Monitoring to ensure 'integrity' of contracts

Flexible New Deal scheme subcontracts must be fair to voluntary organisations, says employment minister

Prime contractors that drop voluntary sector subcontractors without good reason could face sanctions under the Department for Work and Pensions' new commissioning model for delivering its Flexible New Deal programme.

Five-year contracts for the programme, which will deliver employment training and counselling services to those farthest from the labour market from next year, will be offered to single organisations, likely to be private companies. These organisations will then subcontract aspects of their contracts to other companies and third sector organisations (Third Sector, 18 June).

Tony McNulty, minister of state for employment and welfare reform, told the Work and Pensions Select Committee in Westminster yesterday that the performance of prime contractors would be regularly monitored on matters including how they worked with voluntary sector subcontractors. Performance improvement plans would be agreed with failing contractors, he said.

"The integrity of the supply chain is hugely important to us," he said. "I find it difficult to see how everything could be delivered without the sector."

He also promised the DWP would work with the Office of the Third Sector and prime contractors to make sure the voluntary sector did not lose out under the new arrangements and understood the risks of getting involved in supply chains.

He said current DWP contracting arrangements with the sector, with 573 organisations delivering 1,364 contracts, were inefficient and had not always yielded good results.

"It is not a sustainable model and won't give us the flexibility and personalisation that lies behind our commissioning strategy," he said. "We have never got to the stage where contractors are doing things in the way we most like to do them."

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