Select Committee on Works and Pensions Minutes of Evidence

Examination of witnesses(Questions 120-139)-



  120. How can you do it and they cannot?
  (Mr Lovell) I do not know.
  (Mr Knight) I do not know
  (Mr Lovell) One point to make is that you asked what percentage of money was tied to innovation and notionally in the contract it is 15 per cent. In terms of what depends on innovation, the entire funding we receive depends on innovating to make sure we deliver the service. That is the point I made earlier. It is lost in trying notionally to allocate a percentage of funding against innovation. It was an admirable attempt, but I do not think it is one that works.

  121. You have generally gone round this particular issue so I shall put the question straight to you. What does the Department need to do if it wants to free up the scope for experimenting and innovation? You have mentioned giving you uncapped contracts and so forth. Is there anything else it needs to do?
  (Mr Lovell) I feel passionately about this one, so I shall give one response. You must remember that in terms of the funding portfolio we received for ONE, the majority of it really relates to staffing costs. We know we could get the same property we are operating from in Rutland at one third of the price charged to Government, because when you come along the Government are paying and landlords hike up the rent. It is an unfortunate consequence and what happens, because we were quoting at the same time. There were estate issues. If you were to take the funding wrap and have an innovative pilot, take it into an environment which you would design specifically for this, rather than re-designing a Jobcentre to do something, I understand what Chris is saying about an open pot and it is not, it is about two-way risk. We enter into contracts like this with the Employment Service as well, where we say there may be a notional cap but it is significantly higher because you over-achieve anticipated performance output. There is a place for that in ONE; but being much more open about the entirety of the budget which is available to an organisation, we could have created significant savings, we could have created a significantly different programme which felt very different and delivered more value for money from what we did — if we had access to other arms of the stream. That was not feasible at the time the project was initiated and I understand that and that is something which can be taken forward with Jobcentre Plus.
  (Mr Granger) Having the same contract management structure across different pilots would be a start. The pilots were managed very differently and we have the evidence of that from the disparities between Leeds and Suffolk. Dealing with the disconnect between local management and central management would also be very helpful. We found ourselves in a situation where some contractual decisions were being taken in London; some were being taken in Sheffield; some were being taken in Leeds; different ones were being taken in Suffolk; local authorities were having different opinions—seven of them in Suffolk—to each other and to ES and BA. Dealing with a unified contractual management structure, which is consistent, will produce consistent results and that is why I believe there are differences in the phenomena you have seen around accessing funding .
  (Mr Melvin) I would agree with all that has been said. I would just reiterate that we need longer contracts which will encourage us to invest. They should not be capped, so if we provide a better level of service with better outcomes, we are rewarded. All I would add is that officials need to be given the freedom to make decisions. The point has been made that it is not really a negotiation when a group of officials come and say "That's what's on the table, take it or leave it".

  122. Did you make as much money out of the contract as you expected to?
  (Mr Melvin) No.
  (Mr Granger) We did not enter into this to make money. We entered into it to prove we could deliver a better service, in the hope of having the opportunity to assist in the implementation of a national scheme.

  Chairman: That is a very interesting answer to a different question.

Mr Dismore

  123. Did you make as much money as you expected to?

  (Mr Granger) We did not expect to make any money out of it and we have not made any money out of it.

  124. Did you expect to make any money out of it and did you make any?
  (Mr Lovell) We did not have a view. I know that sounds an incredibly naive answer but I shall tell you why. When you enter into these contracts you are blind on the funding structure and we are used to entering into those types of contracts with ES in particular. Ultimately, once we had got under the skin of that, we made a reasonable return. We are satisfied with the way it has gone. The point is that you get economies of scale as you get the expertise and experience.

  125. When we visited the Employment Service in Sheffield, they said they would give us a list of innovative projects which they had agreed with you. It subsequently turns out that they are saying the list is labelled "commercial in confidence". Has any of you any objections to us seeing that list?
  (Mr Lovell) No. It is the first I have heard. No.
  (Mr Granger) No.
  (Mr Melvin) No.

  126. You are happy for us to see the list.
  (Mr Melvin) Yes.

Mr Mitchell

  127. Does that mean we can produce it in our evidence so it becomes a public document?

  (Mr Granger) It might be interesting to check the accuracy of it.
  (Mr Lovell) Yes, it might be interesting to check the accuracy.

Mr Dismore

  128. You are happy for us to see this and you would like to see it as well.

  (Mr Lovell) I should like to see it. I have a list here of our innovations.


  129. Did you just say you would be interested in seeing it?

  (Mr Lovell) Yes

Mr Dismore

  130. Have you not seen it either?

  (Mr Lovell) I would imagine it probably cross-references against the things we have been paid for out of the innovation pot, but that would not be a complete list of innovations.


  131. You must have all seen your own innovation lists.

  (Mr Granger) Yes.
  (Mr Lovell) Yes.

  132. But you have not seen each other's.
  (Mr Granger) No.
  (Mr Lovell) No.
  (Mr Melvin) No.

Mr Dismore

  133. Do you want to see each other's?

  (Mr Lovell) There's an interesting question I had not anticipated.
  (Mr Melvin) May I just make the point that in terms of innovation, if you are going to publish a list, what is in that list from the Employment Service is unlikely to be the true scope? What we delivered in terms of innovation is not simply that which has been paid for from the innovation pot, but several things from the core funding, which we have added to the service, which we would claim were innovative.


  134. I am still a little confused about this. You all know what your innovation is. If you send us a list and then you release the ES from any question of confidentiality we shall all be able to see what the innovation is and that is in everyone's interests. Are we all agreed?

  (Mr Melvin) We are.
  (Mr Lovell) No problem.
  (Mr Granger) Yes.

Mr Dismore

  135. If we publish what we get from the Department, if we get something from the Department, you can put in a supplementary paper yourselves.

  (Mr Melvin) Yes.


  136. We are not trying to be clever here. We are just simple seekers after the truth.

  (Mr Melvin) The point I would make is that people like Mark and myself communicate fairly regularly. We pretty much know what we are each doing. We do not have a problem with this "commercial in confidence" thing because we are in a business where our prime motivator is to help unemployed people or people on other benefits.

  Chairman: It is what we would rather have expected adult people to do, but we were told it was confidential and we thought maybe that was your fault. It clearly is not and that is what we needed to know.

Mrs Humble

  137. I want to return to basics and examine the ONE vision. It is a very, very exciting vision with staff working in a holistic way, with an individual following them through, advising everybody, not just the unemployed, to overcome the barriers which prevent them working. What I should like from you is just how easy it has been in practice to achieve that vision. I shall start with Christopher Melvin. In your introduction to the Chairman's questions at the beginning you did say how much you welcomed the concept of a one-stop-shop. How easy have you found it in practice to deliver that vision?

  (Mr Melvin) For a number of clients in North Notts we have been able to do it, but sadly that is probably not the majority. The first thing to recognise is that for those people who are on benefits other than Jobseekers Allowance their engagement after the work-focused interview is voluntary and therefore it is our responsibility to encourage them to engage as much as possible. I would add that the majority of the funding is based on front end of the service, the start-up interview, the work-focused interview, and there is very little funding for ongoing case loading. That is where we have put some of our innovation money and achieved good results. If you compare it with Jobcentre Plus, where you have what I would argue is a more holistic service in that people will have opportunities to join things like New Deal for Lone Parents and there might be an opportunity for people on the appropriate benefit when they come in to see a lone parent adviser initially. With Jobcentre Plus the whole service is going to be delivered from one side. With ONE you have pretty much had the front end of it. Because of estates issues in our own experience, where we are not in some of the sites—we operate from five sites—co-located with the Employment Service, then we have a greater obligation to try to encourage people to come back because they are probably more used to going into a Jobcentre-type environment which is a national organisation which has a high degree of recognition of helping people on benefits back into work. We have managed to achieve it, but it has been hard work. If Jobcentre Plus is implemented in the way it seems to be, it should find it easier.
  (Mr Granger) We think overall that the pilots we have been operating have been successful in terms of a step change, a radical improvement in the service that the public receive and also job satisfaction for the staff working in them. Estates are a key part of that and if you visit the premises which Leeds City Council made available for the pilot in Leeds, in Great George Street, you get one experience. If you visit Woodbridge in Suffolk, you would see something very, very different. In terms of connectivity around the service, there are always going to be boundary problems because, especially with the non-JSA population, their challenges are more complex; they need more time and they need more specialist advice. The challenge for Jobcentre Plus is going to be deciding where to draw the boundary to serve the majority extremely well and there will be a disconnect with serving people who need specialist services beyond that majority.
  (Mr Lovell) I agree with you. I think it is exciting. I think it is different. I do not think that has changed. In terms of implementing all of those things, we have found it not easy and not difficult; in the middle. We made sure that every member of the team—and it is sustaining this that is the difficult bit, particularly because you are delivering it in the middle of a Jobcentre where you are surrounded by a different culture. The passion, the energy, the determination, the commitment, the flexibility, exist there. I still enjoy very much going to meet the people who deliver our ONE service, because they fill me with that energy again. When I forget we are here to service a client then they remind me. We have found all the things you are talking about in delivering our service and we are still passionate about the generalist approach. That can work. I see elements of Jobcentre Plus where people are beginning to segregate out specialisms, and I do not think that is the right approach. I agree with you that the concept is a strong one and its application can work. You need the support of the other agencies you are working with to do it and Richard has made a very pertinent point that there are different approaches in different areas and that will be so in the national roll-out of Jobcentre Plus. We have found it as we expected. It is tough, it is challenging, but it is fun.

  138. Nice to know it is fun working for the Government in this way. May I explore a little further the tension which you have also all outlined between work focus and benefits? Richard, in answer to an earlier question, you mentioned that one of the frustrations for staff working in the Leeds office was having to concentrate on benefits. You said if somebody had been laid off on the Friday, they turned up on the Monday, a lot of time was spent dealing with benefits which was the immediate concern and it might be a week later before they returned for the work-focused interview. By that time presumably they may have found work themselves, but that was in what you described as being a jobs market which was buoyant. What are each of you finding in the areas you are working in and how are you coping with that tension between benefits and work and is there any way that tension can be overcome?
  (Mr Granger) You will have seen the submission I made to Tessa Jowell last summer on this topic. It is our opinion that it would add a lot to the service to be freed up from having a-one-size-fits-all process and being able to stream people according to their work readiness and benefit needs. Frankly the other side of the coin is also true. There are people who turn up on a Monday morning with a benefit need who are not at that time employable. It is not good use of anybody's time to have a conversation with them about employment. It is good use of time to make sure there is the highest degree of accuracy with their benefit application and agree with them a personal contract around the timetable to have a conversation when their personal barriers change through training or the passage of time. We strongly recommend that treating people as individuals rather than people who go through a standardised process will produce a better outcome.

  139. Would you then also be relying upon the judgement of the personal adviser who saw them at that initial interview?
  (Mr Granger) I believe that civil servants working in front-line public service have very good judgement about these things.

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