Is the Work Programme working? No, say MPs

Scheme accused of "extremely poor" performance after just 3.6 per cent of claimants are moved off benefits and into sustained employment.

By George Eaton

MPs on the Public Accounts Committee have released their report on the Work Programme and their verdict? It’s not working. In the first 14 months of the £3bn scheme’s existence (June 2011-July 2012), only 3.6 per cent of claimants were moved off benefits and into sustained employment (six months or more), a performance that Margaret Hodge, the chair of the PAC, describes as “extremely poor”. The success rate was less than a third of the DWP target of 11.9 per cent and even below the official estimate of what would have happened if the programme had never existed, prompting Labour to claim that it was “worse than doing nothing”. Not one of the 18 providers, such as A4e, Ingeus, REED and G4S, managed to meet its minimum performance targets, with the best provider moving five per cent of claimants into work and the worst moving just two per cent.

And it’s those most in the need of help who are failing to get it. As Hodges says, “It is shocking that of the 9,500 former incapacity benefit claimants referred to providers, only 20 people have been placed in a job that has lasted three months, while the poorest performing provider did not manage to place a single person in the under 25 category into a job lasting six months.” Given the extent of the failure, the MPs warn that there is a high risk of one or more of the providers going bust, or having its contract cancelled. “The Department must identify cases where a provider is at risk of failing and ensure there are specific plans in place to deal with this”.

The government has responded by insisting that it’s “still early days” and that there are signs of improvement. It points out that the orginal performance targets were set when growth was expected to be significantly higher than it is now. But given that the IMF, the National Institute of Economic and Social Research and others argue that the excessive pace of austerity is at least partly to blame for this, it’s not clear why the coalition regards this a legitimate excuse.

The next set of performance data will be released in March and with unemployment continuing to fall, even as the economy continues to shrink, ministers are confident that it will be more positive. But with expectations now so low, it will be important for MPs to maintain scrutiny. If the government continues to revise its definition of “success”, it will deserve little credibility.