1 Introduction
1. Over recent years the Department has seen
an increasing number of its employment programmes delivered through
contracts with the private and third sectors. The Department
published a revised Commissioning Strategy for employment programmes
on 28 February 2008; the Flexible New Deal was the first programme
to be commissioned under the new strategy. The strategy aims to
create a strong market structure in which 80% of the Department's
business is conducted with a "stable core of reliable providers"
led by prime contractors at regional and subregional level.[1]
The Department expects smaller providers to remain important but
they will be subcontracted by a consistent base of top tier prime
contractors who must adhere to a Code of Conduct (which outlines
best practice in the treatment of sub-contractors throughout the
Department's supply chain). Performance will be measured on the
basis of both short and sustained job outcomes, with an initial
measure of sustainability of six months but looking to build in
incentives for up to 18 months. Provision will be externally assessed
using existing arrangements with Ofsted in England) and Estyn
in Wales and (from January 2010) Her Majesty's Inspector of Education
will inspect providers in Scotland. Contracts will be longer and
larger than they have been in the past "to enable long term
planning and investment".[2]
2. The Committee carried out an inquiry into
DWP's Commissioning Strategy and the Flexible New Deal in early
2009.[3] The aim of this
inquiry was not to repeat that inquiry; instead it aimed to look
at issues that had come to light, or changed since the 2009 report.
Primarily these were the prevention of fraud, the treatment of
subcontractors, and ensuring fair treatment of customers, including
vulnerable groups. Our previous inquiry endorsed the "black
box" approach, under which the Department does not prescribe
how providers help customers move into work, but rewards them
when they do.[4] However
the "black box" applies only to how customers are helped
by providers; it never applied to auditing or to the treatment
of subcontractors. The Department has also specified in the Commissioning
Strategy that its assurance processes would ensure that the hardest
to help were offered a good service by providers.[5]
3. The terms of reference of this inquiry were
wider than our previous one, in that they included all contracted
employment programmes, including Employment Zones, Pathways to
Work, the New Deal for Disabled People, the New Deal for Young
People, Prime Contractor New Deal, and the Work Choice Programme
(which is still out to tender) as well as Flexible New Deal. These
programmes have many differences in the way they are commissioned,
paid for, and delivered. Some of our conclusions are generic,
and others apply to specific programmes.
4. The Committee invited witnesses to submit
written evidence on 13 July 2009. We received memoranda from 15
organisations: the Papworth Trust, the Wise Group, RNIB, the
Shaw Trust, Working Links, PCS, A4e, City Strategy Pathfinders
Learning Network, The National Autistic Society, Reed in Partnership,
the Association of Learning Providers, the Employment Related
Services Association, Department for Work and Pensions, Ingeus
Centre, and the British Association for Supported Employment.
5. On 30 November 2009, the Committee held its
first evidence session with Huw Davies, the British Association
for Supported Employment; Rob Murdoch, Chair, the Employment Related
Service Association (ERSA) and Executive Director, A4e; and Matthew
Lester, Vice Chair, ERSA and Director of Operations, the Papworth
Trust. The second evidence session with the Minister for Welfare
Reform and Employment, Rt Hon Jim Knight MP took place on 16 December
2009.
6. As part of the inquiry, the Committee also
undertook a visit to Glasgow. A report of this visit is contained
in the Annex to this report. We are very grateful to Royal Strathclyde
Blindcraft Industries, Glasgow Works, Partick Jobcentre and DWP
for facilitating our visit, and to all those who took time to
meet us.
7. We would also like to thank Dan Finn, Professor
of Social Inclusion at the University of Portsmouth, for assisting
us as Specialist Advisor during the inquiry.[6]
We very much appreciate the contribution he made to our work.
1 DWP, Commissioning Strategy, February 2008, p 10 Back
2
DWP, Commissioning Strategy, February 2008 Annex 1, p 32 Back
3
DWP's Commissioning Strategy and the Flexible New Deal, Second
Report of the Session 2008-09 Back
4
DWP's Commissioning Strategy and the Flexible New Deal, Second
Report of the Session 2008-09 para 49 Back
5
DWP, Commissioning Strategy, February 2008, p 22 Back
6
The Committee formally noted that he had declared interests as Associate
Director (Research) with the Centre for Economic and Social Inclusion-at its meeting on Wednesday 8 July. Formal minutes of the Committee are available at
http://www.parliament.uk/parliamentary_committees/work_and_pensions_committee/wapfmhomepage.cfm Back
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