Margaret Hodge is "astonished" at the ineffectiveness of the Work Programme

The PAC chair releases a statement on the scheme.

Margaret Hodge, the Labour chair of the Public Accounts Committee, is "astonished" at the performance of the government's flagship Work Programme:

This first analysis of the Work Programme performance figures shows the extent to which the scheme is failing participants, and particularly the young and the harder-to-help. Against a contractual target of 5.5 per cent, the lowest performing provider did not manage to place a single person in the under 25 category into a job lasting six months. The Work Programme was specifically designed to incentivise providers to assist those furthest from the work place, but the appalling performance for ESA ex-incapacity claimants demonstrates how this experiment simply is not working. Between June 2011 and July 2012, of the some 9,500 ex-incapacity claimants referred to providers, I am astonished that only 20 people have been placed in a job that has lasted three months.

My committee will be taking evidence from the department next week when we shall expect a clear explanation for what action is underway to turn performance around and get the Work Programme working for participants and the taxpayer.

For background, the Work Programme is the workfare scheme which offers "tailored support" - which can be anything from CV writing classes to mandatory unpaid work - to people who have been out of work for a long time. When viewed against the best estimates of the background rate of "job outcomes" (an unemployed person getting a job and keeping it for six months) it turns out that the programme spent money to, in effect, destroy jobs:

The Work Programme is, so far, worse than nothing at ensuring "job outcomes" – that is, people in unsubsidised work six months after they leave the programme. In the first fourteen months, 3.5 per cent of participants achieved job outcomes, but for people not on the programme, 5 per cent were expected to get jobs, according to Labour's shadow minister Liam Byrne.

…In other words, the Work Programme did not cost £2,000 per job. Instead, for every £4,600 it spent, it destroyed one participant's chance of employment.

Margaret Hodge. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Lord Sainsbury pulls funding from Progress and other political causes

The longstanding Labour donor will no longer fund party political causes. 

Centrist Labour MPs face a funding gap for their ideas after the longstanding Labour donor Lord Sainsbury announced he will stop financing party political causes.

Sainsbury, who served as a New Labour minister and also donated to the Liberal Democrats, is instead concentrating on charitable causes. 

Lord Sainsbury funded the centrist organisation Progress, dubbed the “original Blairite pressure group”, which was founded in mid Nineties and provided the intellectual underpinnings of New Labour.

The former supermarket boss is understood to still fund Policy Network, an international thinktank headed by New Labour veteran Peter Mandelson.

He has also funded the Remain campaign group Britain Stronger in Europe. The latter reinvented itself as Open Britain after the Leave vote, and has campaigned for a softer Brexit. Its supporters include former Lib Dem leader Nick Clegg and Labour's Chuka Umunna, and it now relies on grassroots funding.

Sainsbury said he wished to “hand the baton on to a new generation of donors” who supported progressive politics. 

Progress director Richard Angell said: “Progress is extremely grateful to Lord Sainsbury for the funding he has provided for over two decades. We always knew it would not last forever.”

The organisation has raised a third of its funding target from other donors, but is now appealing for financial support from Labour supporters. Its aims include “stopping a hard-left take over” of the Labour party and “renewing the ideas of the centre-left”. 

Julia Rampen is the digital news editor of the New Statesman (previously editor of The Staggers, The New Statesman's online rolling politics blog). She has also been deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines. 

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