The Work Programme: View from the grass roots

Charities give their feedback on the terms and conditions of the government's scheme aimed at getting the long-term unemployed back into work

Pauline Kimantas, local commissioning and procurement unit manager, Navca
Pauline Kimantas, local commissioning and procurement unit manager, Navca

Pauline Kimantas has heard of charities that have been offered acceptable contracts under the Work Programme and charities that have been offered bad contracts. "But I'm not sure I've heard of any charities being offered good contracts," she says.

Kimantas, the local commissioning and procurement unit manager at the community infrastructure organisation Navca, says many charities have walked away from negotiations because the terms were too poor to allow a profit.

But many have felt backed into a corner, she says, either because their sole purpose is to help people back into work or because they have no other way of raising funds - as a result, they have chosen to put up with a bad deal.

"Chris Grayling has told charities that if the deal isn't very good they should walk away," she says. "That's all very well, but what if there's nowhere to walk to? For some charities, it's a large part of what they do. It's got implications for the future of the organisation."

Kimantas believes that charities have also suffered because they are competing among themselves for work and lack collective bargaining power: "Contractors are saying 'there's someone else down the road who's able to do it cheaper', and charities have been forced to take the price on offer."

She says that the list of charitable subcontractors published by the government includes some that are not guaranteed any work.

But one thing that will help in the future, Kimantas says, is the Merlin Standard - a document approved by the Department for Work and Pensions that will govern how subcontractors are treated by prime contractors.

One of its requirements is "equitable risk transfer, including financial risk, for small, specialist and third sector providers". Another is that funding arrangements must be fair and proportionate, and avoid causing undue risk for supply chain partners.

However, Kimantas says the Merlin Standard is not yet strong enough. "It will be a powerful tool in the future," she says. "It clearly outlines the standards that prime contractors must adhere to, and it will be assessed using feedback from organisations in the supply chain.

"But it takes a while to get something like this up and running, and it hasn't come in quickly enough to help charities involved in the current round."


 

CASE STUDY - The subcontractor

Volunteer Cornwall, a volunteer support organisation with 50 staff and a turnover of about £2.5m a year, will lose either six or seven of its eight staff working on welfare-to-work schemes because of the move to the Work Programme, says Martyn Alvey, operations and contracts manager at the charity.

He says his organisation has had welfare-to-work programme contracts for 10 years, but engaging with the Work Programme has involved an immense amount of work - it had no way of knowing which prime contractors might succeed in their bids in Cornwall, so it had to approach 15 organisations.

"If they had asked the same questions it wouldn't have been as bad," he says. "A lot of organisations didn't bid because they found it too much work."

In the end, Volunteer Cornwall was included in the bids of two successful primes, but has not found a lot of work. "One company has been very good and sponsored a post within our organisation," he says. "The other has us on its framework, but has not guaranteed us any work."

Alvey predicts that prime contractors will try to provide support for hard-to-reach groups, in the way that charities do, but in many cases will fail.

"When they realise it's not worked out as they'd like and they need to get small third sector organisations involved again, a lot of them won't be here," he says. "The capacity will be lost."


 

CASE STUDY - The umbrella group

The Papworth Trust, which helps disabled people back into work, has two 'tier one' contracts under the Work Programme - and it turned down others, according to Matthew Lester, its director of operations.

Lester, who recently became chair of the Employment Related Services Association, the national body for major welfare-to-work providers, thinks the Work Programme is proceeding well.

The Papworth Trust"I think some of the criticism of the relationship between primes and subcontractors in the past has been well founded," he says. "I think that unhappiness among subcontractors wasn't confined to the voluntary sector."

This time, he says, relationships have worked better. "There have been reasons why some bids haven't worked out," he says, "But we've been able to develop successful relationships too.

"For us, the key aim of contracting work is to make a profit to fund the charitable work. We're passionate about doing that work, but we have to be realistic about our contracting relationships."

He says that many years ago the welfare-to-work market was fragmented, and the government has gradually turned it into a business, which has adversely affected some organisations.

"If the service that remains provides a good outcome, that's all that matters," he says. "Whether it does it with a charitable structure or not isn't important." In the end, he says, charities deserve to lose the business if they cannot provide the best service.

Read interview with employment minister Chris Grayling

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