Select Committee on Work and Pensions Sixth Report

4 Administrative structure

26. The system for managing and administering ESF in the UK is very complex. Although the Department for Work and Pensions (DWP) has overall responsibility for policy on ESF within the UK, most of the administrative tasks are performed by other departments and bodies. As regards policy, the European Social Fund Division, which is part of the Department's Joint International Unit with the Department for Education and Skills, takes the lead responsibility on ESF.[30] In very broad terms, within the context of the EU, the Joint International Unit seeks to place the UK at its most advantageous position within the EU. For example, it may seek to minimise the UK's net contributions to the EU budget by constraining the growth in the ESF budget-line and consequently the overall EU budget.[31] In addition to its overall policy responsibility, DWP is also responsible for managing Objective 3 in England (and Gibraltar) and the Equal Initiative in Great Britain.[32] However, while the DWP is heavily involved at these higher levels of policy on ESF, the responsibility on the ground for the administration of the ESF lies elsewhere. On a day to day basis, the responsibility for administering ESF and about 84% of the ESF Objective 3 budget is delegated to Government Offices within England, [33] which fall under the departmental responsibility of the Office of Deputy Prime Minister (ODPM), and to the devolved administrations.[34] In Scotland and Wales, the Scottish Executive and Welsh European Funding Office (an executive agency of the Welsh Assembly Government) are responsible for the implementation of Structural Fund programmes and making ESF payments to projects within Objectives 1, 2 and 3 in their respective countries. In Northern Ireland, while the devolved arrangements are suspended, the Northern Ireland Office is responsible for the implementation of Structural Fund programmes.[35]

27. In England, Government Offices administer the ESF on behalf of the Government in its capacity as managing authority for the Fund in the UK. Although the details may vary slightly from region to region and depending upon which Objective is being considered, the core responsibilities of each Government Office within England are the same. The Government Office puts in place a regional management structure for the Fund, which includes the key decision-making bodies (the Regional Committee for Objective 3, or the Programme Monitoring Committee, for Objective 1 or 2). The Government Offices chair these committees and provide the secretariat function for managing the project selection and monitoring process, including taking decisions, issuing grant letters, granting claims, monitoring expenditure and inspecting projects.[36] Ms Henderson (Government office , South West) said that "over and above all this" Government Offices also make sure, with their regional partners, that the programmes have a strategic focus and are benefiting the region.[37] The Regional Development Plan (RDP) identifies the activities that are to be supported at the regional level.[38] To the extent that other bodies undertake the administrative functions, the DWP takes a back seat in those Objective 1 regions and 2 areas where ESF activity supports ERDF projects. For example, within Objective 1 and 2 areas of England ODPM is the lead department for regional affairs and regional Structural Funds programmes, even when the ESF is involved.[39]

28. The primary responsibility for co-ordination of structural funds lies with the UK Structural Funds Steering Group, which is chaired by the Department of Trade and Industry (DTI). The DTI is the co-ordinating Department for Structural Fund policy within the UK.[40] The DWP holds UK liaison meetings on ESF matters with the devolved administrations and attends networking meetings with Government Offices. This scattering of the responsibility for policy and administration between the various Government Departments and devolved bodies inevitably constrains the extent to which DWP, acting alone, can implement changes to the way in which ESF is administered. For example, the Minister told us that it would be wrong for the DWP to make any judgements about the decisions by the devolved administrations.[41] Our recommendations seek to reflect this reality. We concentrate on Objective 3 (England) funding and Equal initiative since this falls within the responsibility of the DWP. Wherever possible we make comparisons with the experience elsewhere.

Role of mainstream sector and voluntary and community sector

29. A large proportion of ESF grant is channelled through mainstream training and employment bodies, such as colleges of further education, local authorities, Connexions Partnerships, Business Link operators, Regional Development Agencies, Higher Education institutions, trade unions, private companies and other mainstream providers. However, during our inquiry we also heard about the important role played by the Community and Voluntary Sector (C&VS), especially in connecting with hard-to-reach groups. For example, on a visit to Newham, East London, we found that a project successfully attracted women who, for one reason or another, felt generally excluded from mainstream education /training services. In Edinburgh, we visited a similar project that provided skills training to hard­to­reach people from minority ethnic groups. Ms Flanagan (Chair-TSEN) illustrated the distinctive contributions of the mainstream and the C&VS. She said:

30. The role of the C&VS organisations was also illustrated by Mr Pascoe (LSC) who told us

    "A lot of this money is actually going into organisations that may be working in the community that can get it, perhaps young people who opt out of education, who are not going to come to the mainstream programmes. They are just not going to come to a FE institution; somebody has to go out there, get them, engage them, build their confidence, give them some basic skills in order to get them to a point where they will then come into the mainstream."[43]

31. Compared with other EU countries, the C&V sector in the UK has greater direct access to European Funds. [44] We are aware of the threat that the C&VS sector could become over-professionalised with the loss that that entails to the sense of community and motivation of the volunteers. However, we see nothing wrong in the community and voluntary sector adopting a more systematic approach if it improves efficiency and effectiveness. As one project provider in Seville told us, the methods used for their ESF supported projects, such as the need to demonstrate added value and performance against targets, were also adopted when dealing with their other work since they saw the benefits of the approach.

32. ESF is involved in jobs, training and not just countering social exclusion. As Mr Cragg (LSC-Birmingham and Solihull) explained ESF Objective 3 is

    "going towards addressing issues like basic skills in the workplace, qualifying those who, although in work, are not qualified and do not have transferable skills, and making therefore a wider economic contribution in terms of key sectors of employment and key occupational areas where people are not adequately skilled."[45]

33. We welcome the involvement of a diversity of organisations that this remit brings. We would not like to see ESF restricted to jobs and training only for the enterprise sector.

30   In terms of organisation, the unit reflects the link between the skills agenda and employability, which is mirrored in the ESF area. See Q179 Back

31   Q219 Back

32   DWP's specific tasks in this area involve programme delivery, monitoring and liaising with other departments (e.g. with Home Office). The DWP also provides the accounting officer for ESF. Back

33   Government Offices perform the various tasks of separate Whitehall departments. In this sense they are Whitehall departments in miniature. Back

34   ODPM also has responsibility for managing Objectives 1 and 2 in England. Back

35   Further details are available in Ev 90, including the arrangements or managing transitional arrangement in Highlands and Island and Northern Ireland. Back

36   The Monitoring Committees represent the range of partners who help to deliver ESF In England. Objective 3 includes not only the European Commission, regional Government Offices and co-financing organisations but also trade unions, employers, Higher Education and Further Education organisations, local authorities and v&c groups.QQ78 and 177  Back

37   Q78 Back

38   A Regional Development Plan expresses what the national employment plan means in a particular region, by describing the economic conditions in the region, such as, unemployment and sparsity of population and deriving a set of regional priorities around specified themes. The analysis leads to conclusions about the various activities that might be carried out within the already pre-set policy fields within the programme. See QQ79 and 83 Back

39   Q179 Back

40   The Steering Group includes DTI and other departments, devolved administrations and Government Offices. Back

41   Q210 Back

42   Q151 Back

43   Q48 Back

44   Q130 Back

45   Q49 Back

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