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13 July 2006 : Column 526WH—continued
“may affect morale and lead to increased turnover of staff whose skills are most needed to combat fraud and error.”
The Department’s permanent secretary, Sir Richard Mottram, told the Public Accounts Committee last year:
“If you want an honest discussion, that is the reality: official error has gone up because of organisational churn.”
It is unacceptable that an efficiency savings programme should lead to the growth we now see in official error. That “organisational churn” should not be considered inevitable when staff reductions and efficiency savings are made. What is the Department doing to get on top of rising error in the benefits system?
In the Government’s response to the Work and Pensions Committee, they mentioned a three-phase plan for improving income support accuracy. We require a clearer explanation of the plans, how they are delivered and how the variation between the delivery centres in the Government response will be addressed. We need more detail. Will the process-driven improvement mentioned in their response make any difference if error is down to low staff morale, insufficient training and poor IT procurement and transition? If those are the causes of the error, what are the Government doing to address those more fundamental points?
An interesting point is made in the Government’s response to recommendation 19, which called for output measures to be adjusted to reflect qualitative factors. The Government’s response stated:
“Analysis has shown that although the point scores were designed mainly to incentivise staff rather than as measures of social and economic value, they broadly reflect the net fiscal benefit to the Exchequer of moving a customer off welfare and into employment.”
The net benefit to the Exchequer is interesting information. Will the use of such measures be developed further? Will the information provided on net benefits to the Exchequer be made publicly available? Does it suggest the economic net benefit, too? Such information will, I believe, be important to monitoring the progress of welfare reform in the future, so again there is a lesson that can be drawn from that experience to shed a positive light on future proposals.
I hope that the Minister will be able to assure the Chamber that such analysis has been further developed and will be made publicly available.
Since the period reflected in the Committee’s report and since its publication, the Chancellor has made it clear that a further 5 per cent. efficiency savings will be sought from the Department for Work and Pensions. There will be yet further pressure on staffing and budgets. It is important that the Minister reflects on what lessons the Department draws from the episodes outlined in the report and how it will handle those future additional reductions.
That is particularly important when we look forward to welfare reform, when the Government are planning to spend an initial £360 million on rolling out the pathways to work scheme. Most organisations believe, and I share their view, that to be an inadequate level of funding for rolling the programme out comprehensively across the country. Additional efficiency savings are being sought, unemployment is rising, which is increasing costs, and the Department has been told that the money to be released into the pathways to work programme has to come from other savings in existing budgets, so it is clear that within the Department for Work and Pensions there is a great deal of financial pressure and pressure to make more efficiency savings. I am concerned that even the inadequate amount of money that has been made available to allow the pathways to work programme to be rolled out will be eroded and undermined yet further by the additional changes that will have to be made in response to the targets that have now been set by the Treasury.
There is a lot more for the Government to do to show that they are responding effectively to the concerns outlined in the Committee’s excellent report, and I look forward to the Minister’s response.
3.52 pm
Mr. Tim Boswell (Daventry) (Con): First, Mr. Taylor, may I say how pleasant it is to appear yet again under your chairmanship, and to do so on the occasion of an excellent Select Committee Report, which was well introduced by the hon. Member for Bradford, North (Mr. Rooney)?
The debate has been thoroughly constructive and all the speakers have added value, from my hon. Friend the Member for Weston-super-Mare (John Penrose), through the hon. Members for Stockport (Ann Coffey) and for Leyton and Wanstead (Harry Cohen), and on to the hon. Gentleman who has the magnificent title of the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander)—I think, for the first time in recorded history, I got that right. That is only a moment of levity in a serious subject. Everybody has had serious points to make and I am sure that the Minister will wish to respond appropriately.
With the exception perhaps of the defence of the realm, the prime duty of Government is to administer their business properly. I have a feeling—I will not dilate on it long this afternoon—that when the Government are finally laid to rest that will reflect a high degree of public resentment and even hatred at all the failures that have built up on their watch. There is no single, exciting event. There is no winter of discontent at the moment, no photo opportunity to draw people’s attention to, but
the reality of administrative failure is beginning to hit MPs in their postbags, and is no less real for being dispersed rather than concentrated.
It is all the more distressing, as certain members of the Committee have already acknowledged, when that failure impacts most heavily on those who are in some difficulty already, such as those who are out of work and looking for another job. Perhaps some of them are a bit less fluent, able, pushy or inclined to make a fuss than some of us might be in such circumstances, but the way that jobseekers of all kinds were let down in the summer of last year by what the Select Committee described as a “catastrophic failure”, to return to that phrase, was indefensible. I do not think that the Minister or his officials would seek to justify it.
One of the less appealing features of the present Government, in my view, is that Ministers invariably tend to blame someone else for failures within their Departments. It is perfectly true that Jobcentre Plus is an agency, and that Ministers should not be tearing it up by the roots and seeking to manage it themselves. However, responsibility for its conduct and the outcomes of its work must remain with Ministers and cannot be shuffled off on to officials who are doing their best in difficult circumstances.
The figures and the scale of the problem are not really in dispute, and they have already been touched on this afternoon. They were set out in a letter from the chief executive of Jobcentre Plus to my hon. Friend the Member for Runnymede and Weybridge (Mr. Hammond) earlier this week. She points out that in 2005-06, performance by Jobcentre Plus contact centres dipped to 62.4 per cent. against a target of 81.2 per cent. That was, she concedes, a result of the difficulties experienced in responding to customer calls during the summer months of 2005.
Meanwhile, almost on the same day, I received a helpful response from the chief executive, in which she gives details of action being taken to stabilise the performance of Jobcentre Plus including, interestingly—we have heard this phrase before—the launch of a national action plan on 30 January. I need add only that stabilisation is a concept drawn from the agency’s own words in its planning document. It is its word, not mine, and yet stabilisation is required only when something is manifestly out of control and needs stabilising.
My next point has already been referred to, but I make no apology for returning to it. I have personally awarded the Nobel prize for understatement and the Sir Humphrey prize for economy of language to the Government’s acceptance in their response to the Select Committee report that
“not everything has gone perfectly in Jobcentre Plus over the last year and that there were, and remain, some areas of difficulty.”
I can assure the Minister, having said that, that I do not intend to go along taking cheap shots this afternoon. We need to look forward as well as back and to use the example and the lessons of what took place better to inform administration for the future.
Danny Alexander: I agree with the point that the hon. Gentleman has just made, but is it not also important that despite the fact that this is in the past and the principal objective is to learn lessons from it, Ministers should also accept responsibility for the failures that are recorded in the report?
Mr. Boswell: I was perhaps rather generously assuming that the Minister would wish to make some statement with a word of contrition, as things have not been very good. It is all very well for us to say that as the political class, but it has been rotten for our constituents and the people who have been mixed up. I know perfectly well that many officials in the Department will be exposed to such situations day by day and are not happy about it either.
It is important that we both acknowledge the past and look forward to what should be done in the future. The two are interrelated, because we need to know better what took place and what went wrong in order to ensure that it does not recur. The careful work done by the Select Committee and the detailed responses that I have received in response to various parliamentary questions that I have tabled on Jobcentre Plus are some indication that the task is not impossible and may indeed be under consideration. I think that Jobcentre Plus would join me in admitting that there are still difficulties along the path.
As I have suggested, and as any former Minister needs to acknowledge, public administration is a difficult task. It is actually the most difficult task in public affairs. Politics is easy, but running a Department is not. Sometimes, it is a closed book even for Ministers. I have shown that I do not think that Ministers need to get their hands on every last detail and nor would they be thanked by officials and others if they did, but they need to have some understanding. I do think, though, that even within the time constraints our exchanges and the Committee’s inquiry have been useful in beginning to develop an informed view.
I endorse the Select Committee’s view that the historic situation arose from a mixture of problems rather than one single problem—for instance, IT problems, staffing issues and poor change management programmes. I might add that, in my view, the pressures have been further aggravated by the Gershon review, under which head-count reductions in Jobcentre Plus alone will amount to 15,000 full-time equivalents over a four-year period. That represents half of the Department’s commitment to reducing the head count. Interestingly—I shall not ask the Minister to expand on the point—that comes at a time when, because of its undoubted problems, some staff are being moved in to increase the complement in the Child Support Agency; the overall picture will therefore be more difficult to fulfil without further reductions in Jobcentre Plus or elsewhere.
We on the Opposition Benches do not challenge the principle of Gershon. Indeed, I might go further, and say that the broad thrust of the Government’s modernising is right. However, it is important that it should be conducted within certain parameters, and I list three.
First, it requires careful change management to effect it successfully and without a reduction in quality, which is a commitment of Gershon and of the Government. They say that the changes can be made without reducing the quality of service to users.
Secondly, I remind the House of the explicit commitment to retain the service level; that should therefore be implicit in everything that is put in place.
Thirdly, as the hon. Member for Inverness, Nairn, Badenoch and Strathspey said, further disturbing pressures are building up as a result of the Chancellor’s statement earlier today about further reductions. Again, it is not that we are against them. I take the spirit of my question to the Chancellor when he announced round one; I asked how much consultation had taken place and whether it was possible to secure the objectives without the loss of service. Those are real questions, and Ministers will have to worry themselves through to the answers.
It would be helpful in his response—the Minister will have quite a bit of time—if the Minister could reflect on five issues that arise from the report and one or two other concerns. First—I think that no one has touched on this, but it is mentioned in the report—there is the roll-out of the Jobcentre Plus process. I know that Ministers are pleased with the change to job centres. A couple of years ago, I had the opportunity to open one in my constituency. Things are definitely better than under the old arrangements. I do not argue about that. The changes are supposed to be substantially completed by July—later this month. Will the Minister confirm that we have got there at last? It has been an expensive process, and although we are not debating it today, it would be useful to know that it is completed.
Secondly, I thought that my hon. Friend the Member for Weston-super-Mare was going to mention it, and the Minister owes us an explanation, but I note that the Select Committee recommended that a report should made to it on financial performance as against budget. That is not quite the same as individual performance targets by region or otherwise, of which my hon. Friend spoke. We were promised that information before the summer recess. We do not have long, and it would be useful if the Minister could give us an indication of the time scale, or even report financial progress as against the budget for Jobcentre Plus. At this point, I reinforce my hon. Friend’s plea for better management information, whether or not it is made public to us. Until Jobcentre Plus knows accurately what it is doing, it will not be able to respond to the challenges that it faces.
Thirdly, and partly in answer to questions already asked—Members can have a little fun in asking questions—the Minister’s Department has set up an error task force. We need to know where that is going and whether it will deal with the problem. Just having a press release and saying that one has set up a task force will not undo the difficulties that have arisen because of unmanageable pressures, but I hope that it will make a real contribution.
Fourthly, I am worried about the disappearance of the building on the new Deal programme. I agree with what has been said. I recently tabled a question on what had happened and what lessons had been learned from the pilot schemes. The answer can only be described as stasis. Nothing appears to have happened. Perhaps the budgetary pressures are insurmountable, but Ministers must explain what has happened.
Finally, going back to the service delivery and last year’s experiences, can the Minister report to the House what progress has been made in stabilising the benefit centres? Of 22 centres, seven were not fully back on the automatic customer management system. Has that number reduced? In the present circumstances,
ensuring that benefit centres are fully functional is a necessary condition for short-term improvement. In the longer-term, Ministers and the agency management need to concentrate on the major reforms that they are undertaking. Some, like the single operating plan referred to in the Committee report, could be generic, and they are easily woven into other sorts of changes.
I emphasise that it is important to concentrate on the main task and to avoid additional initiatives—eye-catching or otherwise—like the plague until they are sorted. I am afraid that history, and not only in this Department, is littered with ideas like the ambition programme—ideas that peter out, that make no long-term contribution and that are not pursued. That is not an argument for everything to be done at the same time, it is an argument for concentrating on the essentials and to ensure that initiatives do not proliferate.
Underlying this, appropriately, are issues of staff training and morale. I recognise the difficulties referred to by the TUC representative of the Department simultaneously making changes and cutting the head count. It is clear, indeed Ministers have replied fairly frankly about it, that there are outstanding industrial relations issues; continuing reports, not only from the unions, show that morale is low.
In a sense, all those problems are interlocking. A Department and an agency that have not got on top of the means of change, that in consequence are prone to the risk of further service failures, that along the way have neither trained nor motivated a significant or satisfactory number of staff to the required level remain vulnerable, just as the client route remains vulnerable. That is a continuing source of worry.
I do not want to sound relentlessly negative. Much good thinking is going on, with some good initiatives and ideas. In a sense, and without removing ministerial responsibility, we need to allow the Minister and the agency a bit of space to get themselves sorted out. But they must be sorted.
I have three remaining points to make in conclusion. First, despite my somewhat limited knowledge of Jobcentre Plus operations, the targets on which they report to management, and ultimately to Ministers, have some potential for being massaged locally. I am told that it is not too difficult to win performance points by recording individual job seekers not just as unemployed but as being on income support, or as having disabilities—or even to massage their residence by not entering the postcode correctly. If such practices are widespread and are not picked up by internal validation through a departmental audit, it will not only distort staff remuneration reporting but it may impact on the overall reporting of job centre figures and achievements. Indeed, it may simply distort the whole pattern being presented to Ministers.
That may have been true of job entry analysis, but even moving to job outcomes does not automatically nullify the point. Such issues are sensitive, and Ministers do not always get inside them easily because of their degree of distinction from the level of operation. However, I have concerns about these issues. Will the Minister consider some external independent validation of the extent to which such practices have become widespread? Perhaps a sample analysis could be undertaken.
I touch only briefly on the political point: some of the problems may have arisen as a result of the Government’s overblown target culture. I am much more concerned that there should be propriety and that Ministers should be told what is actually happening, rather than what people think they would like to hear.
I share the Select Committee’s concern about the disruption of the agency’s contracts and relationship with private sector, including voluntary sector, providers. I hope that every effort will be made in that area and other areas of departmental business, to restore and make more responsive good commercial and proper business relations. As is clear from the pathways to work exercise, about which I spoke briefly only this afternoon, the Government are belatedly coming to terms with the need for an active private or voluntary sector contribution, and that is an opportunity that the Minister may wish to develop. However, he will have to do that on the basis of a good commercial and business model.
I am not the first to make a point about the increase in claimant count. I draw the Chamber’s attention to paragraph 86 of the report; the Committee’s conclusion was simply:
“If the increase in the claimant count continues it will undermine the efficiency savings programme.”
That fear is not confined merely to jobseekers, but applies more widely to the Department’s situation and finances.
I should add another point, which has been eloquently put in this debate, about service to claimants or users. Such people are human beings; the Department should not show only a technical face in its activities, but a human one. If people have disabilities, cannot hear on the telephone, cannot get to the jobcentre or whatever, somebody has to sort those issues out, no matter how much technology there is. Acting in such cases is a proper use of public resources; if necessary, resources will have to be rebalanced. We cannot get away from providing a service to members of the general public.
In thanking the staff and others, I am reminded that Jobcentre Plus and its staff lie on the front line of meeting the needs of some very vulnerable people. Those who work for the agency need the tools and the leadership to ensure that they can do their jobs properly.
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