Fair Chance to Work Initial voluntary and community sector experiences of the Work Programme in London

The Work Programme: policy drivers Simplification: single, universal, mandatory programme Outsourcing of service delivery– longer, larger contracts; diverse supply chains Payment by results – transfer of risk from govt to providers; ambitious performance targets Black box – a personalised, customised service Big Society …?

Work Programme and Big Society April 2011: “a massive boost to the Big Society” DWP “Currently, some 30% of sub-contracts are with voluntary sector organisations - and we are confident the WP will build on this” DWP “If a prime contractor wins the bid with a sexy list of sub contractors then dumps them the day after, then we will dump them in return.” Chris Grayling

Work Programme and Big Society October 2011: “We need to be much better at commissioning in a way that creates a genuinely level playing field. It is too easy to do things …with big contracts requiring a performance bond and a minimum turnover requirement for the bidders, which excludes a lot of smaller providers, particularly social enterprises and VCS providers.” Francis Maude

Supply chain composition in London

Supply chains in London Organisations in supply chain PrimeTier 1Tier 2TOTAL Ingeus13922 Maximus91322 Reed62733 A4E CDG Seetec71724

Supply chains in London Approx VCS share of delivery Ingeus16.3% Maximus52.6% Reed9.1% A4E14.0% CDG20.0% Seetec8.0% TOTAL20.0%

Supply chains in London Tier 1: 23 VCS organisations Most (but not all) geographically based: Action Acton, Community Links, LifeLine, Stockwell Community Resource Centre, etc. Tier 2: 53 VCS organisations Many specialist providers: Acton for Blind People, Age UK, Broadway, Capitalise Debt Advice Partnership, Disability Works, Gingerbread, Mind, Praxis, St Mungos, Nacro, Tamil Relief Centre, etc

Survey September VCS subcontractors across London Experience of Work Programme so far Confidence that Work Programme would succeed Tier 1 and tier 2 – different experiences

VCS provider experience Tier 1: Referral numbers as expected or higher (mostly JSA) Focus on implementation Customer groups don’t reflect individual needs TUPE problems: lack of clarity; short notice; no room to negotiate; mismatch in pay/conditions Only one reported that prime had ‘softened’ risk

VCS provider experience Tier 2: For most groups, no referrals whatsoever (just 2 out of 25 have had any referrals) Frustration at lack of communication from primes Downward renegotiation of prices Many have no formal contract (just 9 out of 25 have a signed contract)

Key VCS concerns Viability of programme Are you confident that the Work Programme will attain the DWP's minimum performance level in your CPA(s)? YES : 4NO / UNSURE : 40 Is the differentiated payment mechanism adequate to ensure help for harder to reach client groups? YES : 3NO / UNSURE : 41

Key VCS concerns Low level of VCS delivery Drop from earlier levels - despite rhetoric Failure to engage specialist service providers (groups turning down contracts or missing out, others languishing on tier 2 arrangements) Risk has been passed down supply chain by primes – in pricing structure, or uncertainty over referrals Tier 2s will drop out?

Key VCS concerns Customer categorisation Customer groups don’t reflect individual needs (e.g. JSA claimants with mental health problems) Without accurate needs assessment, how can services be personalised? If no referrals to tier 2 specialists, what support are disadvantaged customers getting? How to prevent ‘parking’ within customer groups?

Key VCS concerns Oversight First official performance data - October 2012 Merlin not yet operational 6 primes meetings Mayor/GLA

What’s next… Early days Desire for better communication from primes For many VCS groups – focus on survival ESA customer referrals due to begin – health support In-work support increasingly important Work Programme 12 month review by IES – must examine outcomes for VCS and disadvantaged groups Universal credit – opportunity to reshape aspects of WP?

Your experience? Questions? Concerns? Steve Kerr Policy Officer, LVSC