Examination of Witnesses (Questions 1
- 19)
TUESDAY 31 OCTOBER 2006
MR RICHARD
CAIRNS, MR
LAURIE RUSSELL,
MS KATE
STILL AND
MR DAVID
COYNE
Q1 Chairman: Good morning, everybody.
It is good to see you here. Thank you for coming to join us. As
you know, the Committee is doing an inquiry into the Government's
80% employment target and how we might possibly get there. We
are hoping that you are going to help us this morning and we are
going to leave with all the answers. It is good to see you all.
We are challenged on time so we will jump straight into this if
everybody is happy. Some have argued that the biggest challenge
facing the Government to achieve this target is the big cities
like Glasgow with the complexity of the problems that they have.
What do you think are the key challenges to increasing the employment
rate here?
Mr Cairns: Would you mind if I
start? I think the first thing to say, and you will have heard
this last night from the Leader of the Council, is that we welcome
the ambition of achieving an 80% employment rate and clearly we
recognise the fact, and we know the Government does, that the
key to achieving it is to take advantage of the economic growth
that is taking place in the cities. That is clear. It is also
clear that unless that rate of economic growth continues in the
cities the 80% employment rate is not achievable. As for the challenges,
you probably know also that whilst the employment rate in Glasgow
and the other main cities in the UK is doing better than in the
country generally we also have lower employment rates, and Glasgow's
is one of the lowest with one of the highest economic activity
rates. The challenge is around how one takes advantage of the
jobs growth that is taking place and in some way link that to
those who are not currently in work, whilst at the same recognising
a couple of other things that are worth mentioning that you may
have heard. One is that the employment rate in the cities is artificially
depressed by things like large student populations who count in
the population but who do not count against the employment figures,
so one of the things one could usefully do would be to find a
way of discounting some of these things, not to cheat the figures
in any way but to give a more useful representation of what an
80% employment rate would really mean. The other thing that we
are slightly exercised by, in addition to the set of challenges
about how we get our own workless back to work, is recognising
that at the same time we are now in an environment of net in-migration
to cities. Whilst we do not know what the scale of that is in
Glasgow yet, that of itself will both drive the employment rate
up because most in-migrants are coming here to work and are finding
jobs and as a consequence the employment rate in that sector of
the population is much higher, but at the same time to some extent
that will make the process of placing indigenous Glaswegians,
if you like, into work yet more challenging. That is both the
opportunity and the challenge as I would currently characterise
it. My colleagues may have other things they may want to add to
that, specific items of detail if you like.
Mr Russell: Could I add two further
points to the challenges. We probably would accept that the broad
targets that have been set for us at the moment are extremely
challenging and may be unrealistic in terms of timescale and numbers.
We may need to look at a longer timescale in terms of hitting
that target of 80%. Secondly, we need to be much clearer about
how we deliver the various activities that organisations here
and others are delivering so that we get the best out of those.
We are going to have to up our capacity. I think the only way
we will do that is by working better together and making sure
we get the right blend of various organisations and how the further
education infrastructure, which is good in the city, works with
us to deliver. The second point, which is linked to further education,
is about being better at re-skilling. Although we are creating
jobs at the moment we need to make sure that we get our people
the right skills to take up jobs, sustain jobs and then move on
when they are into jobs.
Q2 Chairman: If I could just pick
up your point on the targets. Targets are only any good if they
are challenging; if they are too easy to achieve you might as
well not have them. Where do you think Glasgow should be in five
years' time on the employment rate?
Mr Cairns: The object from the
Welfare to Work Forum is to put a further 40,000 people in the
city back into work by 2009-10 from a base in 2003-04. Even if
we achieve that, and that is a fairly stretching target for a
variety of reasons, that will only take the employment rate in
the city up to 75%, which would be a record employment rate for
this city. If we wanted to get the employment rate up to the 80%
target we would have to get not 40,000 but 54,000 people from
benefit into work. At this point in time we are not in a position
to calculate the effect of in-migration on that and there still
needs to be more work done on the changing demographics in the
city, but by and large the 40,000 target would take us to the
highest employment rate in the city's history and even that would
still be well short of the figure we would have to hit to reach
an 80% employment rate.
Q3 Justine Greening: Just a quick
question. You referred to the migration of people moving into
the city and it sounds like that is significant enough that it
is going to be a key aspect of things that you consider if you
are going to get close to reaching it. Is that fair to say?
Mr Cairns: It is but I would not
want to place too much emphasis on it, demonise it in any way
or exaggerate it. It is really a contributory economic factor.
On the one hand this will drive up the employment rate because
the majority of migrants come and take work almost immediately
and they tend not to bring dependants with them, so for a variety
of reasons it will drive up the employment rate, but at the same
time for some sectors of the population it makes the business
of placing indigenous citizens into jobs more challenging. On
balance it is undoubtedly a positive factor and clearly it is
a driver for economic growth and without that growth we will not
hit the employment rate.
Q4 Chairman: Professor Turok made
the argument that you need a detailed breakdown of everybody who
is on inactive benefits, their individual needs, capacities, et
cetera. Is that feasible and, if it is, how would that contribute
to the Cities Strategy?
Mr Cairns: I will invite anyone
else to make a contribution before I do.
Mr Coyne: I do not know how feasible
it is to do that analysis but I think it is essential to our understanding
of the challenge in Glasgow to recognise that most of the workless
people in Glasgow are workless for more than one reason, whether
that is low skills, caring responsibilities, substance abuse problems
or a criminal record. Most people are out of work for more than
one of those reasons and, therefore, a simple categorisation by
type of benefit probably does not give you the tools you need
to understand the pathway to work. There is a need for multiple
interventions along a pathway to work and the more intelligence
we have about tracking people through that the better.
Mr Cairns: In relation to the
City Strategy, and Kate may say something about this, one of the
things that Glasgow's Equal Access project is developing, and
I am sure other people are doing the same thing, we will not be
alone in this, is looking at a single client tracking system for
the city that will track the circumstances of individuals, data
protection issues notwithstanding because clearly we would have
to address that, the nature of the interventions that take place
with each individual and the nature and rate at which they progress.
Whilst I do not think we should underestimate how difficult it
will be to put such a thing in place, I agree with Ivan that some
better detailed understanding that allows us to design the services
and crucially measure the effectiveness of what we are doing is
clearly pivotal to the whole process. I would not presume to disagree
with Ivan's analysis.
Ms Still: I think a lot of work
that has been done in the city is to try and track the engagement
of people with services within health and social care services
and how they engage with, and are encouraged to engage with, the
training and employability services. A major part of that tracking
is to see who is providing the range of interventions that will
take people on that journey from unemployment to employment. There
is also the notion that you have to have a starting point, so
there has been some work done about the types of individuals,
the categorisation, which is not about a lone parent, because
as David has said a lone parent will have another range of issues,
they might be a lone parent but they might have a substance misuse
problem or other issues like debt problems, it is looking at where
is the starting point for an individual and trying to track them
over that range of interventions to see what is making the difference
for that individual. That is the kind of thing we want to encourage.
Q5 Chairman: Am I right that your
organisation has been doing some research into what people see
as their own barriers?
Ms Still: Yes. There has been
a piece of work done in terms of user involvement and they have
come up with a range of things. They talked about the attitudes
of the people that they engage with, for example within health
and social work. Traditionally those organisations have not been
focused on employability, they have dealt with people's health
or their housing. It is at what stage would you mention to people
about the benefits of thinking about work and do those working
in those services and sectors know enough about where to refer
someone on if they are interested. It is not about trying to force
people along routes but it is making sure they have information.
One of the things users have said is they would like to have a
pack of information to know where they can go, who they can contact
and where they will get the correct information about the services
that would help them. That is one of the things users have actually
said they would welcome. Attitudes to individuals is a big key
barrier at the moment in different employability and health and
social care settings. We have been doing a lot of work around
attitudes and attitudinal surveys and baselining that so we can
deal with that issue.
Q6 Chairman: Do people feel they
are just a number in a system or are there some parts of the system
that recognise them as individuals?
Ms Still: I think they are asking
for person-centred approaches. In terms of user involvement a
number of services have got user engagement groups. That is a
piece of work we were doing, asking people in user engagement
groups how they want to influence and shape the planning of services.
That is one of the things that Equal Access is trying to work
with. One size does not fit all, there has to be a range, a buffet
of options for people to engage with and shape services. That
is the kind of thing we are asking for and trying to drive forward.
Mr Russell: The Wise Group did
a survey of over 1,000 of the trainees who have come to us from
different benefits and looked at the various barriers that they
perceive to employment. We found that the average was three barriers.
We have got a percentage breakdown. The highest percentage was
being a member of a workless household and the second highest
was a lack of qualifications, but it was also other barriers like
homelessness, whether they are a lone parent, of ex-offender status,
et cetera. We have got a breakdown of the various types of barriers.
We have also looked at for what reasons people take time off a
training course, which is another reason that if people are going
to get into work they have to resolve those problems before they
do. That is for a later discussion maybe. In terms of the initial
barriers, we are finding that the clients we are working with
have an average of three barriers and 82% have two of these barriers
to getting into work. I agree with Kate, it has got to be a personalised
process that can work with the individual and tackle the individual's
problems in as holistic a way as we can if we want to get people
into work and then sustain them in work.
Q7 Chairman: Those personal barriers
are about how the service is delivered surely, it is not a matter
of policy, it is the infrastructural things where there is a policy
focus needed. Are you satisfied on what you have seen that personal
advisers are up to the job at locating and addressing those personal
barriers?
Ms Still: The feedback from users
is there is a range: some people are very good and some people
are not so good. The important thing is to do the training around
what is a person-centred approach so that people are adopting
practices which are person-centred and influenced and shaped by
how users want to be approached. Some have mentioned stigma around
perhaps a client group, getting rid of things like that so that
people know how to approach a person in a centred way so that
they do not approach them with preconceived ideas about a client
group.
Mr Coyne: Our experience adds
to that. We find working with lone parents that a single point
of entry to employability services through the personal advisers
is not enough. People often start their journey towards engagement
towards economic activity in a very small scale way dealing with
the immediate crisis in their life, whether that is around childcare,
debt, parenting issues, and through organisations like us engaging
with lone parents on those issues we can then start to address
issues about self-confidence and returning to some form of training
and then thinking about work often some months into the engagement
with them.
Mr Cairns: I would like to make
a couple of quick points in addition to that. The first one is
that regardless of whether the quality of that one-to-one advice
is currently good, and it will be variable across different organisations,
the fact is it will have to improve because as time goes on and
as we attempt to eat into the stock of workless people in the
city we will inevitably have more success with those who have
fewer problems and as we proceed through this over the next few
years the task will become more difficult and the competence of
the people discharging that task for us will have to improve.
One of the things that we have to address is around how we track
and measure that performance. One of the things we have certainly
talked about in terms of tracking all of this is looking at some
sort of customer satisfaction dimension to it as part of the overall
system, to what extent did someone feel they got the right advice
in the right fashion, which will allow us to try to identify where
things have to improve. That is only one modest element of an
overall process. Personally I do not think it is clear which particular
aspects of the advice service might be deficient, that is something
we have to address, but even when we do that and even when we
have identified that it is good things will have to get better
and will have to become more efficient and more effective because
the task will get harder.
Q8 Miss Begg: As part of that improvement
in delivering the service obviously the Government and the DWP
want a mixed economy of providers from the private, public and
voluntary sectors, each playing to their strengths. This question
is for all of you. What do you see as the strengths of the private
and the voluntary sectors in delivering the employment programmes?
Mr Cairns: The voluntary sector
are here.
Mr Coyne: In the case of the work
which we do with lone parents and their families, the strength
that we bring to it as a voluntary sector organisation is the
breadth of other activity that we do apart from training and employment
related work. We describe it internally as a continuum of engagement
with lone parents and their families which spans support for individual
lone parents, advice on their personal welfare, advice on financial
support for their children, we provide out-of-school care facilities
and pre-five nurseries, and we run a range of personal development
courses, all of which would support those individuals whether
or not they were going into training or education to make their
lives and their families' lives more wholesome and successful.
Through doing that work we develop a relationship of trust and
an understanding of their issues which allow us to tailor specific
training and employment activities to their needs and deliver
them in a way which is sympathetic to their life experience. We
think that relationship of trust and the longevity of the relationship
is fundamental to our success in addressing the needs of that
specific group. It is a relationship which a private sector firm
on a contract simply could not develop, they would not have the
remit or the ability to develop those activities. I am sure the
Wise Group would have a similar view.
Mr Russell: Yes, very similar,
but let me add another point. To some extent it does not really
matter whether you are profit making or not, what matters is the
values that an organisation has. That is what marks out the not-for-profit
organisations from some private sector ones. We are clear that
we have to compete with the private sector, particularly in the
current environment of more work going out to competitive tenders.
We have to compete and we have to act and be as efficient and
effective as any private sector organisation at that stage in
the process. What makes us different is that we have social values
and if we are working with the hardest to help group we will not
ignore clients because they are more difficult and take the easier
ones because that will get the figures up to allow us to hit targets
and therefore make profits. There is a dilemma about that in this
environment at the moment because more and more work goes out
to tender. We are about to start a process of thinking about the
Wise Group's longer term future and this issue will be one of
the core issues we will have to address. If we did become a profit
making organisation it is not profits for individual stakeholders
in the company to achieve or to give bonuses to staff, it is to
reinvest in the activity we are doing because we are only in the
organisation we are in because of the values. It gets to be quite
a complex debate. David is absolutely right that what started
a few years ago was the ability of the voluntary sector to deliver
activity in a different way based on longer-term visions and building
relationships but now we are in a different environment because
of the way contracts are competitively tendered.
Mr Cairns: If I could add one
perspective on this. I was at a reception last night hosted by
Reed in Partnership who are a major significant private sector
provider. They were able to quote some fairly strong statistics
on performance in terms of conversion rates, in terms of clients
into work, the sustainability of clients into those jobs, the
destination jobs being the destinations that clients originally
sought. The challenge and question for us that the public sector
bodies who ultimately will be funding this kind of activity have
to look at is the extent to which different types of interventions
and different types of vehicles for doing that are appropriate
in different situations. It has been said before that what matters
is what works. One of the things we have to try and get to is
a better understanding, not only of the unit cost of these things
but what works best when, what is most appropriate. One of the
interesting things that came out of the presentation from Reed,
for instance, was the typology of the public, private and voluntary
sectors is somewhat artificial. Reed in Partnership's Working
Neighbourhood pilots were all done, as far as I could gather from
their presentation yesterday, in consortia with quasi-public local
development companies in the city, so there was not this great
differentiation between public and private. Clearly the private
sector's performance, whilst it might appear strong, has been
to some greater or lesser extent dependent on the public sector
investing possibly ex ante in some of these processes or alongside
the other activities. Yes, I think there is an argument for a
mixed economy of delivery but there needs to be some very sharp
thinking about where the focus should be.
Q9 Miss Begg: Can I come back to
the blurring of what is private, voluntary or public in a minute.
One of the criticisms we have heard in Glasgow is that one of
the main problems is the plethora of different organisations,
there are huge numbers, duplication and various things. Have you
got any strong empirical evidence that one form of partnership
or one form of organisation is better at getting results? Richard
has said that we have to get better. Is Reed in Partnership streaks
ahead of delivering compared to One Plus, say, or do you find
that the Shaw Trust is so much better? Do you find that there
is good and bad in both sectors?
Mr Cairns: Would that we did know
that and would that it were as simple as that to work out. The
difficulty is we do not have that and I do not think anyone yet
gathers enough of the data to be able to make such definitive
judgments, but we are in the process of trying to do it now. It
is easy for me to say—it sounds almost an apology—that
we do not know yet but we are relatively early in this process.
We are in the process of trying to understand and identify what
works. We have done some work, as yet incomplete I have to say,
in trying to look at the unit costs of different types of outcomes
from different organisations. We are building a much more reliable
picture of what we all buy from different organisations. If the
question is are there too many organisations delivering these
services in the city I think the answer to that is probably yes
instinctively and logically, but when you think about the number
of people who are workless and the range of barriers that they
face, when you take into account the fact that historically this
has been about maintaining service and condition management rather
than about change then we should not be that surprised that there
is a wide diversity of organisations. If we are going to address
this we will probably still require a fairly diverse range of
interventions. How one reduces that to a more rational marketplace,
as it were, is one of the key challenges certainly.
Ms Still: Can I pick up on one
of those points because some of the Glasgow Challenge work that
has been done suggests that a lot of the growth of organisations
delivering on employability are fixed at the point where people
fund it, so it is at the job outcome stage, and yet there is a
lot of work that has to be done in a pathway with individuals
before they get anywhere near that. It is perhaps that there is
duplication or a lot of activity around that because that is what
people fund and perhaps what we need to do is spread the funding
across the pathway. There is a sense that people are hung up on
the into work outcome but, in fact, if someone has been unemployed
for 15 years on Incapacity Benefit they need a whole load of confidence
building steps prior to that to be in a position to go into work.
It is also about rewarding the early intervention work that is
done with individuals.
Q10 Miss Begg: Coming back to the
Wise Group, you said that the DWP programmes are too rigid. What
do you think needs to change?
Mr Russell: I would agree with
Kate, I think what DWP needs to concentrate on is the outcomes
and allow us to sort out the processes and not try and micro-manage
that part of the process. If we have been doing this and we know
our clients and know the communities we are working in, we are
more likely to be able to get a result from that part of it. By
all means make sure that we have a rigorous performance measurement
at the outcome stage. Can I respond to your previous point about
the number of organisations in the city. I think the City Strategy
gives us an opportunity to rethink this, but let us remember that
we are trying to increase significantly the scale of what we all
do to reach the targets set out in the City Strategy. It is not
an easy answer to say that there may be too many organisations,
some of those organisations may have to work better together,
differently, in order that we meet this higher challenge and all
organisations are going to have to increase their capacity if
we are going to reach it.
Q11 Miss Begg: I think my colleagues
have got questions on how these inter-relate. Just looking at
the Wise Group and what you have said this morning already, Laurie.
I have been coming to Glasgow for the last nine years with various
parliamentary committees since I was elected as an MP and have
visited the Wise Group on more than one occasion. I have seen
it develop from essentially an intermediate labour market organisation
for the young unemployed to then dealing with people on Incapacity
Benefit and from what you have said this morning you are looking
at how you will go forward into the future. From what you have
said the separation of what is voluntary or third sector as opposed
to private may be quite blurred inasmuch as just because you are
a non-profit making organisation it does not mean to say you do
not make profit, you just do not have profit for your shareholders
and the profit that you would make would be re-invested in the
organisation. Is that a fair summation of what you are looking
at becoming essentially?
Mr Russell: That is a fair summation.
If we make a surplus, and at the moment it is a very tight surplus,
we re-invest it in the next year's budget. The issue for the bigger
organisations, and at this table essentially we represent them
in the city, is how we build up the internal capacity. For example,
we have had a whole series of audit visits in the last couple
of months. Two years ago we had something like 21 audit visits
in a year from different agencies essentially looking at the same
activity but we had to prepare for them. If we want a team of
finance staff that can understand that and have the systems in
place, et cetera, so we can cover that kind of activity we need
to invest in our own staff. We get no core funding from anybody.
We do not get a budget from any government source local or national
to build up a core team. What we have to do with any contract
is have a contribution to our core staff which essentially are
our backroom staff on finance and development and other activities,
but there are also core staff who might work with our trainees.
At the moment I am looking at how we give financial advice to
trainees and to our low paid staff in the organisation. Yes, we
can use other organisations around in the city but the biggest
issue for our trainees, and we discussed this last night, is the
shift from benefit into work and what financial problems hit them
at that stage. If they get the right advice, often with a wee
bit of flexibility in being able to get some resources for fairly
easy things to get them across the transition into work, then
we know, because we have evidence of this, that we will sustain
people in work, and that is the main reason people opt out early
on. If we want to build up a service like that that has a longer-term
sustainability in terms of keeping people in work then we need
to build up a surplus to have that as a core part of our business.
Q12 Miss Begg: Twenty-one different
audits?
Mr Russell: Yes.
Q13 Miss Begg: Is the City Strategy
going to get rid of that because that is obviously unnecessary
duplication? I have got a question here about the effectiveness
of Employment Zones. They have obviously allowed providers to
be a lot more flexible but do they include all of that checking
and what appears to be cross-checking? It must be an incredible
burden particularly on a small organisation, but on any organisation.
Mr Russell: This is not an issue
particularly for the City Strategy. The auditors come from Europe,
central government sources and funders of individual projects.
It is a much wider issue.
Q14 Miss Begg: So even if the funding
is going to go in one big pot the individual funders are still
going to need to check that money has been disbursed properly?
Mr Cairns: That takes us into
an interesting question around the evolution of City Strategies.
Q15 Miss Begg: I know there is a
question on City Strategies later so maybe we should not go there.
The other thing which you mentioned, David, in terms of One Plus
was that a single point of entry for people is not enough. Obviously
in terms of the initial work-focused interview, who do you think
should be delivering that? Should Jobcentre Plus be the initial
point of contact that merely acts as some kind of clearing house
or signposting to the relevant organisations or should even that
initial interview be done by organisations outwith the public
sector?
Mr Coyne: From our perspective
if the work-focused interview could be delivered by organisations
outside of the Jobcentre Plus set-up we feel in the particular
case of the people we work with that we could do it in a more
rounded way giving better preparation to the individuals prior
to that and also better signposting to them afterwards. We spend
a lot of time preparing people for re-entry into economic activity
and if we could engage more strongly with Jobcentre Plus in the
formal parts of the process we think we could work together to
everyone's advantage.
Q16 Miss Begg: The question in terms
of the new welfare reform is that there will be some element of
sanction for those who do not comply. What is the view of the
voluntary sector here today because we have heard mixed views
from the voluntary sector. Do you think that should be part of
your role in any kind of sanction or do you think the big, bad
person is a role for Jobcentre Plus?
Mr Coyne: I think it would be
very difficult for us to get involved in that. Part of what we
do and the values that underlie our relationship are trust and
about assisting people on their journey, which is not necessarily
just about getting them a job, it is about dealing with a much
wider range of issues. I think it would be impossible for us to
do that properly if we were involved in sanctioning people.
Q17 Miss Begg: So any decision-making
with regard to benefits you think should be left wholly to the
Jobcentres?
Mr Coyne: Yes.
Mr Russell: I think we need to
think this through a bit further and start from that position
but accept that if there is going to be a change we need to think
it through a bit further and look at the pros and cons. At the
moment it looks to me as if there are going to be more disadvantages
in us applying the sanctions. One of the things that we have,
as David said, is the ability to build up trust with the people
we work with because they do not perceive us to be part of the
decision-making process on their benefits. We need to think this
through very carefully.
Q18 Miss Begg: There is still going
to be a role because you are going to have to report somebody
back and say they did not turn up for their interview.
Mr Russell: We will still have
to do that.
Q19 Miss Begg: I presume you have
to do that anyway.
Mr Russell: Our job is to manage
people being absent from courses and quite often take hard decisions
about people who are not suitable for training courses or other
activities. We have an element of that kind of sanction but a
sanction over benefit payment is a stage further and we need to
think it through.
Mr Cairns: If I can add one final
point because I come at this not from the perspective of somebody
who is a provider at all. We know that one of the areas where
we have to do more work in order to move people from various forms
of benefit into employment is earlier engagement and the fact
is, I would imagine, that people will engage around the issues
that are most pressing for them in the first instance. The types
of services that help people deal with those are delivered by
a variety of organisations, I suspect a significant number of
them at least in the voluntary sector. Once one has built that
engagement, built that confidence, built a reliable understanding
of what someone's circumstances are you can then, as I understand
it, start to introduce the question of employability and the question
of employment as an alternative to whatever their current circumstances
are. Therefore, it is as much a question about when one discusses
employment as an option and when one holds what is referred to
as that employability interview, and it is also a question of
how, regardless of who does it, one ensures that the information
that is gathered and the standard to which it is conducted is
to a uniform and high standard. That certainly has to be one of
the aspirations regardless of how we work out by whom and when
it is done. Arguably if one can maintain it to a very specific
standard then it matters less who does it and it allows us potentially
to create some sort of connection between the confidence winning
role that service providers have and then building part of that
bridge into employment. That would be my offer, as it were, to
how one might approach it.
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