Supplementary memorandum by Jobcentre
Plus to the Work and Pensions Committee November 2005
1. INTRODUCTION
1.1 This memorandum provides the Department's
written contribution to the Work and Pensions Select Committee's
one-off evidence session with the Chief Executive of Jobcentre
Plus on 9 November 2005. It is intended as a supplement to the
Jobcentre Plus Annual Report and Accounts 2004-05, published on
26 October 2005, which provides the main written evidence for
the hearing.
1.2 Jobcentre Plus was established as an Executive
Agency of the Department for Work and Pensions (DWP) on 1 April
2002, bringing together those parts of the former Benefits Agency
that dealt with people of working age with the whole of the former
Employment Service. The aim of Jobcentre Plus is to provide "work
for those who can and support for those who cannot". Annex
A summarises Jobcentre Plus' purpose, objectives and vision.
1.3 Every working day, Jobcentre Plus receives
13,000 vacancies from employers, conducts 36,000 work-focused
interviews, helps 4,800 people into work and processes over 16,000
new benefit claims.[1]
2. JOBCENTRE
PLUS PRIORITIES
IN 2005-06
2.1 Transforming for customers. Jobcentre
Plus is implementing an enormous change programme, and is transforming
its service to customers in a number of ways, for example:
— changing the way Jobcentre Plus
interacts with its customers, completing the majority of the rollout
of integrated offices, starting the centralisation of benefit
processing activity and establishing a national network of contact
centres;
— adopting a national delivery model
for employers;
— supporting the transition into work
for priority customers, building on the Pathways to Work Pilots
for Incapacity Benefit customers and lone parents;
— developing effective partnership
working with various organisations including other parts of DWP,
Local Authorities, Learning and Skills Councils, the private sector,
voluntary organisations and other Government Departments; and
— developing e-services enabling customers
to claim some benefits online.
2.2 Delivering performance. The Agency will aim
to continue its successful performance record in 2004-05. The
target structure for the current year is broadly similar to the
one that has been in place for the last two years. The targets
comprise: helping customers into work (job entries), the monetary
value of fraud and error, employer outcomes, customer service,
business delivery, and unit cost. More detail on performance in
the first half of 2005-06 is included at section 4 and Annex B
of this document.
2.3 Delivering services more efficiently and
effectively. Jobcentre Plus is reducing staff and non-staff costs
and streamlining internal structures. Efficiency and effectiveness
are being improved in a number of ways including:
— introducing a Standard Operating
Model across the business;
— ensuring local offices focus on
intensive help for priority customers;
— promoting the payment of benefits
directly into customers' bank accounts as the most secure method
of payment;
— continuing to monitor contracts
with external providers in order to achieve the best value for
money;
— working with employers and customers
to help them to access Jobcentre Plus services through new channels
(telephony and electronic services);
— introducing a new governance framework
to ensure risk is properly considered and managed in all new developments;
and
— commencing a programme of work delivering
major changes to IT and business processes.
2.4 Delivering the Values through our people.
Jobcentre Plus will ensure that its people are best placed to
meet business needs by focusing on providing the key skills and
development required to support individuals and to build leadership
capability. The Agency supports its people through the transformation
of the business by ensuring regular communications and programmes
of activity aimed at building the future culture, capabilities
and ways of working. It is actively engaging with its people and
taking forward action to address the issues raised in the annual
staff survey.
3. KEY DEVELOPMENTS
IN JOBCENTRE
PLUS IN
2005-06
3.1 A fundamental Organisation Design Review
has been completed and is now being implemented to develop new,
affordable management and support structures that will underpin
the way Jobcentre Plus will deliver its services in the future.
Good progress is being made in implementing the new organisational
design. This is a key part of the Jobcentre Plus Vision for 2008,
transforming the way that the Agency is organised at national,
regional and district levels to ensure that internal structures
support its delivery network and the delivery of services to customers
in the future. The new structures will be in place by March 2008.
3.2 The Jobcentre Plus Implementation Programme
plans indicate that the rollout of new offices and services will
be substantially complete by July 2006. At that stage 862 sites
will have gone live leaving 25 sites to be rolled out. Firm estimates
show that the programme will be delivered to the original £2.2
billion budget. Programme checkpoint arrangements have been intensified
with the specific focus on delivery of the remaining sites to
plan, as well as on the closure and disposal of those sites where
services will no longer be delivered. As of 25 October 2005: 652
sites are operating the integrated service; 235 sites remain to
be rolled out; plans are in place to complete the introduction
of the Customer Management System (CMS) into all offices by May
2006; CMS has been rolled out to all Contact Centres. The Agency
introduced new service measures on 17 October to support end-to-end
management of the business processes. These measures have improved
Contact Centre performance. A full performance improvement plan
is also in place to build on these immediate performance improvements.
3.3 A programme to centralise benefit processing
activity has commenced, with plans in place for the final locations
of the 77 benefit processing sites. Planning is underway to develop
a detailed timetable for the work. Centralisation will enable
improved performance management and, in time, workflow management
of benefit processing and provide a better platform for IT improvements.
3.4 Jobcentre Plus contracts with very large
numbers of providers from the private and not-for-profit sectors
to provide support to those customers who most need help. In that
context, the Agency has developed a procurement strategy that
aims to promote and sustain provider capacity across its District
network while ensuring value for money. There are many calls on
the overall funding available for employment programmes and Jobcentre
Plus has to ensure that the budgets for all programmes support
its priorities.
3.5 Delays experienced this year in announcing
extensions to current contracts reflected the need to review Jobcentre
Plus contracts prompted by the Department's Five Year strategy
and the level of the Spending Review settlement announced in the
2004 Budget statement. Accordingly the planning for this re-contracting
included a critical review of the range and scale of current contracts
to maximise the availability of high quality provision while ensuring
that Jobcentre Plus lives within its means. Maintaining the availability
of the New Deal mandatory options nationwide remains a high priority.
3.6 In February 2005, Pathways to Work was extended
to existing Incapacity Benefit (IB) customers who have been in
receipt of benefit for between one and three years in the seven
pilot districts. It is too early for any detailed evaluation of
this extension, but in the first six months, 13,600 existing IB
customers have attended at least one work focused interview and
around 12% of these have been referred to some element of the
Choices package of further support, eg New Deal for Disabled People.
A further four Districts will begin to deliver Pathways to Work
from 31 October 2005. Pathways performance continues to be very
encouraging; initial evidence suggests that there is an impact
on the Jobcentre Plus Target for helping sick and disabled people
into work in the pilot Districts. Job entries in the operational
year 2004-05 increased at a greater rate in Pathways pilots than
in the rest of the country. To the end of June 2005 there were
17,150 job entries in the Pathways pilots.
3.7 Jobcentre Plus' success in tackling fraud
will be built on by the creation of a new national Fraud Investigation
Service to investigate more complex and serious cases, which will
be rolled out from April 2006. This is a DWP-wide function,
managed and operated by Jobcentre Plus for the whole of DWP. The
new service will concentrate on cases that are likely to result
in a criminal sanction. Setting up a single service accords with
the principal recommendation of the Scampion Report to create
a single investigation Agency.
3.8 Jobcentre Plus will have implemented a Customer
Compliance function by April 2006. This will engage customers
who fail to report changes in their circumstances on time by addressing
risks in benefit cases where a full fraud investigation is not
deemed appropriate. There will be intensified action to identify
any incorrectness, put it right, recover any overpayment, and
ensure future compliance by customers with their responsibilities.
3.9 Since January 2005, Jobcentre Plus has been
piloting new ways of measuring its effectiveness in helping people
into work. The Job Outcome Target (JOT) pilots have been subject
to evaluation and the introduction of a new job outcome measure
nationally from April 2006 is under consideration. The new target
would be based on linking Jobcentre Plus customer records with
employment data held by Her Majesty's Revenue and Customs (HMRC).
The new measure, if adopted, would enable more efficient data
capture and provide a more complete picture of Jobcentre Plus
performance.
4. JOBCENTRE
PLUS PERFORMANCE
IN 2005-06
4.1 The Jobcentre Plus Annual Report and Accounts
2004-05 includes full coverage of the Agency's performance in
2004-05. Annex B to this document gives details of targets for
2005-06 and actual achievement to September 2005.
4.2 Performance to the end of September 2005
indicates that Jobcentre Plus is on schedule to hit four of its
six performance targets in 2005-06. Performance on job entries
and job entry points is currently below profile, and a simple
extrapolation of this level of performance for the full year would
show a shortfall of 7% against the 2005-06 target. However, this
does not take into account the National Action Plan, which is
aimed at recovering performance towards meeting the target. The
plan includes action on helping Personal Advisers to improve effectiveness,
employer-related services and detailed performance improvement
planning to support delivery of the target in the final quarter
of 2005-06. The Chief Operating Officer will implement regular
reviews against the plan to ensure that all parts of the organisation
are contributing towards delivery of the target.
5. PROGRESS ON
EFFICIENCY
5.1 In order to support DWP in its delivery of
its efficiency and reform agenda, Jobcentre Plus is engaged in
a major business transformation programme, which represents a
huge challenge for the organisation.
5.2 The delivery of the Jobcentre Plus efficiency
challenge must be seen in the context of a reduction in 11,000
full time equivalent staff (FTE) from its launch in April 2002
to the end of March 2005. It faces a further challenge to reduce
by approximately 9,000 Full Time Equivalent (FTE) in the current
Spending Review period, to contribute to the overall DWP target
to reduce headcount by 30,000 by March 2008. In the same period,
Jobcentre Plus will also re-deploy substantial numbers of staff
to customer facing roles by March 2008, as the major contributor
to the DWP target to redeploy 10,000 staff to customer facing
roles.
5.3 To manage these challenges, Jobcentre Plus
launched Delivering Our Vision, a comprehensive programme that
sets out its plan for achieving the efficiencies required to live
within the Spending Review 2004 settlement. The Delivering Our
Vision Programme includes initiatives to improve efficiency, transform
the business and introduce policy change across the whole range
of Jobcentre Plus business. It incorporates key elements of the
Agency's Change Programme including major initiatives such as
Jobcentre Plus rollout, Benefit Processing Centralisation and
the Organisational Design Review. There is a comprehensive programme
of communication and engagement with people across Jobcentre Plus
about the Programme.
5.4 The effect of the Delivering Our Vision Programme
will be to introduce new and improved processes, structures and
IT into the business, which will in turn enable it to reduce headcount
whilst maintaining performance across the organisation. Delivering
our Vision initiatives are aimed at supporting consistent performance
across the organisation, focusing on:
— headcount reductions in support
functions rather than frontline services;
— supporting individuals and teams
to identify, plan and implement performance improvement; and
— reviewing structures, policies and
processes to ensure they are supporting frontline staff.
6. CONCLUSION
6.1 Jobcentre Plus is engaged in a major and
complex transformation programme with a focus on improving services
whilst reducing costs and headcount. The Agency is committed to
achieving both, and has plans and programmes in place that will
enable it to do so. Substantial progress is already being made,
illustrated by the key developments in section 3 of this document.
1 "Every Working Day", Jobcentre Plus Internal
Communications Unit, December 2004. Back
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