Speech by the Rt Hon Iain Duncan Smith, Secretary of State for Work and Pensions.
Thanks to Tim Smith and Government Knowledge for organising, to Mark Fisher and the whole of the Social Justice Directorate at DWP.
It is a pleasure to be here, at an event which brings together so many people in the cause of social justice.
Collectively you have decades of experience and a wealth of expertise in addressing our most pressing social problems…
… vital resources in our mission to transform the lives of Britain’s most disadvantaged individuals and families - those without a foot even on the first rung of the social ladder.
It was enterprises and charities such as the many gathered today which inspired me to establish the Centre for Social Justice (CSJ) back in 2004…
… set up to champion the cause of the most disadvantaged communities and to help grassroots organisations make their voices heard in Government.
Centre for Social Justice
At the CSJ, our starting point was listening to what organisations such as yourselves had to say - through 3,000 hours of public hearings and over 2,000 written submissions, we learnt what worked and what didn’t.
Our findings showed that even in the most dysfunctional and deprived households… in estates blighted by worklessness and dependency… it is possible to turn people’s lives around.
Yet what was also clear was the necessity of tackling the root causes of social breakdown, not just treating the symptoms.
You don’t cure drug dependency by parking addicts on methadone.
You don’t help someone who’s ill by writing them off on benefits and forgetting about them.
You don’t stop spiralling debt by leaving people to the loan sharks.
And you don’t help families by shrugging your shoulders when parental relationships fall apart.
Making a meaningful, sustainable difference to those in poverty means addressing the problem at its source.
I hope this is a principle that all of us here would subscribe to.
And it is important to acknowledge how far the debate has moved on in the last decade or so.
Even in the face of scepticism and doubt, we are now seeing signs that this approach is guiding how the whole of Government delivers social programmes.
A driving ethos
When the Prime Minister invited me to lead the Social Justice Cabinet Committee, it was a real opportunity to take that aspiration and root it in a Government mechanism.
By ranging across different departments, the Cabinet Committee ensures that whether in reform of the welfare system, the education system, the criminal justice system, addiction services, or whatever else…
… Government social policy is collaborative, joined-up and underpinned by a single driving ethos.
It is much to the credit of those working in my Department and others that we have achieved such traction in such a relatively short time.
In March this year, we published the Social Justice strategy - establishing a radical new set of principles for transforming the lives of the most disadvantaged individuals and families.
First, prioritising early intervention, preventing the root causes of disadvantage - whether it be family breakdown, educational failure, worklessness, addiction, or crime.
Second, building and growing a market for a new way of funding social interventions, based on investment in social returns - so that the money follows the outcome, and we pay for what works.
And third, being innovative and locally led, in partnerships with the private and voluntary sectors.
These are the principles at the heart of the social justice agenda.
Today marks another milestone in putting them into practice.
Outcomes not inputs
The launch of the social justice outcomes framework highlights our priorities and sets out a new approach to how we measure our progress.
It is about shining a light on the challenge we face, taking an unflinching look at the outcomes we are achieving, and holding ourselves to account.
For too long, I believe, the success of social programmes has been judged on inputs - with politicians pouring money into projects so they are seen to be doing something…
… and an entire lobbying industry measuring how much a government cares by the amount it spends.
In this high level debate, too few stopped to ask what the results of all this were.
Nothing illustrates this more clearly than the latest child poverty figures.
Despite spending a vast amount of money in the pursuit of halving child poverty, in June we learnt that the last government failed to meet their target.
Notwithstanding some £171 billion spent on tax credits between 2003/04 and 2010… and £90 billion on working age welfare in 2010 alone…
… this strategy did not do enough to transform the lives of the poor, and too many of the root causes of poverty remained unchecked.
Instead of big spending to grab media headlines and placate interest groups in the short term…
… for every pound we should be asking - how does it promote lasting life change?
Social Justice outcomes framework**
Now, drawing on our discussions with the voluntary and community sectors, we have designed a set of outcome measures that will actually track whether our policies are doing just that…
… turning the focus away from inputs…
… and towards the impact that social programmes are having in terms of transforming people’s lives.
The framework is not a set of targets.
Nor an additional burden on providers.
It is about encouraging a cultural shift in how local authorities and government at large deliver services for the most vulnerable - driving programmes that make a real difference.
That starts with the family, the most important building block in a child’s life.
When families are strong and stable, so are children - showing higher levels of wellbeing and more positive outcomes.
But when things go wrong - either through family breakdown or a damaged parental relationship - the impact on a child’s later life can be devastating.
Take the fact that in a survey of offenders, 41% reported witnessing violence in their home as a child.
That’s why we have already invested £30 million in relationship support, to prevent family breakdown rather than waiting to pick up the pieces.
And it’s why we’re working across Government to improve the support available for families who experience abuse at home - more effectively punishing the perpetrator and doing more to educate young people about domestic violence.
The very first indictor in our outcomes framework makes clear that stable, loving families matter.
They matter for this Government, and they matter for the most vulnerable in society.
By measuring the proportion of children living with the same parents from birth and whether their parents report a good quality relationship…
… we are driving home the message that social programmes should promote family stability and avert breakdown.
But if family is the most important building block, school is often the second most important in a child’s life.
All the more shocking then, that schools are failing pupils from the most disadvantaged backgrounds.
By the age of 10, a bright child on free school meals can be overtaken by more advantaged children who showed less promise when they were younger.
From the back of the classroom it is all too often a slippery slope to truancy, and from there to a life of benefits, and in extreme cases, gangs and crime.
More than half of young offenders were permanently excluded from school.
This is a bleak future, and we must end it.
Across Government… from extending free early education to the most disadvantaged two-year-olds, to the pupil premium to ensure poor children get fair access to a decent education…
… we are putting provision in place to ensure that where a child starts out in life does not determine where they end up.
The second and third of our key indicators are about measuring our progress towards this goal - focusing on whether children from disadvantaged backgrounds are attaining the same educational outcomes as their peers, and the percentage of young people falling into a pattern of offending.
In other words, measuring how far we are enabling children and young people to realise their potential.
But as well as preventing people from falling into difficulty in the first place, when people’s lives do go off course we have a duty to offer a way out.
How ironic, then, that the welfare system has often played a part in conditioning people to grow dependent on state support, and treat it as a long-term income stream.
After the recession, some 5 million people claiming out of work benefits, 1 million of them for a decade or more.
This entrenched culture of worklessness and dependency is not only the source of soaring welfare bills…
… more than that, there is a fundamental unfairness in confining people to the margins, leaving them to languish there unseen for years.
This Government will always stand by its promise to protect the most vulnerable and provide support for those whose sickness or disability puts them in difficulty.
But if we are serious about making a sustainable difference to those in poverty, for those who can, we must do all we are able to help them into work - moving from dependence to independence
This belief underpins the whole package of reforms that I am driving in the Department for Work and Pensions.
We are introducing the Universal Credit, a single payment withdrawn at a single rate, so it is always clear to people that work pays more than benefits.
And we are delivering the Work Programme - offering personalised support to get people back into employment and keep them there.
Almost 60% of those who currently claim working-age benefits have been doing so for at least three of the past four years.
By measuring the proportion of those who are capable of work, or moving towards work in future, but have been on benefits for long periods…
… the new outcomes framework will mean we concentrate our efforts on reaching those individuals for whom worklessness has become a way of life.
Tackling multiple problems
This marks a change in the welfare culture in this country, the renewal of a system that acts as a springboard rather than a trap.
Part of social justice is about extending this cultural shift across the whole of Government - doing more to help individuals on a journey to an independent life beyond the state.
Indicators 5 and 6 in the framework prioritise sustainable, full recovery - focusing on outcomes for those in treatment for addiction, and re-offending rates for those who have committed crime…
… recognising that such problems are often linked and overlapping.
Take the example of someone recently released from prison.
Evidence shows that being in employment reduces the risk of re-offending by between a third and a half.
So although those with a criminal record often face difficulties obtaining work, if we are to break the cycle of re-offending it is vital to help them secure a job.
That’s why we have introduced a new provision so ex-offenders can access the Work Programme from day one.
By taking Jobseeker’s Allowance claims in prisons, we ensure that offenders are prepared for the transition from the prison to the community.
They receive immediate support to get them work-ready and find a job - rather than going back to a life of crime.
Payment by results
What’s more, the Work Programme actually incentivises providers to support the hardest to help…
… pioneering the use of payment by results, with the biggest payouts for successfully keeping individuals in work for 2 years.
Because we are paying by results, we will only pay for what works - reducing the risk on the taxpayer and ensuring that every pound of Government money is targeted where it has a positive impact on people’s lives.
Our intention is to see an outcome-based approach extended across Government services…
… as the best way to shift focus towards the delivering meaningful, sustainable results.
Just this month the Prime Minister announced his intention to roll out payment by results across the probation services, making it the norm by 2015.
Back in April we launched 8 national drug and alcohol recovery pilots, paying providers not just for putting addicts through treatment but for the results they achieve in rehabilitating addicts.
In this case, for the outcomes to be sustainable, one thing is absolutely clear - rehabilitation means getting individuals off drugs and alcohol altogether rather than dependent on a substitute.
No one knows this better than Noreen Oliver, whom you will have heard from earlier - an inspirational woman putting this idea into practice.
She and Bac O’Connor have been championing this approach for years…
… but we are now starting to embed the same principle into the benefits, health and justice systems.
Solve that problem - get someone clean…
…get them free of crime…
… get them into work…
…and you help them find a foothold in society again - and stay there.
A payment by results system works best when the ways we measure are relatively straightforward.
But across Government, we are prioritising early intervention - getting to the root of social problems early, rather than waiting to pick up the pieces.
It’s very promising to see other organisations doing the same, and I’d like to welcome the announcement by the Big Lottery Fund today, of new funding for children’s early years.
By improving life chances, we stand to reap the benefits further down the line - alleviating the social problems which so are often more difficult to tackle once they become entrenched.
But because these are dynamic interventions, the impact is trickier to measure and more difficult to forecast.
So if we are to unlock new funding streams it is vital to establish a measurable quality to programmes that deliver over a longer period…
… giving potential investors a better understanding of what the financial outcomes might be.
That is why we’re establishing the Early Intervention Foundation which will provide advice on social finance… assisting local commissioners with their own procurement and evaluation… as well building the evidence base around what works and for whom.
And it’s why we’re testing a variety of cutting edge programmes through our £30 million Innovation Fund, so practitioners can develop a proof of concept - in turn making it easier to access alternative funding streams.
Today, I am pleased to announce the successful bidders in a second round of funding, focused specifically on supporting the most disadvantaged 14 and 15 year olds - those in care, disengaged from school, or involved in gangs, crime and drugs.
These bidders - Prevista, Social Finance and 3SC - join a growing list of organisations bringing together government money in partnership with businesses and charities…
… making the UK a world leader in Social Impact Bonds.
We are making progress in opening up the social investment market - the final piece of our outcomes framework.
You will all have heard of the Peterborough pilot, where social investment is funding charities to run rehabilitation programmes with prisoners.
But from Perth to the Midlands, Merseyside to London, we are channelling private money to help improve the employment prospects of our most disadvantaged young people.
In all cases, investors see a return only if a meaningful outcome is achieved - reoffending falls, more teenagers engage in education - paid for by the Government out of the reduced costs of social breakdown.
The challenge is how to build on these early successes - something I’m sure that the Minister for Civil Society will be talking about in more detail later.
Social investment is worth around £190 million, a number that pales in comparison with the £3.6 billion annual outlay on philanthropic grant funding.
So clearly, there is more to do to grow the market - and now, we have an indicator to measure just that.
Reconnecting the top and bottom
If we can get it right, I believe social investment has huge potential.
Because someone is risking their money on an investment - money that could otherwise be reaping a return elsewhere - it brings a whole new discipline and rigour to how Government delivers social programmes.
But more than that - perhaps most importantly - social investment could be a powerful tool for building a more cohesive society.
The gap between the top and bottom of society is in many cases larger than it has ever been.
We have a group of skilled professionals and wealth creators at the top of society who have little or no connection to those at the bottom.
Yet in so many cases what divides the two is little more than a different start in life.
I believe social investment gives us an opportunity to lock not just the wealth but also the skills of those at the top of society back into our most disadvantaged areas.
Imagine you create a social bond in a particular deprived neighbourhood. Investors buy into it and as with any investment, will want to see it flourish - taking an interest in that community where they would otherwise be totally detached.
At the same time, these wealth creators can have a dramatic effect on the communities themselves…
… showing those at the bottom that they have an opportunity to turn their own lives around and move up the social ladder.
This takes me back the point I made at the very beginning.
At the heart of everything we are doing is a focus on communities and local solutions.
Charities and social enterprises are the true heartbeat of social reform, leading local regeneration, reaching the most marginalised individuals, and challenging us to work with them to resolve society’s most pressing problems.
If we are harness this power, Government’s approach to commissioning support services has a crucial part to play.
I am pleased to announce that the Department for Work and Pensions is actively reviewing its approach to commissioning, looking at how this can support the wider aims of reform and social justice.
Wherever possible, we want to ensure that we pay for results, provide value for money…
… and support a vibrant voluntary and community sector.
Our purpose should be to put in place the mechanisms to restore people…
… enabling those trapped on the margins to take control of their lives, and giving them hope and aspiration for their future and their children’s futures.
You told us what you needed to achieve that kind of life change.
And although we’re not there yet, we are pushing hard to put the right structures in place and remove the barriers that hinder your work.
Now is not the time to slow the pace of reform, and we must work collaboratively across and beyond Government to push harder and do more.
For those people who feel trapped, dependent on a broken society, there is no time to waste.
For their sake we must change the ethos of government, from one obsessed with inputs…
… to one concerned about outcomes…
… having the courage to be open and honest about whether those outcomes are being achieved.