Select Committee on Work and Pensions Minutes of Evidence

Examination of Witnesses (Questions 320 - 339)



  320. It is dramatically so. For example, my constituency which is just on the border of the ten per cent highest unemployment areas in the country, has one of the lowest take-ups of the Working Families Tax Credit in the country and that is a pattern which is very clearly represented across the rest of the country. I am not trying to bounce a question on you, but it would be very helpful to have a clearer steer from within Government to address that imbalance. We are putting excellent programmes in place but if those excellent programmes are not in areas of high levels of deprivation and unemployment to meet the needs as well as they might, then this is something we really urgently need to address.
  (Mr Brown) Making work pay is absolutely crucial to the programmes we are running from the Department and the Working Families Tax Credit is a very important part of that.
  (Mr Richardson) Lone parents are easily the most significant group who could theoretically take advantage more of Working Families Tax Credit. In addition to the outreach activity for ethnic minorities, last month we launched outreach activity for lone parents across the country. Our strategy generally is to address the issues you raised, to deliver mainstream services through Jobcentre Plus in an ever more effective and comprehensive way, but also to reinforce them by more targeted specific activity which Nick has described in areas which suffer from the problems you describe. Hence the ethnic minority outreach, lone parent outreach, the action teams for jobs as well as working closely with local initiatives.

  321. The reason we do not have WFTC take-up is because we have a higher proportion of lone parents and the lone parents are less likely to have informal family support, therefore they are more likely to rely upon paid childcare and childcare is ridiculously expensive. You have an absolutely classic joined-up problem and I am not convinced that the joined-up solutions, whilst they are there as programmes, are there with the resource and intensity to match the needs.
  (Mr Brown) I have to confess that the take-up point in London is new to me and I will have a look at that myself. It may need something simple like a take-up campaign or making sure it is properly explained if there is an issue there with lone parents, which is a possible explanation, then I will make sure we have a hard look at that as well.

Mrs Humble

  322. May I ask you to expand a little more on the answers you have just given on the specific work you are doing with the groups of people who present the most challenges to you? You have mentioned ethnic minorities and lone parents. What about older workers, people with disabilities, other groups like that? Do you have similar new initiatives to help those people accelerate the rate at which they get back into the job market?
  (Mr Brown) Yes, the New Deal for 50 Plus is focussed on older workers or potential workers. There is a New Deal for the Disabled which is focussed on people with disabilities and is entirely voluntary so they are reliant on people coming forward and asking for it, though we do try to make sure it is well known by potential applicants. There is a New Deal which is focussed on ex-offenders and we are trying to work with the Prison Service so that we can discuss employment prospects for an ex-offender with them even before they leave custody if they are in custody. Having been in custody is a barrier in the labour market. And there is a New Deal focussed on recovering people, people who have had problems with drugs, illegal drugs rather than alcohol. These are the hardest to help. Some of these New Deals are very new New Deals so we are at quite an early stage. It is too early to start presenting evidence and saying what we have learned, but it is this proactive approach to those who are finding the labour market most difficult which is new and right. Just to emphasise the point, the Government would not want to be knocked off course in what we are seeking to do were the labour market to loosen.

  323. You pre-empted my question about monitoring the success of all these various New Deals. It is important that people do know about them and that they are effective in targeting those specific groups who do need the most help. May I follow up specifically on people with disabilities? In an earlier evidence session we were told about the importance of Jobcentre Plus working in partnership and we have had some further information this morning about the recognition of the importance of partnerships and local strategic partnerships. Are you also working closely with the voluntary sector and ensuring that those who are out there in the voluntary sector, who are working with each of these more challenging groups are fully involved in meaningful partnership with Jobcentre Plus?
  (Mr Brown) Yes, is the obvious answer. Am I going to sit here and say no?

  324. I guessed that one.
  (Mr Brown) That is most certainly the intention. I make every effort myself, and the other Ministers in the Department do as well, to make sure we are meeting the key groups, both voluntary groups and the other organisations which are delivering our programmes. Relationships are pretty good at ministerial level; no doubt on the ground it does not always seem that way.
  (Mr Lewis) It would be a brave person who would sit here and say every single relationship out there with every single organisation, national and local, is perfect and could not be improved and I would not say that. What I would say is that there is a real intent to work with partners at national and at local level because we need their expertise and knowledge if we are to achieve the objectives set for us by Ministers and Government. Secondly, we cannot possibly do all of this ourselves. People have a huge amount to contribute. At national level we have good strong relationships with, for example, organisations like the Disability Alliance, Mencap, etcetera. We have set as one of our values for the new organisation partnership, reaching out, working with organisations. At a local level we seek to establish very strong working relationships both with organisations which represent the interest of particular groups of people who face barriers to employment and also with organisations who are providers through programmes like the New Deal for Disabled People to try to ensure that while they are our providers and of course while we will be expecting them to meet certain output targets, certain quality thresholds, nevertheless we work with them in a spirit of partnership to seek to enable them to do so.

  325. Are you also listening to them when they point out what they see as failings in the system or areas which could be improved?
  (Mr Lewis) Yes, I think we are. Whether they always believe that we listen to them enough and react sufficiently and quickly enough is obviously for them to say. I think we are listening and there are lots of examples where we have changed what we do both at a national level, for example in the New Deal for Disabled People introducing an element of a funding advance to meet some of the difficulties which the programme has experienced in its early days and on a local level to meet particular difficulties and concerns. I would not want to sit here and say there is no possible issue anywhere which has not been brought to our attention which we have not perfectly addressed. What is very important in this is trying to establish a culture within Jobcentre Plus which says two things: do we want to listen? Most certainly we do. Do we want wherever we can to respond to real practical issues? Yes, most certainly we do.

  326. To change the focus slightly, we had earlier evidence about the difficulty of people's perceptions. If somebody has done a job for a very long time, they then cannot imagine themselves doing any other job, or everybody in the street did the same job, they all worked for a large employer. How can you overcome people's perceptions about their own abilities—a lot of people have abilities which are there untapped—and that they can move out of a particular area of work or expertise which they and their family and friends have had knowledge of? How can you overcome that?
  (Mr Brown) That is exactly where the personal adviser comes in, why it is important to sit down with the individual to talk about their job opportunities which are there in the labour market, to make sure they understand how their real income is affected by the sort of wages which are being paid and other tax credits affect what their take-home pay would be, in other words how they are going to sit economically, then to talk about whether they could actually do these jobs or could train to do these jobs or would want to do these jobs. To leave people to find these things out for themselves is insufficient. We think it is the role of the personal adviser to sit down with them, to talk them through how things are. It is a shock if a community has had one single major employer which people have traditionally looked to as the place where one would go to work, where all their friends and neighbours worked. When those jobs go it has a traumatic effect on a community; I know because I represent such a community. Yet we have to face up to change and it is the responsibility of the state to help people through. What we do know is that the jobs are out there. There are jobs available but often not in the same industry and also not requiring the same pattern of work and skills set. That means we have to face up to change and the state has to stand in the citizen's corner and help them through that period of change.

  327. It is also sometimes simply that people have very low aspirations and do not aim high enough.
  (Mr Brown) That is all true as well.
  (Mr Lewis) I know the Committee have been to our new offices and thank you for doing that. One illustration of that, as you may have seen, is one of our posters on the wall which just has three words on it, "Yes You Can". Part of our job as an organisation is to say to people who are saying "I couldn't ever manage that. I couldn't do that. I wouldn't know how to begin", "Yes, you can. With our help, with our support, yes, you can". It is about helping people to recover and restoring their confidence.

  328. Minority ethnic communities. We have had some evidence about the problems faced specifically by minority ethnic communities in setting up in business. We understand that there are some research projects looking at this. Are you evaluating those research projects? Are you looking specifically at how you can support minority ethnic groups in setting up businesses that will then employ people within their own areas?
  (Mr Brown) Is this about self-employment?

  329. Much of the evidence was about self-employment and that many people wanted to access self-employment as a route into work rather than into employment. Are you looking at that as a specific area and offering whatever help you can?
  (Mr Brown) I know we have our own programmes if people wish to be self-employed and it is actually quite an interesting area all of its own. Do we have anything specific for ethnic minorities?
  (Mr Lewis) Just to be entirely straightforward on that, I do not think I have seen the piece of research you refer to specifically, so if you can point me in its direction I shall have a look at it. We are very much focussed on the needs of ethnic minorities, both within our New Deal programmes and more widely. It is an absolutely major focus of our policy and we are wanting to support our customers more generally, those who want to make a transition to self-employment. I have not seen this specific piece of research.

  330. I understand there are some research projects but whether they are in general terms or about self-employment I am not entirely sure. There is a Small Business Service/Bank of England project in the Performance and Innovation Unit. There may be some information there for you to have a look at.
  (Mr Brown) We will check that out and perhaps come back to the Committee. I am not familiar with the work.

Miss Begg

  331. I want to explore the relationships between the Jobcentre Plus and the voluntary sector a bit more, particularly with regard to New Deal for Disabled People. Whilst I accept there are probably good relationships with the voluntary sector organisations for the disabled helping towards being a provider, in order for a disabled person to get that far they have to come through your personal adviser in the Jobcentre Plus. I am not convinced that the personal advisers in the Jobcentre Plus who are working with disabled people are sufficiently trained or sensitive to the needs of the disabled or in fact robust enough. In fact if anything they are too sensitive; their sensitivity is overly sensitive. They are frightened to suggest to disabled people "Yes, you can", because they do not have experience themselves directly of disability and are sometimes too tentative in their suggestions. That is what I have seen from my own experience in visiting local Jobcentre Plus and speaking to the personal advisers. I should like to see, and I wonder whether it is a suggestion you could take up, the voluntary sector, the organisations for the disabled, the organisations who already work with disabled people, in the Jobcentre Plus, helping, sitting alongside the personal adviser, or indeed acting as personal advisers. That is perhaps one of the areas you could hive off to a different organisation rather than using your own staff, so you do have people who understand the needs of disabled people and who are going to work in a much more proactive way with disabled people to get them into jobs.
  (Mr Lewis) If I may say so, the point you made in your question about our people being sometimes slightly fearful of tackling issues is right. I agree with you that there is a major need to ensure that we do have people with the skills to help people with disabilities professionally. As well as our personal advisers, we have a group of specialist staff, disability employment advisers, and they are locally based also and they are there to give professional advice and support to more generalist personal advisers. One thing we have done with the advent of Jobcentre Plus is to change from separately managed centres down the discrete management line to centres under the direct management of the District Managers. We want to integrate that into our mainstream precisely to ensure that they do have their knowledge and expertise being brought to bear more widely. I do not rule out at all the kinds of innovation you are suggesting and I shall willingly look at that. Probably we will find in some places we have got quite close, if not quite, to what you are suggesting, but to arrangements in which voluntary groups working with particular groups of disabled people are very much embedded into our delivery structure. I would positively welcome such developments. I am happy to go away and look at that proposition.

James Purnell

  332. I want to ask some questions about the New Deal options and New Deals in general. We had quite a lot of evidence, indeed a consensus, that the five options were too inflexible and that organisations would like to see a mixture of those option packages designed around the individual. That is something which was reinforced in our trip to the United States last week where pretty much all the programmes we visited combined an element of education, an element of personal advice, voluntary work, placement in work. Could you say whether that is a direction in which you are thinking of going, whether that is one of the areas in which you aim to make the New Deal for Young People more flexible?
  (Mr Brown) We are very outcome focussed. The purpose of our programmes is to get people into the labour market and if we can into unsupported and sustainable work so they can earn wages and live their own lives. It does not matter how generous the benefit system is, it is always going to be the best way forward. That is the focus. There is no advice in front of me to reconfigure the existing New Deals. There is no ideological opposition to doing things in a different way.
  (Mr Lewis) On New Deal we have been on a journey which is a journey where we have been trying all the way to learn from the experience of how it has been working to make the programme more flexible. We have introduced changes as a result of the Government's Green Paper. One example which picks up the heart of your question is an initiative which we are calling Tailored Pathways, which we are currently piloting in 17 areas, which is precisely piloting a more flexible approach to the option period after the gateway. That is enabling personal advisers to tailor a package of provisions more specifically to each individual which may be of the nature you are proposing. More radically and more widely and successfully, one of the things which, if one is allowed to take pride in something, I am particularly proud we have introduced and which seems to be working well, is the Adviser Discretion Fund which is now nationwide for people once they have been out of work for a particular length of time. This enables our personal advisers to use up to £300 for any purpose, as long as it is a proper purpose, which in their individual judgment will help that individual meet some of the barriers between him or her getting into and sustaining jobs. At the last count, we have now had 125,000 examples of that fund being used. It is very, very popular with our advisers, precisely because it enables them to respond immediately and very swiftly to the actual individual circumstances of the person they are seeking to help.
  (Mr Brown) The average spend is something like £70.
  (Mr Lewis) Yes, the average spend is just over £70, which is very interesting because one of the worries if you give people discretion is whether they will deal with it properly, whether they will abuse it, whether they will each spend £299.99. Give people discretion and overwhelmingly they use it sensibly.

  333. That is something I greatly welcome. My Jobcentre Plus have been using that and they can have a higher spend if it is authorised, can they not? That is something we welcome in terms of greater flexibility. Another suggestion which was made to us along that vein by the Work Foundation was whether the individual adviser should be able to suspend the 16-hour rule in terms of learning for particular clients. I do not know whether that is something you are looking at or a suggestion you could take up.
  (Mr Brown) It is not without its down side.
  (Mr Richardson) We look at it all the time. The terms on which people draw Jobseeker's Allowance is that they must be actively seeking work. It is possible to combine some element of learning with actively seeking work, but if it is a condition of the benefit that you should be available for work and go to work as soon as something can be found for you, then it seems to us that should be the overwhelming principle and that we ought to be making other arrangements if we think that people should be benefiting from learning more generally. This is why in New Deal people are taken off Jobseeker's Allowance if they get to the option period and it is decided that the best thing for them is a longer sustained period of learning and put on a Training Allowance. If we were to develop that principle more widely, that is the route down which we would want to go.

  334. Another thing we have been struck by, both in the Netherlands and the United States, is the effect of intensive work on soft skills and on life skills with people who have been unsuccessful in getting back into the labour market and very long-term unemployment and the hardest to reach. You mentioned a number of programmes in your evidence, Step-Up, the Intensive Activity Period. Do you want to say something about what the Government are planning to do in that area?
  (Mr Richardson) More of the same is the answer. The introduction of the intensive gateway to the New Deal for Young People was very striking. You could see immediately from the outcome figures a sharp increase once it started to cut in on the number of young people moving into jobs from the gateway period in which this period had been introduced. We are now going to pilot it as a mandatory element in the New Deal for 25 Plus to see whether it has the same effect. The Step-Up programme has just started as a pilot for people who have been through New Deal without getting employment and we shall see whether that works. What you imply is right. There is scope for more of this type of activity for people who are finding it hard to get into the job market because of their own personal motivation or whatever. We shall seek to do more of what appears to be a recipe for success.

  335. What we found in the Netherlands was the strong focus on what they call re-integration and going into people's homes, getting them to start doing the washing up, start thinking about their lives in a total way, addressing drug and alcohol problems. Is that the kind of direction which Step-Up is going in?
  (Mr Richardson) Not Step-Up so much. We have other programmes called Progress to Work which at the moment are restricted to working with drug addicts, but we are extending them on a pilot basis in the autumn to other hard-to-help groups which will involve that kind of activity.
  (Mr Lewis) Because I had read so much about it but not seen it, I did manage to take myself to the Netherlands for a day and visited one of their Centres for Work and Income and talked to the people running it. What struck me was, not that there was nothing we could learn from the Netherlands, on the contrary, there are always things you can learn, but just how much we seem to be travelling in some common directions.

  336. We found that as well. That last answer prompts me to ask a more general question. Why do we have all these different New Deals? In terms of even trying to follow the programme, every time we discuss this and go to questions a new one comes up. Why are there so many individual initiatives rather than having one overall New Deal programme?
  (Mr Brown) There may be a case for drawing some themes together. The truth is that the problems we are trying to tackle are different. The problems of a lone parent, for example, will be very different from those of a recovering or recovered drug addict or an ex-offender. We have tried to tailor the schemes to the specific client groups, the more so as we have focussed on groups of people who find the labour market the most intractable rather than on the generality of the population for whom we think the mainstream services we offer are the right ones.
  (Mr Richardson) There is a big divide between those who are subject to mandatory work search conditionality, who are on Jobseeker's Allowance and on other benefits. However much you want to try to streamline New Deals, there is a fundamental difference in the way you need to handle people who are on JSA and other deals. I personally think there is quite a lot of scope for streamlining and homogenising in terms of eligibility rules and one or two other things like that, provided you keep this divide. There will be some advice reaching the Minister's desk very soon on what we can do. We want above all to be able to make this intelligible to employers. Employers get terribly muddled and in some cases fed up with different forms with different requirements depending on what New Deal you can get. It is worth remembering both the hectic pace at which we implemented these initiatives and the way, because of financial reasons and capacity constraints, they came in seriatim. It was not practically possible to plan a single basic programme with different bells and whistles from the beginning, so we are having to catch up on ourselves. We are doing that work at the moment and Nick will shortly be able to pronounce on whether he thinks what we are proposing makes sense.

  337. May I ask about the role of the individual adviser? From our visits to Jobcentre Plus and the evidence there, there seems to be some move away from the original intention to have one adviser working with the client all the way through. In the US we were struck by the follow-on period where they had an adviser working with them during the period of training and job placement, but then that person worked with them for another two years afterwards, looking at job progression and whether they stayed in work. Can you tell us whether you are moving away from the concept of one adviser, one person? Or is that still something which is part of the programme?
  (Mr Lewis) We are not moving away from the fundamental principle of one person, one adviser. One of the huge successes of the New Deal, indeed now we are extending it through Jobcentre Plus more widely, is that people have enormously valued having an individual adviser working with them, one person who is their guide, support, mentor through the system. No, we are not moving away from that principle of there being a personal adviser. What we are trying to recognise is that that adviser, no matter how well trained and skilled and experienced, cannot be expected to be expert in every single issue that individual they are seeking to help may ever raise. More than ever we are saying to our personal advisers, that they will need at times to bring in other colleagues, disability employment advisers, organisations, partner organisations with specialist skills in homelessness, drug rehabilitation, etcetera, if that is clearly appropriate and needed for that individual whom you are seeking to assist and help. No, we are not moving away from that fundamental principle of there being a personal adviser. It has been shown to work.

  338. Are you satisfied with the quality of the education being provided in the education option or indeed more generally? Is that something which you have concerns about?
  (Mr Lewis) It would be wrong of me to say yes, I am satisfied that there is no possible scope for improvement. In the early days of the education and training option, there was not a sufficient work focus in some of the provision which was taking place. The outcomes of people in terms of progression into jobs were not in some cases—it is patchy—as strong as we would have wished. There has been a process which has now been going on for some considerable time of working much more closely with our providers to ensure that the training, the education people receive under that option of New Deal is related to their needs as an individual and related to a labour market in which they will be seeking to gain employment. We are making progress but there is further to go.
  (Mr Richardson) We have lost quite a few providers on the way as the result of a much more rigorous approach to the outcomes we expect.

  339. Quite a lot of us in the US were horrified by some of the sanction regimes which were applied in the US, particularly by those requiring single mothers back into work very soon after the birth of their children. On the other hand quite a lot of the organisations we spoke to said that they thought the existence of the sanctions was an important part of changing the culture. What are your views on the balance of sanctions in the system at the moment? Are you thinking of leaving them as they are? Do you think there should be any change?
  (Mr Brown) The system does require a proportionate sanctions regime. As to how it works operationally, Leigh might help.
  (Mr Lewis) We have moved since the early days of New Deal. After a period additional new sanctions came into play with a 16-week sanction for somebody who was persistently not following through the requirements of New Deal. It is interesting when you talk to some of our advisers about this. I find very, very few advisers see sanctions as a weapon which they want to use in a punitive sense: "I want to apply a sanction because I think this individual deserves a sanction to be applied to them". I think I find advisers who increasingly see sanctions as a way of perhaps concentrating the mind of someone who is not seriously addressing the fact that they cannot go on as they are expecting just to follow their particular lifestyle through for ever more, to get them to face up to the fact that they are going to have to make some choices and some decisions. I see advisers using sanctions in a rather sophisticated way, not to apply them but just to make clear they exist and that ultimately they will come into play if that individual is not prepared to face up to the issues. They have in some cases quite an advantage in that sense.
  (Mr Brown) I suppose the underpinning point is that: does a citizen have the right to say, "I can work. I could work. The jobs are there. I am not going to take any job. I just want to live off the state"? Do people have that right? The answer ought to be no.

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