It has taken some time, but the media has now worked out that the government’s
back-to-work reforms are a story which just keeps on giving. Under the Work Programme, vast amounts of taxpayers’ money will find its way into the pockets of the people running the new
system. When these contracts were given out last year, it all seemed a little too technical to make into a headline story. But a castle and an £8 million bonus changed all that. Now, the
story of Emma Harrison and A4e is in danger of taking on the status of fable for the Cameron government. This weekend the Observer and the Independent on Sunday both had a pop and shadow Work and Pensions secretary Liam Byrne has
begun to ask some probing questions.
I should declare an interest here. My charity, New Deal of the Mind, has a contract with the welfare-to-work giant. Last week all organisations on the A4e supply chain were warned to refer all
media enquiries to the company’s press office. Finally, everyone seems to have woken up to what it will mean if this storm of negative publicity begins to undermine the operation of the Work
Programme itself and its ability to help the millions of people out there who need it.
Within government, there is a pattern developing here. The Cameron way is to devolve as much decision-making as he can and subcontract the writing of policy. Despite the ‘heir-of-Blair’
narrative, in this he is very different from the centralising control-freakery of New Labour. In Health, this instinct to devolve has landed Cameron in serious trouble. Could the same happen in the
welfare-to-work arena, where, in a sense, there has been a double devolution? The Prime Minister devolved responsibility for welfare reform to Iain Duncan Smith, who, in turn, subcontracted the job
of remodelling welfare-to-work to Lord Freud and Chris Grayling. In an ideal world this is exactly how government should work (and there is much right-wing utopianism in the Cameron government).
But there are two fundamental flaws at the heart of the Work Programme reforms. The first is that this was a scheme designed during a time of economic growth for a world where there was a
relatively ready supply of jobs. For the prime providers to deliver in a time of economic contraction will be extremely difficult without pumping further incentives such as the Youth Contract job
subsidies into the system. And the second flaw is the bolt-on rhetoric of the Big Society, which is supposed to be part of the Work Programme pledge. There is very little evidence as yet that the
prime contractors are passing on work to charities. But, to be fair, the system devised by Lord Freud was never really designed to deliver for the third sector.
The figures speak for themselves. Under the previous back-to-work scheme, the Future Jobs Fund, New Deal of the Mind helped more than 800 people into six-month placements and 70 per cent went into
jobs or education as a result — a massive saving to the benefits bill. Under the Work Programme, we have been removed from the process altogether.
So what happens now? What is the government doing to reassure small organisations in A4e’s supply chain that this mess will be sorted out? David Cameron needs to get a personal grip because
his political credibility is at stake here, as are the lives of the millions of people out there who are desperate to get back to work.