Examination of Witnesses (Questions 100-119)
WEDNESDAY 12 FEBRUARY 2003
MR IAN
CHARLESWORTH, MS
JOANNE HINDLE,
MR DAVID
NICHOLL AND
MR AUSTIN
HARDIE
Mr Goodman
100. I am going to ask some questions about
the New Deal for Disabled People. Mr Charlesworth, this is perhaps
a redundant question to ask you, given that in your evidence you
say that NDDP is a low profile, under-resourced arm of the Government's
Welfare to Work agenda. Can I just go down the line and ask you
in turn, do you think the NDDP has been a success so far?
(Mr Charlesworth) It has been a success so far as
the clients we have helped into work are concerned. It is very
cost effective from a state point of view. It is very effective
from an individual client point of view. Where you have got a
good job broker, and there are good job brokers from the private,
the voluntary and the public sector, it works well. However, you
have had a contracting process which has allowed a lot of organisations
who should not have been involved to become involved and give
it a bad name.
(Ms Hindle) A one-word answer really: patchy. Where
it has been good it has been great and where it has been bad it
has achieved very little for anyone.
(Mr Nicholl) I think "patchy" is absolutely
correct. Nationally it is not good. There are beacons of good
results. Very often where these exist they exist where the New
Deal for Disabled People provisions are integrated into other
mechanisms to help move people back into work.
(Mr Hardie) I can only echo that. It has started slowly;
it is building in some strength. There is an awful lot more it
could do.
101. How could the NDDP change to reach the
people who are furthest from the labour market? Is it just a matter
of putting your money in or is there rather more to it than that?
(Mr Charlesworth) There is more to it than that. First
of all, you change your contracting strategy, get people in working
partnership with others who know what they are doing. Secondly,
you change your contact strategy to allow much more direct communication
between your job broker and the individual client using the benefits
system, as has happened on the employment zones and the ONE pilots
and so on, which would help reach more people. More money is needed
for the marketing side as well. You will find in our response
half a million pounds for marketing nationally for NDDP. The tax
credit adverts that have been on television recently had a budget
of £10 million, and there is half a million for the whole
of NDDP. That is another direct way. At least 30% of the current
cost is being wasted by us chasing evidence that the person has
moved into work, has sustained the job, often to the detriment
of the client, because we have to chase people who are in second
and third jobs and do not want the employer to know that they
have come off IB in the past, when it could be done by pushing
a button using the tax, insurance and benefits information that
they now have access to. With the new regulations that went through
they can access tax at Jobcentre Plus, but instead 30% of our
time is spent running round employers and individuals to get that
evidence. There are all sorts of practical ways in which the scheme
can be improved, not least of which is that you need to have those
local partnerships and local links and that should be encouraged
in the way that it was under the old system in the personal advisor
pilots. None of the lessons of the personal advisor pilots about
contact, about contracting, was learned.
The Committee was suspended from 3.59 pm
to 4.21 pm for divisions in the House
Chairman: We were in the middle of an answer
by Mr Charlesworth to a question from Mr Goodman.
Mr Goodman
102. We were talking about reaching the people
who were furthest from the labour market and whether it was just
a matter of money.
(Ms Hindle) My short answer to whether the NDDP can
be improved sounds perverse but it is much the same point: slow
down. Stop piloting things, stop trying out new things, look at
what is working, analyse it thoroughly and spread the good practice
elsewhere. It may take ostensibly a bit longer, but I suspect
that in fact the results will come through much quicker. I think
over time that is what will have the biggest effect. It is self-evident,
is it not? Find what works and replicate it.
103. You feel strongly, clearly, that this proliferation
of pilots, of experimentation, is having perversely counter-effective
results in that people are so busy experimenting and trying things
that they have got no room to settle down and find out what the
end result will be.
(Ms Hindle) Yes, exactly the point Mr Charlesworth
made, keeping records and chasing up and filling in the forms
and seeing what has worked. Before ever we got the final analysis
of the ONE pilots Jobcentre Plus was launched. It may or may not
have been the right thing to do, but what was the point of spending
money doing pilots if you were not going to wait and see what
the results were and then move forward? I know that sounds as
if I am meaning everything will go slower. I think in practice
it will not. I think the results for people will come through
a lot quicker because we are concentrating on spending the money
and the time on the good stuff rather than keep on piloting or
indeed rolling out stuff which was not working but we did not
know that before we rolled it out.
104. Mr Nicholl, do you dissent from that?
(Mr Nicholl) Not entirely. I would add though that
it would certainly be a welcome move if the financial structure
of New Deal for Disabled People was slightly different. Too much
of the payment structure works on outputs. I think there is a
danger that that could encourage organisations to cherry-pick,
to take those nearest the labour market and work with those because
that is where the financial rewards come in. It is important to
get greater local flexibility because clearly the numbers of people
on Incapacity Benefit are not uniform throughout the country and
I think Jobcentre Plus, for instance, may have greater flexibility
locally to administer schemes in their area and adapt them to
their circumstances. Finally, the thing that I think is critically
important is that there has to be a change in the way that the
regulations are administered for people who are on Incapacity
Benefit. Essentially, if you are on Incapacity Benefit you are
certifying that you are not able to work. Therefore, by participating
in work experience or training, you are saying that you are fit
to work and your benefits stop at that point. I think if people
were allowed to keep their benefits during a training and work
experience period that would encourage people into training and
work experience, a good number of them would get permanent work
after that, and it would effectively be budget neutral because
they are going to get the money anyway. You could use the existing
budget sources much more effectively with some minor changes in
the regulations.
(Mr Hardie) One minor point is that, along with flexibility
at a local level, there is a degree of accountability that needs
to be looked at. NDDP is essentially a centrally managed national
programme and I think that devolution of some of those targets
and outcomes to local Jobcentre Plus levels at regional and city
level would certainly be helpful in engaging local Jobcentre Plus
staff to help push the case of NDDP. Somewhere along the line
to date that has been missed out because it is perceived as a
centrally managed programme.
(Mr Charlesworth) I have given the paper to the Clerk
on what would make NDDP better. Can I add something else that
is troubling me a little bit? You did talk about the public record
and the 2.7 million. There are actually 3.651 million disabled
people who are economically inactive and that is the important
number as far as I am concerned. Incapacity Benefit is just one
benefit that somebody might be on. There are 3.65 million disabled
people of working age who are economically inactive and that is
the group that we would ask you to concentrate on, not just the
IB claimants.
105. Could I start the next question by asking
Mr Nicholl and Mr Hardie about it because it relates to something
in your evidence? In your evidence you talk about intermediate
labour market programmes and how helpful they are in making the
transition to full time work, but you also point to a problem,
which is a reluctance by some people with disabilities to engage
in those programmes. How do you think you could solve the problem,
being that you have these programmes that are extremely useful?
(Mr Nicholl) I think it requires a pragmatic rather
than a legalistic solution and action on the part of the department.
That is about changing the regulation and differentiating work
experience programmes and training from work. The catch-22 situation
that many people are in is that they do not want to jeopardise
their benefit for the insecurity of the open labour market, particularly
at entry level jobs where it is very insecure, but they may not
have up to date work skills. Sometimes the only way to acquire
those up to date work skills is to participate in either a training
or a work experience programme like an intermediate labour market.
That is just one of many solutions but it is the one that we are
particularly interested in. If the department could make an exception
around there I think many people would see that as a safety net
that would allow them to test their likelihood of gaining permanent
employment.
(Mr Hardie) Essentially it is the psychology of moving
back to work. A short series of measured steps that progressively
move people back to work using intermediate labour markets and
related programmes would certainly work to increase the confidence
of many sick and disabled people on Incapacity Benefit rather
than this, "I am going to risk my relative economic security
on benefits at the roll of the labour market dice". Many
people would not go for that. It is the psychology of this transition
and I think it is giving people security that this transition
is about: moving them in manageable chunks towards inclusion in
the labour market rather than rolling a dice and seeing what happens
in an entry level job that may or may not last very long.
Miss Begg
106. From what you have said this afternoon,
Mr Charlesworth, I get the impression that you are not particularly
enamoured of the service provided by Jobcentre Plus. Is that a
fair criticism?
(Mr Charlesworth) I would not say that. I believe
that the DEAs are very professional and very committed bunch of
individuals who are doing a good job in difficult circumstances.
I do not think the disability service within Jobcentre Plus has
been properly supported within the management structure of Jobcentre
Plus. That would be my criticism, not of the people on the ground.
Similarly, where Jobcentre Plus is a provider of services, such
as in job broking, they are a good provider. What my criticism
would be is, as I have already said, is that they take the service
out in the same way as we do and form the same kinds of local
partnerships. It seems that it is at the policy and strategic
level, and whether it is political with a small "p"
or not, they want to see the Jobcentre and the Jobcentre Plus
at the core and the hub of the process initially for new claimants
but they have already said within the Green Paper that they will
probably extend that process to existing claimants as well. I
do not believe that that is a good way of moving forward. It is
more the strategy and the policy and, to some extent, the management
rather than the delivery by Jobcentre Plus.
107. Your criticism of Jobcentre Plus is that
it brings the benefits and the Employment Service together. That
was the whole point of Jobcentre Plus.
(Mr Charlesworth) I am afraid we would seriously say
that that is questionable. Psychologically we do not believe it
works. You need to split the two.
108. Is that just for disabled people or do
you think that is for all the other New Deals as well?
(Mr Charlesworth) No, I do not. The difference is
that the other New Deals have an element of compulsion for a start,
and they are for job seekers who are used to being engaged by
Jobcentres.
109. So it is not a problem for the other New
Deals? You just think you need a different model for New Deal
for Disabled People?
(Mr Charlesworth) Yes, which recognises the additional
barriers which disabled people often face.
110. When asked if NDDP has been successful,
three of you said "patchy", and I think the DWP would
say it is because of that patchy success that they would rather
have it in-house. In an area where Shaw Trust works it is great,
and where the Wise Group works it is great. You have providers
who are able to act as both providers and job brokers. However,
in Aberdeen it was very difficult for the local Jobcentre Plus
to find job brokers. They have had to take that in-house and go
out and find them as their only solution. What do you say to their
response to your criticisms?
(Mr Charlesworth) I can give a straightforward response
to that. That is their contracting and procurement policy which
has been flawed from the beginning. If you go out and appoint
contractors on the cheapest basis who have no track record, no
knowledge and no experience of working with a group, you will
get the results that you get. What I would say is that you have
had good providers—Wise, ourselves, West Country Training,
obviously, and Job broker Cymru who were the Jobcentre Plus themselves.
Many of the others had no idea and have been misled often by Jobcentre
Plus who originally, when launching a pilot, were advising would-be
providers that this could be done for ridiculous amounts of money
when it clearly could not.
111. There are two things you have said. One
was that you were against compulsion, but at the same time you
said that the difficulty you have is getting them through the
door. Once they are through the door you have been very successful.
(Mr Charlesworth) Yes.
112. What is your solution to getting them through
the door without compulsion?
(Mr Charlesworth) A much more positive message going
out, much more expenditure on the marketing side. Twenty 5% of
my costs are in local marketing. It is a shame we are not backed
up by any national marketing. You should be putting positive messages
across rather than threatening people's benefits; secondly, ensuring
that you have got the links to feed in from these other providers;
and, thirdly, being able to use the benefits system in a positive
manner to send out a positive message about the way in which you
can help people back into employment, which has been cut off under
the latest regime.
113. Can I ask the question of both the Wise
Group and UnumProvident? Do you believe what the Shaw Trust is
saying, that the model of bringing the Benefits Agency and the
Employment Service together in Jobcentre Plus is the wrong model
when it comes to delivering for disabled people, or do you think
that is irrelevant and it is actually about what is provided on
the ground?
(Mr Nicholl) I think it is about what is provided
on the ground by and large because, while everybody would like
to see more resource put into it, we have to be realistic and
say that it is unlikely that much more resource will be put into
it. It is then about using the money that is there as best you
can. Jobcentre Plus will almost certainly have to act as a job
broker of last resort in many areas where there simply is not
another infrastructure often because of the socio-economic profile
of that area. In places like the post-industrial conurbations
you often have all sorts of support mechanisms because there have
been many years of having to deal with mass unemployment, so you
have got a range of interventions there that can be brought together.
In places like Aberdeen, which is by and large a good deal more
prosperous, then you tend not to have that infrastructure to provide
support to people, so something like New Deal for Disabled People,
which does not have very much money, on its own just will not
do it. Somebody has to be there and I think Jobcentre Plus are,
as I say, the broker of last resort.
114. But you still need more money, I think,
coming into the system?
(Mr Nicholl) I think you need local flexibility and
you do need more money in certain areas. You need to use the money
differently and more intelligently in other areas.
(Ms Hindle) I would still try and distinguish between
stock and flow. On flow I do not necessarily agree with what Mr
Charlesworth was saying. I think most people flowing on to IB
do not come from other benefit; they come from work. They are
not out of touch with the labour market, and expecting them to
go into a Jobcentre Plus, the "Plus" hopefully helping
them with the disability issues, giving them work-focused interviews,
keeping work in the forefront of their mind, I think works and
should work. Stock is a very different issue. For people who are
out of touch with the labour market, to suddenly say to somebody
who has been on IB for eight years, "Come in for a work-focused
interview", will achieve nothing for anyone other than waste
people's time, frankly. We do need to look at the stock very much
more creatively, but for flow it is a good idea.
115. The next question is about the funding
which both voluntary and private sector organisations have criticised,
saying that paying organisations on the outcomes is quite damaging
because it is dependent on getting people into work. Is there
a process where contractors can be paid depending on how far they
can move a disabled person towards work? Is that a way forward
or is that a danger because the whole purpose is to get people
into work and if you fund it that way then that incentive to get
people finally into work is taken away?
(Mr Charlesworth) We are not opposed to the outcome
funding regime. What we are opposed to is the length of the contracts
which do not give you enough time to recoup your investment that
you need to make in up-front costs. The other thing is that for
the voluntary sector cash flow is very difficult if you are doing
large contracts and the Government are paying in arrears. They
have on other New Deals used payment on account which would be
a way round the cash flow problems. Obviously, if you do not get
the results you pay back the Government. We are not opposed to
the principle of payment by results; it is rather the method and
the time that you are given to make anything work.
116. Is that specifically because disabled people
take longer to get job ready?
(Mr Charlesworth) Yes, indeed.
(Mr Nicholl) We would welcome a re-balancing of the
way that the money is paid. There is no harm in output related
funding. It does sharpen the mind and focus people on what they
are expected to do, but at the moment a disproportionate element
of the risk, if you like, is placed on the delivery organisation.
It is not about more money again; it is about how you pay it.
Mr Stewart
117. What is your assessment of the extent of
discrimination against employing disabled people?
(Mr Charlesworth) There is a great deal of discrimination
that exists but it is not quite in the same category in my opinion
as race discrimination. Often it is more to do with lack of knowledge
and ignorance and to some extent fear. I know that could apply
in the race field but, having worked in Bradford and Rochdale
for many years, I think I know the difference, which is that race
discrimination is much more to do with personal prejudice, and
I am not sure it is personal prejudice that disabled people face.
It is more to do with lack of information and lack of knowledge
which lead to discrimination because the easier option is not
to employ disabled people. In terms of the answer as to what to
do about it, I do hope that the DDA does not fall into the same
disrepute that the old legislation fell into: six prosecutions
in 50 years under the old quota system, maximum fine £1,000,
and yet I worked for an authority employing 28,000 people that
had 0.018% people who were disabled and we were supposed to have
a 3% quota.
(Ms Hindle) Two comments, if I may. First, yes, I
echo specifically the point around fear and uncertainty and I
think that is particularly difficult for small and medium sized
enterprises, SMEs. A large company, such as Barclays, will have
huge resources in-house. They can say, "How do I cope with
it? What are the adjustments I need to make for somebody with
epilepsy, blindness, in a wheelchair?" A small or medium
sized enterprise has not got that resource in-house, does not
know automatically where to go and will not necessarily have the
time even to try and find out, so immediately you have got that,
"Too difficult, can't cope". The SME end therefore is
a particular problem. Engaging Jobcentre Plus in helping with
that must be key for me. We have done some work with Jobcentre
Plus where we have put together a briefing pack on a whole range
of disabilities and what employers can do which we have distributed
to every DEA in the country—there are some 8,000 of these
packs now out there—to try and say to DEAs, for when a small
employer asks what to do about epilepsy, "Look: here is something
you can point them to or photocopy for them". It is a huge
job because there are so many of them. Exactly as Mr Charlesworth
says, it is not deliberate discrimination; it is just fear or
uncertainty, or just that life is too short, "I am trying
to run a business here. I just cannot cope".
(Mr Nicholl) Clearly there is discrimination against
people with disabilities in the labour market. However, I think
the real test of the extent of that would come were unemployment
to rise. Nothing changes behaviour faster than money. We are in
a tight labour market where employers find it difficult to recruit;
therefore employers will make recruitment decisions they might
not have made five or six years ago when they had a larger pool
of people to choose from, and I think some of the progress we
have made may well prove to be short-lived.
(Mr Hardie) To echo David, we find it incredibly difficult
to detect discrimination, especially at the point of recruitment.
In practical experience of running an NDDP programme we have not
had any direct discrimination reported to us. That does not mean
it does not happen. To echo what Ms Hindle said, there is a continuing
educational issue that needs to be addressed.
118. You touched on advice and guidance to employers
and the role of large employers. Do you think it will be important
that we set up role models as employers, for example, large local
authorities, some health authorities, some blue-chip companies,
such as British Airways and Marks and Spencer, and let them lead
the way in terms of employing people with disabilities?
(Ms Hindle) Yes, but not just large ones. Find some
small ones as well and say, "Look: it is possible".
At an awards do last year—there is an award for the small
employer that has done most—the award was given to a small
pub somewhere in the West Country, the New Forest, I think. Literally
they had gone and got specially printed large-print menus, they
had got braille menus, they had put a ramp up at the front door.
They had just stopped and thought about it. They were recognised
nationally. They had said, "For us as a small business it
did not cost us that much and we just thought about doing it".
They never said quite why. It was wonderful; they just did it.
So find some smaller ones as well. Otherwise all that happens
is that small companies say, "I am not BAA, I cannot do it",
and immediately turn off again. Find employers anywhere in the
country who will say, "Here is what works for us; here is
why we did it, how we did it", and take some of that fear
away.
119. And presumably if we are going to look
at this we will need a decent publicity budget to make sure that
people do know about the successes.
(Ms Hindle) Yes.
(Mr Charlesworth) There are a lot of very good small
companies. We support over 3,000 people in the Workstep Programme
and there are a lot of employers who do over and above what could
be expected of them. They are role models but they are not publicised.
If you look at what is happening in terms of the funding that
you are putting into the New Deal, who is discriminating? The
employers or the state?
(Mr Hardie) I do not fundamentally believe that it
should be the Marks and Spencers and the like who are leading
the charge all the time. I think it is about getting a spread
of employers across a range of sectors and showing good practice
in that.
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