Today’s headline figures on the Work Programme are not good news for the government: in its first 12 months, only 2.3 per cent of participants actually landed sustainable employment against the department’s target of 5.5 per cent. This sounds even worse when you contrast it with the government’s own figures suggesting that 5 per cent of people who have been unemployed for a long time can find sustainable jobs without any intervention at all, suggesting the programme is actually worse than doing nothing.
At Coffee House, we are keen to see the Work Programme succeed, not just because it will vindicate the ministers co-ordinating it, but also because a successful programme would bring those furthest from the labour market back into employment. So the first tranche of figures is disappointing.
But they must be read as part of the broader economic picture: when this scheme was set up, it was based upon the assumption that the British economy would be growing by 2 per cent a year. The Work Programme was not set up as a solution to the weak economy, but to the problem of a long-term unemployment rate that was too high even before the recession bit. But because the recovery is dragging its feet far more than anyone (including Sir Mervyn King) believed it would, there are not as many jobs available as a whole, let alone for those who, in spite of intensive training, will have long gaps in their CVs.
Some of these problems were highlighted earlier this year by the CBI in a report called Work in Progress, which said ‘providers are… operating in a much tougher economic and labour market conditions than originally envisaged, with potential implications for their financial and commercial models’. The CBI recommended improving the referrals process for those furthest from the labour market to ensure they move onto the work programme as soon as they are capable of looking for a job, encouraging self-employment, joining the programme up with services for ex-offenders and encouraging more employers to work with the programme. The government may well want to take heed of some of these recommendations if the figures continue to disappoint.
And, as Pete Hoskin points out in his ConHome blog, it is too early to condemn the Work Programme as a failure, especially if you’re a Labour MP, as that party’s own welfare-to-work programme also missed its targets.
But in the short-term, this is an awkward piece of news for the Government. Employment minister Mark Hoban has written an upbeat piece for PoliticsHome, saying ‘critics call for us to change course, but we won’t be doing that’, but he is writing to under performing providers on the programme, threatening that if they do not up their game, they will not receive as many new claimants. The success of this programme is hugely important to the government’s ability or otherwise to sell itself in 2015 as the party that finally reformed welfare: ministers will want to do everything they can to prove the critics wrong, and that includes taking on board some of the early warning signs about providers and the design of the programme.