Allister Hayman,
Regeneration & Renewal,
22 June 2009
The Government's first flagship scheme to pay jobs brokers by their results in finding work for the long-term unemployed is running 70 per cent short of its target.
The Pathways to Work (PtW) programme, the first major scheme to be launched under the Department for Work and Pensions' (DWP) new "payment-by-results" commissioning strategy, is aimed at cutting the UK's 2.6 million incapacity benefit claimant count.
But official performance results, obtained by Regeneration & Renewal from the DWP after a Freedom of Information request, show that between April 2008, when PtW began, and the end of February 2009, PtW brokers only got 30 per cent of their target number of clients into "sustained jobs" of at least 13 weeks' duration.
Rather than providing 73,000 "sustained" job entries, at its current rate of progress, PtW is set to deliver only 22,000 jobs over its first year, the data shows.
From October, the Flexible New Deal (FND) will see brokers paid by their results in getting all long-term unemployed people into work, not just those on sickness benefit.
Despite the recession, work secretary Yvette Cooper, who last week launched the second phase of the FND (see Funding and Finance, p5), still expects FND brokers to get 55 per cent of their entrants into jobs lasting at least 13 weeks and 50 per cent into jobs lasting at least 26 weeks, targets that many in the sector think unattainable. The PtW target is 45 per cent.
Senior figures in the sector said a culture of "over promise and underperformance" had led to many PtW providers losing money. They also warned that, over the course of the five-to-seven year FND contracts, some brokers could get into financial difficulties, forcing the DWP to either bail them out or let them go bust.
A DWP spokeswoman said that, if FND brokers ran into difficulties, the department would "work closely with them to ensure continuity of supply", and added that it could always change service provider.
