House of Commons - Public Accounts

Select Committee on Public Accounts Minutes of Evidence

Supplementary memorandum submitted by the Ministry of Defence

Question 27 (Dr John Pugh): How many people have not benefited "in an employment sense" from going through the Army [Military]?

As noted at the hearing it is difficult to be precise about the percentage of Service leavers who do not benefit in any employment sense from their military service. The NAO Report cites that only 18% of Service leavers surveyed stated that their military service had not helped them in gaining subsequent employment. The most recent statistics we have available show that 95% of Service leavers accessing the Career Transition Partnership programmes who wish to work are in employment six months after discharge, and only 14% of Early Service leavers are still claiming Job Seekers Allowance at the same point. It is true that levels of unemployment are higher amongst Early Service Leavers, who comprise 37% of the total annual outflow, than other leavers. However, the Committee will recall that 59% of Early Service Leavers are discharged from training establishments before completing their initial military training, of which 75% are from the Army. They are therefore predominantly young and have not had the time to take advantage of the significant opportunities during productive military service either to improve their educational qualifications or to acquire the competencies and professional qualifications that will make them more attractive to prospective civilian employers on discharge. For these individuals it would not in our view be reasonable to lay responsibility for lack of success in the wider employment market at the door of the Department. By signposting them to Jobcentres and actively encouraging engagement in DWP New Deal and Connexions programmes, the Department provides, to those who do not, in the event, enter a productive military career, a level of support not normally offered by other employers.

In respect of educational improvement, the Armed Forces' record is impressive, as shown in the table below, which is drawn from the NAO's survey of recent leavers.

Highest level of academic qualification on entry to Service Highest level of academic qualification on exit from Service

None 11% 11%

NVQ 1 & 2 5% 21%

GCSE 57% 15%

A levels/NVQ3 17% 22%

1st Degree/NVQ4 8% 24%

Masters/Doctorate 1% 7%

The numbers of Service personnel raising their best academic attainment level from GCSE to A level or better is particularly striking. Moreover, the same survey revealed that only 4% of recruits have professional qualifications compared to 28% of Service leavers. We have done no substantive analysis on the 11% who enter and leave with no qualifications but the likelihood is that there is a close correlation with much of the compulsory discharge outflow from initial training.

The NAO's survey of recent Service leavers also showed that 12% of respondents were living with their relatives. Of these 72% were under 25 years old and 21% were aged between 26 and 35: 53% fell under the definition of Early Service Leavers. However, accommodation arrangements are not of themselves an indicator of employment disadvantage because the survey showed that 51% of those living with relatives had full time jobs and only 16.5% were unemployed but seeking work: of the latter 58% were Early Service Leavers.

Questions 67-72 (Mr Ian Davidson): An update on Service leaver unemployment levels

The NAO Report stated that 94% of leavers who accessed Career Transition Partnership (CPT) programmes who wish to work are in employment six months after discharge; and the NAO's survey of recent Service leavers noted 16% of Early Service Leavers were unemployed and seeking work. Subsequent data for the last full six months that we have available (September 2006—March 2007 inclusive) show that 95% of leavers who accessed CTP programmes who wish to work are in employment six months after discharge and that among Early Service Leavers the percentage who were unemployed and seeking work at the same review point (ie six months post-discharge) was 14%. In both cases, the figures reflect an improvement on the figures found by the NAO and therefore the conclusion must be that the level of unemployment among all Service leavers who wish to work has declined notwithstanding a tightening national labour market.

Most Early Service Leavers are discharged before completing their basic military training and are thus under 25 years old and predominantly male. The 14% unemployment rate among Early Service Leavers is broadly comparable with the national unemployment rate among males under 25 prevailing at the time the Department's survey of such leavers was undertaken. However, the national rate reflects the entire spectrum of employability from the highly academically and professionally qualified to those with very few qualifications and poor basic skills, whereas the majority of Early Service Leavers discharged from training schools do not achieve the standard of performance needed to enter productive military service. It could be inferred that even amongst those Early Service Leavers who discharge under such circumstances, for some their very brief time in uniform in an ordered environment that seeks to instil a sense of self-worth and self-discipline has conferred some advantage in the wider employment market compared with their civilian analogues.

Questions 72-76 (Mr Davidson): Some external providers are setting their charges according to the money available. Can we have a list of those companies?

There are many hundreds of providers of vocational and management training within the United Kingdom from whom Service leavers can purchase courses and it is impossible to police them all. The Department has no legal authority to challenge a provider's charges, unless there is clear evidence of malpractice arising from a Service leaver complaint. The Department actively investigates companies against which complaints are made, suspending those that may be on the CTP Preferred Supplier List (PSL) until issues are resolved. Over the past six years, 54 complaints have been received about companies on the PSL: there were only four last year, of which one resulted in the removal of MET UK from the PSL.

Examples of companies the Department has investigated in the recent past about possible inappropriate accommodation and questionable charging include: Trade Skills Training, Stevand Training Services, Weston Transport Training Services, Step to Training and MET UK. The outcomes were these; Step to Training have amended their accommodation billing practices but remain not recommended by the Department pending assessment of the company for inclusion on the Preferred Supplier List. Trades Skills Training refunded a Service leaver. Stevand Training Services was removed from the PSL and shortly afterwards ceased trading. Weston Transport Training Services was also removed from the PSL and, exceptionally, because of the company's refusal to cooperate with investigations, CTP Career Consultants and single Service Service Resettlement Advisors were directed not to authorise training from the company. No action was necessary in relation to MET UK.

There are a few companies on the PSL who levy accommodation and food charges on Service leavers attending residential courses that approach the maximum allowances that can be drawn down. These include: Mike Watts Fine Woodworking Courses, Perpetuity Training (a physical security and contingency management training provider), PS Ridgeway Ltd (transportation and specialist cargo handling), Systems Communications and Networks SCN Ltd (predominantly IT and telecommunications network engineering) and You Train (a software engineering trainer). In all bar one of these training providers, which is subject to investigation, the majority of their courses exceed the level of the IRTC grant by a substantial margin. None of this necessarily means that the providers were setting their charges according to the money available, but the information may be helpful as a general comparison between the level of charges and the amount of the grant.

To mitigate the risk of excessive public expenditure on accommodation and meals arising from resettlement vocational and management training courses, the Department's policy is to maximise the availability and use of quality training available to Service leavers that is within daily commuting distance from major concentrations of Service personnel or located near available Service accommodation, either through the CTP contractor or from accredited providers on the PSL.. A significant development in the past 6 months is that all PSL providers are required to disclose their course costs, including residential costs, on the CTP training course website

Question 91 (Mr Ian Davidson): An update on the numbers of Service leavers made aware of SPACES

The NAO Report notes that of the single respondents to their survey of recent Service leavers, only 13% who did not own a house prior to discharge stated that they had been made aware of the assistance provided by the Single Persons Accommodation Centre for Ex-Service Personnel (SPACES). The Department at present has no figures on the current level of awareness although it has made considerable improvements in the structured manner in which SPACES support is brought to the attention of those Service leavers who might need it. The recently introduced feedback mechanism for Early Service Leavers on the quality of their resettlement provision and the annual survey of Early Service Leavers resettlement outcomes should provide evidence of the effectiveness of the new measures we have put in place.

The briefing presentation that is delivered to all Early Service Leavers has been revised to include specific mention of the accommodation support SPACES will provide and details of how to contact the organisation. This is reinforced by officers conducting the mandatory one-to-one resettlement interviews with Early Service Leavers, who are now required to probe more deeply into the post-accommodation plans of leavers. If individuals are assessed as vulnerable to homelessness or returning to less that satisfactory family circumstances, the interviewing officer is required to again signpost the services available from SPACES and how to contact the organisation. If appropriate, the interviewing officer will offer to get in touch with SPACES at the individual's request. As a fallback, the resettlement presentation to Early Service Leavers also advertises the location, dates and times of the regular Joint Service Housing Advice Office regional housing briefs, in which the role of SPACES, the services offered and contact details is outlined.

Since the end of January 2008, it has been mandatory for all Service leavers whose transition is not managed under the Early Service Leaver scheme to attend a resettlement interview with a regional resettlement advisor: before this date, attendance of resettlement interviews by officers was discretionary. The interview covers a wide range of resettlement matters including housing. The resettlement advisor is required to bring to the attention of the Service leaver the location, dates and times of the regular Joint Service Housing Advice Office regional housing briefs and, in the case of single personnel who do not own their own home, SPACES.

At the end of the mandatory resettlement interview, all Service leavers are required to sign a document stating that they have received and understood the information listed in the briefing schedule: this includes housing information.

Execution of the revised regime will be actively policed in the Army, in which the NAO report identifies some unevenness in the delivery of resettlement services at unit level, with routine audit of performance by specialist Army Training and Education Service staffs outwith the Chain of Command. Provided all the actions outlined above are discharged, it is difficult to see what more can be done to inculcate awareness in Service leavers of SPACES and encourage those with identified accommodation needs to use its services. That said, the Army resettlement communications strategy implemented with effect from the end of February 2008 ensures that all Service leavers are provided with explicit guidance on their resettlement entitlement and the Army Service leavers handbook, which from January 2008 is issued to all Army Service leavers, includes a section on accommodation issues with particular reference to SPACES.

Clearly, however, we cannot compel individuals to use SPACES if they choose not to do so.

Question 95 (Mr Ian Davidson): In paragraph 3.21, there is the point about a small number of local authorities that are behaving badly. Can you name them?

Question 103 (Mr Austin Mitchell): We would like a list of these few local authorities which are behaving in that kind of fashion so they can be named and shamed. It is disgraceful

There are two issues identified in the report:

— "concerns that a small number of local authorities may be seeking to delay accepting a main homelessness duty towards Service Leavers and their families who meet the statutory homelessness criteria, and are requiring them to remain in their Service accommodation beyond their last day of service."

— "additional concerns that a small number of local authorities are delaying acceptance of the main homelessness duty until the courts grant an order for possession to Defence Estates although this does not appear to be widespread."

Having considered this, as we undertook at the hearing, in consultation with DCLG, MOD's view and that of DCLG is that it would not be appropriate to publish the names of the local authorities involved. Neither MoD nor DCLG has, in the past, collected information on local authorities which adopt these practices. The NAO, which came across examples in the course of its fieldwork, recognises that they are anecdotal. It is understood that the local authorities concerned were not given an opportunity to comment on the reliability of the accounts given to the NAO.

MoD has accepted the NAO's recommendation that it should seek to obtain a better idea of the scale of the problem (as well as working with DCLG to minimise the number of cases in the future). Currently, our IT systems only give figures for the overall level of evictions from MoD property for all reasons, of which local authority insistence on a Possession Order is only one. These show that in Financial Year 2005-06 there were 68 evictions; in 2006-07 there were 104; and in 2007-08 there were 58 up to 18 February 2008. IT systems are now being modified so that, in addition to recording that a Possession Order has been sought in certain cases, they also hold data on why this action has become necessary. From the middle of 2008, therefore, we will start to acquire more reliable data about any cases where local authorities are failing to follow DCLG's guidance in this matter.

Question 116 (Mr Austin Mitchell): How many Service personnel had been helped into house ownership by shared equity schemes. Shared equity, which makes house purchase more affordable by allowing the purchaser to acquire only a proportion of the equity at the outset, is a valuable addition to the range of schemes for getting on to the property ladder

Both government and commercially-funded shared equity schemes are available to Service personnel. Those who have a household income of less than £60K will qualify for the Department of Communities and Local Government (DCLG) run schemes, whereas there is no income ceiling for the commercial scheme as currently offered. Details are as follows:

DCLG New Build Homebuy:

DCLG Open Market Homebuy:

(i) 17.5% Government equity loan (maximum £50K).

(ii) 12.5% Government equity loan + 12.5 % Participating Lenders.

(iii) 17.5% Government equity loan + 15% Yorkshire Bank.

English Partnerships—First Time Buyers Initiative:

Commercial Scheme:

The following table shows the number of personnel who had completed purchases under these schemes, from their start dates up to 29 February 2008. It does not take account of those who may have applied to the schemes but not yet reached completion.

Scheme Start Date Completions

DCLG Homebuy Schemes (Includes New Build and Open Market Homebuy) September 2006 access to Key Worker Living Programme (KWLP) New Build. Expanded eligibility to include Open Market Homebuy to all regions December 2007 30

Shared Equity Services June 2006 62

English Partnership First Time Buyers Initiative September 2006 as part of the KWLP.Expanded eligibility to all regions December 2007 5

Question 131 (Mr Richard Bacon): I would like to move on to the issue of mental health for people who have left the services. The Defence Select Committee Chairman this morning praised the treatment of battle field injuries but went on to say that they had concerns about mental health. You described the approach as one of enhanced support for GPs and enhanced support for those who may need help later. How much do you spend on that?

The MoD and four UK Health Departments are working together in setting up six pilots in the UK to trial a new community-based expert veterans' mental health service. It is intended that this service will be trialled for two years following which we hope to roll it out UK-wide. The MoD will provide start up costs for the six pilot sites and will meet the costs of the evaluation. The total cost of the project to MoD is £500,000 though additional funding has been contributed by the Scottish and Welsh Governments and a number of the Primary Care Trusts involved have committed additional resources to the pilots. A key aim of the aims is to improve NHS understanding of both the scale of the requirement for an expert veterans' mental health service and the nature of veterans' mental health needs.

For veterans not in a pilot area, the MoD's Medical Assessment Programme (MAP) based at St Thomas's Hospital, London, offers expert mental health assessments to veterans who served in operations since 1982 and who are concerned that their health has been adversely affected by service. Assessments are undertaken by a former ex-Service medical officer who is a qualified GP and consultant psychiatrist. The cost of this service is some £200,000 per annum but it is also available to serving personnel and a small number of those attending are assessed for a general health problem that they are concerned may be linked to service.

Additionally the MoD set up The Reserves Mental Health Programme in November 2006. This offers a dedicated mental health assessment by the Defence Medical Services for any member of the Reserve Forces demobilised since January 2003 following deployment overseas. In the event that individuals are assessed as having a combat-related mental health condition, they are offered outpatient treatment by the Defence Medical Services, who have particular expertise in this area. The Programme is based at the Reserves Training and Mobilisation Centre at Chilwell in Nottinghamshire. Costs for the first year, including those for infrastructure, IT and staff, were £743,243.

Question 132 (Mr Richard Bacon): How much do you spend on radio advertising for veterans who may need your help? Do you know if you spend any? I hear ads for people who are looking for a job, who have been out of work for a long time, who need to reskill and maybe have problems with literacy and numeracy. I hear ads for reporting benefit cheats, so it is something the government does. I have never heard a radio ad that says, "You have served this country. You have done something that nobody else does and you have watched your best friend die in front of you with his head blown off, rolling across the ground near your feet". Something the media are very bad at making clear is what really these people go through. "You may need some help. We are here to help. Phone this number." Has there ever been a radio ad like that or something like that?

The MoD has commissioned Veterans Day advertising on local BBC radio stations through Community Services Volunteers; this included advertising of services for veterans; £23,000 was spent on a campaign linked to Veterans Day 2007 and a further programme of advertising is being commissioned for Veterans Day 2008; there will also be TV advertising. We also advertise the services we offer to veterans, including the free-phone Veterans Helpline and Veterans-UK website, regionally in newspapers, telephone directories and on public transport; the total spent in such advertising over the past three years is approximately £170,000. In addition, it is a condition of the £350,000 grants made available by the Department for Veterans Day events across the country that they should publicise the support services available to Veterans; this is monitored to confirm effective delivery. The Government additionally publicises and provides access to the services it offers at major public events where a substantial veterans' attendance may be expected; it does this through Service Personnel and Veterans Agency caravans, manned by members of the Veterans Welfare Service. We also publicise other Government and charitable services available to veterans, including the Government's mental health pilots, the Medical Assessment Programme at St Thomas' Hospital London and the Reserves Mental Health Programme; we do not have figure for the cost of this material. Finally, Ministers regularly take the opportunity of radio and TV interviews to publicise the services offered to veterans.

Question 151 (Mr Alan Williams): What is the additional cost of raising the level of the Individual Resettlement Training Cost (IRTC) grant to £1000; and the costs avoided by the Department by not increasing its value from £534 since it was introduced in 1993?

The Department has a target to increase the value of the IRTC grant from £534 to £1018 with effect from October 2008 and, thereafter, to sustain its value annually in line with inflation. We will be seeking to resource the increase by reducing the amount currently spent on travel and subsistence by Service leavers attending resettlement vocational training by delivering more quality training courses, local to more Service leavers, so such costs are avoided. As the NAO report observed, Service leavers annually spend over £9.5 million in subsistence costs associated with individual resettlement preparation. The increase in funding needed in the first full year of the IRTC grant uplift is assessed to be in the order of £6.524 million, assuming all personnel entitled to the grant use the full amount. In practice the outturn is likely to be lower because Service leavers attending contract-funded courses provided by the Career Transition Partnership (CTP) are not hard charged but have their IRTC grant "account" debited by one twentieth for each day of training provided. At this stage it would be difficult to provide a figure for the abatement in IRTC grant outturn, not least because for some of the more expensive training we might provide under a contract, building on experience with the Royal Irish (Home Service) bespoke local training package, might require a higher per diem IRTC grant soft charge on Service leavers: an expectation of at least £0.5 million would not be unreasonable.

An assessment of the costs avoided by the Department in not increasing the IRTC grant since its inception in 1993 is more problematic because the Department has an incomplete record of expenditure due to the way that the single Services construct and manage their budgets in line with their wider organisational structures. In the case of the RAF, no centralised records are available because the Service disaggregates provision to Air Station level as part of the wider training budget. Significant restructuring of the single Service since 1993 compounds the difficulty of an audit trail. Accurate data on historic IRTC grant expenditure could only be provided at disproportionate cost although, with effect from 1 April 2008, the single Services will be maintaining a record of their outline resettlement costs.



© Parliamentary copyright 2008	Prepared 18 July 2008