1. Mandatory and Voluntary Participation in Work Programmes for People with Health Conditions William Smith Chief Executive Officer – Ingeus Europe 27 October 2010

2. Expenditure on disability benefits and rehabilitation in Sweden has steadily increased … Source: Eurostat

3. …despite participation remaining relatively stable. Source: Eurostat

4. Reasons for huge growth in numbers of people on a health-related benefit… 1.Greater tendency to diagnose people with ‘modern’ mental illnesses - such as stress, anxiety and depression 2.Creation of a more litigious society and doctors’ fears about ‘playing safe’ 3.Existence of financial incentives for being categorised as ‘unfit for work’ 4.Connivance of Governments to allow large numbers of people to be classified as long-term sick rather than registered as unemployed

5. Recent attempts to address this with voluntary and mandatory participation 1.Huge ‘stock’ of people on these benefits (2.6m in UK) and also a significant flow each year. 2.Focus has been on reducing the ‘flow’ by introducing limited mandatory participation 3.Volunteers from the ‘stock’ have also been encouraged 4.Success rate for voluntary clients is much higher even though these are from the stock but the percentage voluntary response rate is low – less than 5%

6. UK Pathways to Work has focussed on the flow – with limited success 1.Cautious approach - mandated attendance for 6 work- focussed interviews at monthly intervals – participation in active programme is voluntary 2.Clients referred to programme before medical ‘work capability assessment’ is complete - with up to 20% subsequently being declared not eligible 3.Time taken to get client engagement seriously underestimated – not helped by monthly interview pattern 4.High percentage of clients were long-term unemployed before becoming long-term sick

7. Assessment of ‘flow’ group and fitness for work Since 2008 all new ‘flows’ onto incapacity benefits have been subject to a work capability assessment. Results of this (just published) are: Support Group (cannot work) – 7% Work-related group (can work in future) – 15% Fit for work now group – 39% Client closes the benefit claim – 39%

8. Early diagnostic intervention can prevent people becoming long-term benefit recipients… Early intervention: Working with people in employment identifies risks to future long- term-work ability Provide support to employers to facilitate job retention through condition management Recent UK approach – Pathways to Work and Fit for Work pilots Switzerland pilots in Zurich based on UK Pathways model Diagnostics: Assessment with employment advisor supported by health specialists to identify mental and/or physical needs Personalised employment plan with specialist CMP support.

9. Ingeus Condition Management Programme… Referral of client to CMP Specialist support Independence and return to work Diagnosis to focus on needs of client Physical or mental health specialists Workshops to raise confidence Progress towards being work-ready Support to manage health in work context Access to other support organisations

10. CMP addresses mental and physical needs of clients in the work context Group interventions - social interaction and confidence building Personal interventions - listening to clients and providing practical support plus referral to specialist advisors Activation support with relapse prevention strategies - enabling clients to make practical steps back towards employment Optimal balance between work and health In-work support from specialist and employment advisors

11. Factors affecting performance for clients with health conditions....... More time needed to achieve job outcome than with other jobseekers Big difference in results between ‘voluntary’ and ‘mandatory’ clients Mandated clients need time to be persuaded that work can be good for them Role of Medical Doctors is important – can be positive and also very negative Early intervention is best but Medical profession may disagree Vital to get clients ‘positively engaged’ and with a changed mindset Need to have scope for gradual build-up of hours worked Clients need confidence that they can return to benefit if condition worsens

12. Performance achieved for clients with health conditions...... For early (voluntary and pre-recession) programme in UK, rates of 50% back into work, with 80% sustaining to 13 weeks were achieved For Pathways to Work (UK) programme, rates for mandated clients were initially significantly lower - less than 10% in first year of operation Not helped by poor programme design - mandatory element meant only attending 6 monthly interviews and delay in medical capability tests Recent (UK) performance has increased to between 18% and 38% Zurich pilot launched last year – early cohort achieving 40% return to work Although voluntary in Zurich client engagement is also critical which takes a lot of time time

13. Smarter procurement can help........... Contracts are best when awarded on quality rather than price – with price is set by purchaser Funding linked to longer-term sustainable outcomes Need to recognise time taken to achieve results not a quick process Focus on flexibility, innovation and outcomes – not inputs Long contracts to encourage investment in innovation Clients referred need to be certain about their eligibility Competitive outcome does not necessarily require huge number of providers

14. Prime Contractor – Single Work Programme? Single programme regardless of type of benefit Recognition of different needs through differential pricing Payments largely (but not only) by results ‘Black-box’ approach with service design left to providers Much larger contracts Requirement to involve extensive supply chain of subcontractors Competitive outcome but possibly with no more than 2 prime providers per large contract area

15. Prime contractor model.... Purchaser Prime Contractors Subcontractors (specialists and smaller organisations) Sets objectives for quality Focus on a few Primes Evaluates programmes Manages proactively Creates innovation Delivers core of contract Achieves diversity of experience through sub- contracting Deliver specialised programme elements Meets complex client needs

16. www.ingeus.com