent publication Private Eye has two items which touch, albeit indirectly, on A4e. The first concerns prison education. A4e had a number of contracts including 8 in Kent; but it pulled out of those early because it was losing money hand over fist. They were taken over by Manchester College, which is now the largest provider with contracts in 96 institutions. Now they too are losing money and having to sack teaching staff. "Not all colleges failed to foresee the hidden costs," says the Eye, pointing out that two London colleges withdrew from a tendering process because there wasn't enough money in the contracts. But this is surely a case of the inability to undo a botched privatisation.

The second item concerns the PADA (Personal Accounts Delivery Authority). We reported that this quango has the job of enrolling millions of low-paid employees in a pension scheme based on stock market investment. One of its first actions was to dish out a large contract to 35 firms, including A4e, to do market research. PADA has become what the Eye calls an "old mates' club", staffed by people with surprising CVs who just happen to know each other. It's worth reading the article; it's entitled "Nest of Vipers". Let's hope that if David Cameron becomes PM he keeps his promise to do away with all these quangos.

And finally -- the unemployment figures which came out in recent days included the fact that "long-term unemployment, covering those out of work for more than a year, increased by 37,000 in the quarter to December to 663,000, also the highest figure since 1997." (Channel 4 news). So what is the point of New Deal?