Select Committee on Education and Employment Appendices to the Minutes of Evidence


Memorandum from Tomorrow's People


  1.1  Tomorrow's People, a national charitable trust, was established in 1984 to help unemployed people to work. Since then, we have helped over 324,000 job seekers to find employment. We do this by providing access to skills that enable the unemployed to enter and compete successfully in the labour market.

  1.2  Tomorrow's People has a well established network of links and partnerships with employers (including Unipart, Zeneca, Littlewoods and Burger King), as well as the Employment Service, Training and Enterprise Councils, and education.

  1.3  Since its launch in 1997, Tomorrow's People has been active in delivering all aspects of New Deal for Young People. During this time 164 young people have started on New Deal through Tomorrow's People and we have delivered 1,560 Gateway modules. We are therefore pleased to be able to contribute our views to this inquiry.

  1.4  Tomorrow's People has had a long history of delivering support to unemployed people through a range of government programmes and initiatives. We therefore welcomed the development of New Deal as an opportunity to move unemployed people from welfare into work.

  1.5  Tomorrow's People also lays great emphasis on the development of links with employers. Indeed, Tomorrow's People is increasingly playing the role of intermediary between employers and unemployed people. This is perhaps best reflected in our Corporate Workroute initiative. Through this and other initiatives, Tomorrow's People has sought to directly engage employers, many of which are household names, in providing opportunities for the unemployed.

  1.6  Through this work we have also developed a clear understanding of the requirements of employers and the problems that they face in supporting initiatives such as New Deal. We strongly believe that active support and engagement of employers is crucial to the success of New Deal and have therefore reflected some of the issues raised by those employers with which we work.


  2.1  It is our experience that the success of New Deal has been variable. This very much accords with performance information published by the Employment Service which shows variable success rates across the country. We are aware that job entry rates into sustainable jobs for young people on New Deal is around 33 per cent nationally. This accords with our experience, although we are able to point to a number of examples where the job entry rates exceed this figure. For example, the following New Deal projects involving major employers have yielded the following success rates: Unipart, 70 per cent; Burger King, 56 per cent; Liverpool SMEs, 86 per cent. Set out below are some issues which we believe have impacted on performance.

2.2 Poor levels of referral

  Many of our operations report that the numbers of New Deal clients referred to them by the Employment Service have been lower than expected. This makes it difficult to secure the range and choice of provision to meet the needs of young people. A further impact is also that many employers, who were initially enthusiastic about New Deal, were then disappointed when they were unable to recruit New Dealers. We have some evidence that employers walked away from New Deal as a result of these early disappointments. We believe that the numbers anticipated were not realistic and so levels of expectation were raised, both with providers and employers. With providers who established levels of overhead to cope with anticipated volume, this will have lead to financial difficulties. This "risk" element was all in the lap of providers. We believe that risk should be shared.

2.3 Retention problems on Gateway and Options

  In some areas we have had reports of problems of retention rates both in the Gateway and on New Deal Options. In one area retention on Gateway modules was only 60 per cent and on one FTET programme none of the clients completed the programme. This is the case even for mandatory programmes and concern has been expressed that the Employment Service has been reluctant to impose sanctions even for those on mandatory programmes. This then sends a signal to others that they can ignore provision. There also appears to be little follow up from advisers once clients have been referred and the system generally then appears to be laxed.

2.4 Retention Rates in Employment

  It is difficult to comment on this aspect of performance given that there is little follow through once the client is in employment. However, anecdotal evidence from operations managers across the country suggests that clients are often referred back to provision having dropped out of employment. This can often be explained by problems with job quality or by inappropriate referrals by Employment Service. There is also some indication that clients have not been sufficiently prepared for the world of work through the Gateway period.

2.5 Measures of success

  Whilst it is right that the ultimate aim of New Deal must be to gain employment, many of the Tomorrow's People's clients, particularly in areas where there are tight labour markets, are inevitably those with greatest difficulties. The principal success indicator for New Deal has concentrated on crude job entry—other wise known as the "Core Performance Measure A".

  2.6  But for those clients who are a long way from being job-ready, better measures of achievement are needed. For these clients, many of whom will require significant help if they are to gain employment, it is essential that steps are taken to improve employability. This can be both costly and time consuming, yet there is insufficient recognition of the often significant progress that many can achieve, despite that fact that they are not able to gain employment in the first instance. More recognition needs to be given the establishing effective measures of added value, where significant improvements in employability have been achieved.

  2.7  We have learned the lesson well, that it is better to do a good job with 50 than a poor job with 100. New Deal has, of political necessity, been numbers driven. The result being that the Jobcentres have insufficient time to devote to individuals.

  2.8  For those can enter work quite quickly, job retention and advancement are more important indicators of success than simple job entry—after all some 42 per cent of all job starts do not last more than 13 weeks[22].

  2.9  Despite these problems and failures we continue to believe that New Deal offers an excellent opportunity for young people. There are clearly areas where improvements are needed if New deal is to realise its potential. These are highlighted further below.


  3.1  There are a number of factors which have influenced the successes and failures of New Deal.

3.2 Key Success Factors

3.3 Gateway

  Overwhelmingly, Tomorrow's People believe that one of the factors critical to the success of New Deal has been the existence of the Gateway. Whilst it is not without its difficulties, the Gateway period and provision provide an opportunity to deal with many of the problems which clients face and which place barriers to their ability to gain employment. The existence of the Gateway is certainly an improvement on many past government initiatives and one which should be built on and improved (see below).

3.4 Training

  The provision of training is also an advantage, particularly for those on the voluntary sector and environmental task force options. Similar programmes, such as Community Action, could have benefited from training and could have been further enhanced by adding an intensive gateway element at the front end of phase two. Nevertheless, the length of the options is often such that there is insufficient time to complete the relevant qualifications.

3.5 Partnership

  Strong partnerships with the Employment Service and employers are an important ingredient in the success of New Deal. Whilst the strength of the partnership arrangements with Employment Service vary considerably, it is our experience that where there are good relationships there is greater scope for experimentation and flexibility of response to local needs. This in turn leads to improved performance. Partnerships with employers also take time and effort to develop. New Deal has certainly encouraged a greater range of employers to get involved in recruiting the unemployed. However, we have sometimes been disappointed that the Employment Service has been reluctant to encourage employers to use our services as an intermediary, promising that they could deliver just as well, and then did not. In one case, this actually damaged our relationship with an existing customer of Tomorrow's People. However, some Employment Service Districts are very supportive and will do all in their power to help. Others still seem to view us as a competitor and therefore a threat.

3.6 Personal Advice

  The principle of Personal Advisers, who can give personal support to clients, is a further positive aspect of the New Deal. Where they work well, the presence of Personal Advisers, clearly enhances the experience of the New Deal clients, ensuring that the barriers which impede their employability are tackled and that they make the most effective choices. However, we do have a number of concerns about the variable quality of Personal Advisers and the "independence" of the advice that they are able to provide (see below).

3.7 Holistic approach to advice

  Tomorrow's People has had added debt management to many of its projects as we have found that dealing with the "whole" problem of debt and unemployment is more effective than concentrating on one problem and hoping the other might be solved in the process. A linked attack on the debt and job hunting, shows the individual that work and finances are inextricably linked. Personal budgeting is another aspect of this work and ensures that, once in work, the clients are able to manage their resources effectively, improving the chances of retention.

3.8  In work mentoring.

  Getting a person to the point of starting work is one thing. Getting them to stay is another. Providing effective in work mentoring support to the client and acting as mediator between employer and employee when necessary is a powerful key to success. Here the independence of the adviser in this is vital. Any suggestion that there may be a report back to those who control the benefits damages the honesty of the relationship, and therefore the ability to get a good result.

3.9  Key Problems

3.10  Gateway

  Whilst we believe that the existence of the Gateway is a positive feature of New Deal, we also believe that in a number of areas it has not been effectively utilised. More opportunities could be made available to clients during the Gateway period to improve employability, confidence and motivation. We have been particularly pleased by the successes of mentoring initiatives in improving confidence and motivation of clients.

3.11  Length of Options

  For some clients who face greatest difficulties, a longer period on the options would be helpful, particularly where it is necessary in order to complete qualifications, which may enhance their longer term employability.

3.12  Bureaucracy

  New Deal is too bureaucratic. This causes problems both for New Deal contractors and for employers. In addition to the excessive form filling, which is resource intensive, many employers are unused to dealing with large bureaucracies such as the Employment Service and can become frustrated by lack of progress and perceived inflexibility. Many employers have welcomed the role of Tomorrow's People, acting as an intermediary between the employer and the Employment Service, dealing with administrative issues on their behalf.

3.13  Variable Quality of Personal Advisers

  Whilst there are undoubtedly many good quality and committed New Deal Personal Advisers, we are also aware that too many Personal Advisers lack the skills and commitment required to work with unemployed people. Problems include, insufficient contact with clients, with some clients having virtually no contact with their Personal Advisers. This in turn has lead to poor referrals, with candidates being inappropriately referred to options or jobs. We believe that the issues extend beyond training and in some cases is a result of the cultural issues which exist within some Employment Service districts.

3.12  Lack of Independence of Personal Advice

  Tomorrow's People have found that better results are achieved by using an independent adviser who has no power over an individual's benefits. A greater level of honesty is achieved, resulting in a better match to vacancies and ultimately to retention in employment.

3.14  Lack of Flexibility

  Certainly, in the early days, Tomorrow's People was often frustrated by the rules. If we came across a client who had not completed their gateway period, we were being blocked from moving them into subsidised employment. Whilst it is clearly necessary to have rules which determine eligibility etc, greater thought needs to be given to how those rules are written to allow a flexible approach. Unemployed people have a variety of needs and face a variety of different and often difficult circumstances. Flexibility needs to be applied if these range of individual needs are to be met. Many Employment Service districts are loathed to apply flexibilities which are available in other areas.


  4.1  Our experience of working with Employers indicates that they often need support if they are going to engage effectively with New Deal. Yet their support is essential if New Deal is to be effective. Tomorrow's People has had a great deal of success in working with employers through our Corporate Workroute initiative. Through this initiative we are able to provide support to employers and help them to engage with initiative such as New Deal. It is our experience that even the largest and most committed employers need support in engaging with New Deal clients and dealing with the bureaucracy that is associated with New Deal.

  4.2  Set out below are some issues which have been raised by employers and which impact on the effectiveness of New Deal.

4.3  Educating employers

  Tomorrow's People have examples of employers where costly resources were thrown at the job without forethought and planning. Staff within the employer often failed to understand the client group, did not know how to present opportunities to the client group in a way that would encourage applications and were unclear on the issues facing the organisation in terms of retention. On the other hand, other employers have taken the time to research the client group and have changed their recruitment practices to allow groups of New Deal clients to start together, thus building peer group support.

  4.4  Unipart, AstraZeneca and Burger King used Tomorrow's People as an intermediary to handle New Deal in partnership with them, thus buying in the expertise rather than trying to develop their own. This approach reduced the risk of moving into unknown territory and improved the chances of success.

4.5  Relationships between Employment Service and Employers

  It is clear from our experience that the Employment Service needs to consider how they build relationships with employers. One significant London based employer had developed an excellent relationship with their local Jobcentre. A single identified individual at the Jobcentre was responsible for managing the employer liaison. She spent a great deal of time with the employer and helped them through any difficult patches.

  4.6  Other employers have had less supportive Jobcentres. Sadly, many employers complained that after the original high profile contact from their Jobcentre to "sign them up", they never heard from their Jobcentre again. This relationship was never rebuilt in the majority of cases, resulting in a very disenchanted customer base.

4.7  Knowledge of employers

  Spending time to learn about an employer, rather than simply taking their vacancy over the telephone, allows the advisers to represent vacancies more realistically. Again, this leads to a better fit in submissions to vacancies.


  Tomorrow's People is aware that the Employment Service has a programme of evaluation. Much of this evaluation is quantitative and we believe that more information is needed on some of the more qualitative issues which impact on the performance of New Deal. The New Deal Task Force has undertaken a number of projects which have looked at some of these more qualitative aspects. Indeed Tomorrow's People have featured in some of these studies. We believe that a number of lessons have been learned through the operation of New Deal and some improvements have been made as a result. There is still further scope to learn from and extend good practice where it exists. Contractors such as Tomorrow's People have much experience to lend to such reviews and we believe that contractors need to be more fully engaged in such reviews.


  Tomorrow's People believes that there are many positive features of New Deal for Young People and is fully committed to its supporting its continued success. In this evidence we have tried to highlight those areas where we believe there continues to be scope for improvement. As an intermediary organisation we are convinced that strategies for engaging employers need to be further encouraged whilst at the same time supporting the most vulnerable client group. This will be key to the success of New Deal. Ways need to be found to engage Employment Service in supporting organisations such as Tomorrow's People to develop and deliver these strategies.

Tomorrow's People

November 2000

22   Unemployment Unit, Working Brief Commentary 114, May 2000 Back

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