Twenty-two of the 24 lead providers of Flexible New Deal, the Labour government’s welfare-to-work scheme, would have failed to meet the targets being set by the government for Work Programme providers, according to a think tank report.
Will the Work Programme Work? was published yesterday by the Social Market Foundation. It says the Department for Work and Pensions’ performance targets are "unreachable" and this could lead to the failure of the programme.
The programme’s measure of success is that 5.5 per cent of people placed on the scheme in the first year find work, rising to 27.5 per cent in the second year and 33 per cent in the third.
The report says the proportions, based on experience of the FND, are likely to be 4.1, 20.5 and 27.8. It concludes that 22 of the 24 FND providers would fail to reach the minimum targets set for programme providers over the first three years.
Ian Mulheirn, director of the SMF, said the figures in the think tank’s report had been adjusted to take into account the variations between the two welfare-to-work programmes, and only applied to adult long-term Jobseekers’ Allowance claimants.
He said this allowed the figures to be compared on a fair basis.
"Past experience suggests these targets are not going to be attainable," he said. "It is not clear why the DWP thinks Work Programme providers will achieve results that are so much better than were achieved under the Flexible New Deal."
He said the government had warned that it would terminate the contracts of providers that could not deliver the minimum levels. "This threatens to create huge instability in the programme," he said.
In a statement, Chris Grayling, the Employment Minister, said: "The providers are investing £500m of their own money into the Work Programme this year alone, and they wouldn’t be doing that unless they were confident of making a real difference in getting people into sustainable employment and achieving results."
Of 1,099 subcontractors involved in the scheme, 508 are from the voluntary sector, according to the DWP.