Press release

Work Programme – competitive market delivering constant improvement

This news article was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Nearly half a million people have been helped into jobs through the Work Programme and new measures will continue to improve the scheme.

New measures to ensure the Work Programme continues to help more long-term unemployed back to work will see a new organisation brought in to run the scheme in one area.

This comes as industry figures published today show that nearly half a million people have been helped into jobs through the Work Programme.

The Work Programme gives tailored support for people at risk of becoming long-term unemployed as part of the government’s economic plan to help people into employment. Performance has dramatically improved since it was introduced in June 2011.

In order to continue this improvement, the bottom quarter of contracts have been told to put forward plans for how they intend to boost their performance. This is so they can deliver a better service for claimants, competing at the level of those contracts doing best at getting the long-term unemployed into work.

In addition, the contract in north east Yorkshire and the Humber, currently run by the Newcastle College Group will be terminated with 12 months’ notice. This was the lowest performing contract when assessed against a range of performance measures. Over the next few months we will be conducting a procurement competition to identify a replacement provider.

Employment Minister Esther McVey said:

Work Programme performance has improved dramatically – hundreds of thousands of people have escaped long-term unemployment and been helped into a job as part of the government’s long-term plan to create a stronger, more secure economy. Now we want to take this to the next level by driving up performance even more.

The competitive market we have created means that providers need to constantly improve. This means good value for taxpayers and, more importantly, supporting as many people as possible off benefits and into a job so they can turn their lives around and have the security of a regular wage.

The Work Programme has overhauled how the very hardest to help people are supported off benefits and into work by providing personalised support for people who are at risk of becoming long-term unemployed. Service providers have the freedom to design innovative programmes of support depending on the individual needs of each claimant, while meeting robust standards set by DWP for delivering the service.

The Work Programme also gives value for money for the taxpayer by basing payments to providers largely on results they achieve. As part of the scheme’s competitive market share shift mechanism, in August last year DWP started moving claimants from lower performing providers to higher performing ones in their area, as an incentive for providers to continually drive up their performance.

The bottom quarter of contracts that have been put on an enhanced management regime will need to put to DWP a comprehensive 6 month improvement plan, which will be closely monitored at key milestones. Those plans will be expected to set out the realistic extra investment or measures they are putting in place to ensure they deliver for the long-term unemployed claimants in their area.

For the Newcastle College Group contract that is to be put out to tender again, transitional arrangements will be implemented over the next 12 months to ensure that claimants are provided with a smooth changeover to a new provider.

As part of the continuous development of the Work Programme, in April 2013 the Building Best Practice group was set up to help providers improve the support they offer claimants. The group will make final recommendations in the spring. However, ministers have already begun implementing early recommendations, including building the capability of the voluntary and community sector, so the huge potential of this sector can be better harnessed to support some of the very hardest to help back to work.

More about the Work Programme

The Work Programme is based on payment by results. Providers get a small attachment fee when a jobseeker joins them, but only get the majority of their payment when they have helped someone into work for 6 months (or 3 months for the very hardest to help). Providers then get sustainment payments when they keep someone in work past the 6 month point.

Official figures, published in December 2013, show Work Programme performance has improved since being launched in June 2011 – see Work Programme statistics December 2013. Up until the end of September 2012, just under 55,000 had found lasting work. This has almost quadrupled to 208,000 people by September 2013.

Today the department has issued a notice of termination to Newcastle College Group in respect of their contract for the provision of Work Programme services in north east Yorkshire and the Humber. The notice of termination has been issued under the voluntary break clause in the contract and not for any breach of contract by Newcastle College Group.

Over the next few months we will be conducting a procurement competition to identify a replacement provider to provide Work Programme services in north east Yorkshire and the Humber. We will rigorously assess bids to determine who can deliver the quality of service and results we require for the people of north east Yorkshire and the Humber in the quickest and most efficient manner.

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