Select Committee on Education and Employment Appendices to the Minutes of Evidence


Memorandum from Groundwork UK


  1.1 At Groundwork's annual conference in January 1998 the then Minister for Employment the Rt. Hon. Andrew Smith MP set out the Government's aspirations for the New Deal Environment Task Force (ETF). Funded by over £600 million from the windfall tax on the privatised utilities, during the course of the Parliament the ETF aimed to offer 150,000 young unemployed people the opportunity to acquire new skills and abilities by working on a broad range of environmental improvement projects for the benefit of the wider community.

  1.2 High quality placements on innovative schemes would enhance the employability of those taking part whilst bringing about lasting improvements to the environment. The ETF would, according to the Minister, "offer ... a depth of experience and range of skills (to) set it apart from previous schemes".

  1.3 Groundwork is a leading environmental regeneration charity which has been working to breathe new life into some of Britain's most deprived communities for nearly 20 years. Through a federation of local Trusts, Groundwork uses environmental improvement projects as a tool to engage and motivate local people to improve their surroundings and the economic and social well-being of the whole community. Groundwork has been actively involved during its history in a wide range of Government-led employment programmes.

  1.5 Groundwork recognises the importance of the New Deal as a radical approach to tackling the problem of long-term unemployment and sees the ETF as an opportunity to engage and motivate young people in projects which will bring economic, social and environmental benefits to disadvantaged communities.

  1.6 Groundwork is heavily involved in delivering the Government's objectives for the ETF across England and Wales. Groundwork has experience of ETF from a number of different angles. Some Groundwork Trusts are subcontracted to deliver projects by managing agents while others are contract holders themselves.

  1.7 The New Deal has been very successful at getting job-ready young people into work. However, those young people who are harder to place with an employer because they lack the basic skills required for the workplace tend to be forwarded for the ETF.


  2.1 Groundwork has expressed its concern since the launch of the New Deal that the net result of this situation is that ETF is seen by many people as the last resort, only to be considered when it becomes obvious that a jobseeker cannot be placed with an employer or into further education or formal training.

  2.2 Those entering the ETF, therefore, are often those with a much lower level of skills, abilities and aspirations, young people who are not job-ready and often require more basic training. It is not uncommon for Groundwork Trusts to find that all of their ETF referrals lack basic work skills. In addition, many have personal problems such as alcohol or drug dependency, some are on probation, under community service orders or homeless and large numbers are "graduates" of previous job creation and training schemes.

  2.3 This image of ETF has a knock-on effect in that the numbers of people being referred to the option have, historically, been lower than that anticipated by the Employment Service resulting in some financial difficulties where providers are forced to run works teams below capacity.

  2.4 The nature of the client group also means that absenteeism is a recurring problem and many clients simply drop out of the programme before the end of their 26 weeks. In fact it has been calculated that the retention rate for Groundwork's ETF programmes is in the region of 40 per cent. Again this has financial consequences for placement providers. More importantly, however, it means that a large group of young people risk falling through the net of statutory provision and drifting into the informal economy and crime.

  2.5 Groundwork sees working with this client group as a challenging opportunity to open up new possibilities for marginalised and disaffected young people, particularly when ETF is delivered within the framework of wider community regeneration programmes.

  2.6 However, having been involved in delivery of the ETF since its inception, Groundwork is concerned that the New Deal arrangements, when taken in isolation, are unlikely to provide satisfying and sustainable employment opportunities for the "disadvantaged and the disenchanted".

  2.7 Given the skill level of the majority of clients now coming through the Gateway into ETF, six months is often not enough time to develop sufficient abilities and confidences to access full employment. Furthermore, a small benefit "top-up" provides insufficient motivation to attend a project, which is often seen as compulsory rather than as a positive work experience placement with the prospect of a real job at the end. Sanctions for non-attendance are also difficult to enforce leading to further financial uncertainties for placement providers.

  2.8 Groundwork's outcome statistics reflect these difficulties with just over 20 per cent of those people starting the placement moving into permanent employment at the end of the programme. However, it must be remembered that around half of the people referred to Groundwork's ETF programmes leave or drop out of the programme before their individual training plan has been completed. Some 45 per cent of those people who stay the full 26 weeks move into employment at the end of their placement.

  2.9 In Groundwork's experience, ETF is of most value when used as an additional element in a project which has existing funding or as a catalyst to lever in the additional monies required to implement longer-term, more structured work training placements.

  2.10  It has always been suggested that this type of arrangement could be used to enhance ETF. Groundwork believes that without this approach the success of standard ETF programmes will always be limited.

  2.11  Using New Deal funding as one element in a more substantial funding package allows the ETF to be transformed from a community "make-work" scheme into the opportunity to take up real employment on a project for which the local community has already identified a need.

  2.12  The role of organisations like Groundwork is crucial in this respect as training placements can be designed and delivered as an integral part of large-scale community regeneration programmes. This is not only important for the value of the work being delivered to the community but also for the quality of experience received by the client in terms of the personal satisfaction gained.

  2.13  Equally important is the need to establish strong partnerships with local authorities, the Employment Service and other regeneration agencies.

  2.14  Since ETF was launched Groundwork has been seeking to deliver these added-value benefits through intermediate labour markets (ILM). These ILMs, delivered in partnership and as an integral part of local regeneration strategies, are proving effective at delivering the targets and aspirations originally set for ETF.


  3.1  The ILM model, as developed by the Wise Group in Glasgow, recognises that bridging the gap between benefit dependency and unsubsidised employment requires an extended period of personal training and useful, properly paid work. It aims to get clients into the habit of work and to improve their skills and self-confidence by giving them a period of employment which contributes to the community and the local economy.

  3.2  Groundwork utilises ETF as the foundation for ILM programmes which offer waged placements to clients as opposed to benefit enhancements. This approach is fundamental to the success of the projects as it gives those employed the personal satisfaction and self-esteem that goes with being "in work" and of being paid "the going rate" for the job they are doing.

  3.3  ILMs also extend the training period from 26 weeks to up to a year to allow enough time for young people, many of whom may never have worked before, to establish the basic confidence, skills and discipline needed to hold down a job. A wide range of personal support is also made available including help with literacy and numeracy or referral to drug and debt counselling services.

  3.4  Groundwork is delivering ILMs in fields as diverse as horticulture and woodland management, waste minimisation and recycling, energy conservation and home insulation, home security and crime prevention, landscaping and town centre management, construction and environmental art.

  3.5  Clients are able to develop real transferable skill such as administration procedures, marketing, ordering and purchasing and customer relations. Targeted education and training is also included with clients undertaking NVQs, health and safety training and achieving specific personal objectives such as commercial driving licences or first aid certificates.

  3.6  Groundwork strives to ensure that ILMs are "client-focused" in that they are, wherever possible, designed and delivered to help participants develop the skills required by local employers.

  3.7  Groundwork is also working to ensure that the private sector is involved as partners in the delivery of ILM programmes. Transco Green Futures is an initiative developed by Groundwork and Transco with funding from the Lattice Foundation (formerly BG Foundation). It gives unemployed young people the chance to take part in regeneration projects in their own neighbourhoods while offering mentoring, support and work placements, many of them with Transco itself. The programme has so far offered training for nearly 400 participants in six unemployment blackspots in Manchester, Leeds, Derbyshire, Barnsley, Liverpool and Nottinghamshire.

  3.8  The average success rate of people moving into work from Groundwork's ILMs is over 60 per cent.

  3.9  Groundwork believes its ILMs are much better able to provide opportunities for those furthest removed from the labour market to obtain and retain a job than standard ETF projects. In some communities, however, the job vacancies simply don't exist for ILM "graduates" to move into. In these areas new jobs must be created and Groundwork's ILMs are increasingly being used as "enterprise rehearsals" for new businesses offering local environmental maintenance or new green services and technologies.

  3.10  Groundwork is already supporting community enterprises in a range of fields from organic food box schemes to domestic waste recycling. Such ventures have many advantages. Local service provision is generally labour intensive and reduces "leakage" from the local economy. Since such enterprises are often meeting needs in disadvantaged communities, they can also help reduce local disparities in service provision and job opportunities, building social cohesion.


  4.1  Encouraging enterprise through the creation of "green collar" community businesses not only helps tackle exclusion by creating new work opportunities but can also be a key tool in improving the quality of life for the wider community.

  4.2  Groundwork and The Royal Bank of Scotland recently launched a £100,000 pilot programme to support up to a dozen new environmental enterprises linked to ILMs in the North West and Midlands. The bank's small business advisers will offer practical guidance and the project will be used to establish a "green business creation toolkit".

  4.3  European Commission reports suggest that the most promising sectors for future job creation are urban renovation and rural development, which provide a range of "green" business opportunities including construction using sustainable materials, urban renewal, rural development and heritage conservation.[18]

  4.4  There is also growing evidence to suggest that future environmental policy or legislation may foster job creation in many sectors. Studies indicate that new environmental legislation will result in a net creation of between 1 million and 3.5 million new jobs[19].

  4.5  Through its Environmental Business Services teams, Groundwork is working with hundreds of SMEs identifying the opportunities for cost reductions and business expansions through the implementation of environmental management systems. Linking this activity with opportunities to provide training and work placements for New Deal participants is the next logical step in this process.

  4.6  Groundwork believes that any review of the success of New Deal and, in particular, the ETF option of New Deal must look seriously at the potential offered by ILMs as a vehicle for delivering many of the Government's priorities:

  4.6.1  They offer a route back into the mainstream for those people currently not benefiting fully from New Deal.

  4.6.2  They offer extensive support to provide the basic work skills lacking in many communities. This issue is currently being addressed by DfEE through the "Intensive Gateway".

  4.6.3  They join up the Government's strategies on employment, sustainable development and neighbourhood renewal.

  4.6.4  They promote enterprise creating new "green jobs" in areas where there are few jobs for New Deal "graduates" to move into.

  4.7  A recent evaluation of Groundwork's ILMs by Professor Peter Lloyd of Liverpool University concluded that "ILM projects are an important device for squeezing more jobs from economy and society." He also underlined the value of attaching ILMs to the environmental sector: "The environment offers perhaps the most promising locus of opportunity for ILMs. In particular it offers the prospect not only of valuable skill development for the future but also a real new source of job opportunity. Occupying eight of the 19 new sources of employment identified by the European Commission, the environment deserves to attract maximum attention in the task of dealing with intractable unemployment.[20]

  4.8  Professor Lloyd, however, goes on to suggest that without a more secure funding platform, these ILMs are likely to remain relatively insignificant in comparison with the scale of the challenges faced by many of the UK's most deprived communities.

  4.9  It is accepted that ILMs are not a cheap option. Orthodox ETF costs are, on average, around £2.5K per person for six months' work experience. On average, Groundwork's ILM costs are estimated at between £12K-£14K per worker for around one year. However, ILMs offer a much greater success rate in terms of job outcomes and also deliver a "triple dividend" tackling exclusion, contributing to sustainable neighbourhood regeneration and stimulating enterprise. They are therefore highly cost-effective.

  4.10  Groundwork's ILM practitioners currently spend a great deal of time assembling "funding towers" from New Deal, SRB, ESF, ERDF, Rechar, Landfill Tax, Lottery, private sector etc. If one block is removed, the whole edifice becomes unstable leading to funding gaps and, with a roll-on roll-off programme, this can be catastrophic.

  4.11  A number of major regeneration funding sources (eg SRB) have recently been re-focused to help support employability initiatives. However, no single source is currently available to provide sustained support for ILM initiatives.


  5.1  Groundwork believes the current review of New Deal offers a golden opportunity for transforming ETF from the "Cinderella option" of New Deal to its flagship programme.

  5.2  As part of the review of New Deal, ETF should be re-branded to reflect its central role in neighbourhood renewal. Groundwork's ILMs offer local unemployed people the chance to find a job while working to improve their local surroundings, thus reviving local economies and local communities (two of the central tenets of the National Strategy for Neighbourhood Renewal).

  5.3  A national "skills for work" qualification should be introduced to reflect the fact that many people taking part achieve a mix of new workskills and lifeskills. Groundwork has already put together the central elements of such a qualification.

  5.4  Local authorities should be encouraged to support and sponsor ILM initiatives and implementation teams as they are adding value to local regeneration activities. ILMs can play a major role in supporting the delivery of Local Agenda 21 and area-based regeneration initiatives. They also have the potential to achieve many of the national targets which have been set for local authorities eligible to receive support through the Neighbourhood Renewal Fund.

  5.5  Regional Development Agencies should be urged to give greater priority to "green jobs" and social enterprises as the focus for the economic regeneration of deprived areas. RDAs should also be supporting links between ILM deliverers and local employers to widen still further the range of job opportunities available.

  5.6  The Social Investment Task Force recently called on the Chancellor to support more community businesses in deprived areas. We believe this offers the perfect opportunity for the Government to join up its thinking on neighbourhood renewal, sustainable development and social inclusion by creating a venture capital fund fur ILMs and green enterprises.

Groundwork UK

November 2000

18   Based on an extract from "Communication on Environment and Employment", EU Commission 1997. Back

19   "An estimate of Eco-industries in the EU", Ecotec-Eurostat DGXI 1997 Back

20   Intermediate Labour Markets in the Environmental Sector-Professor PE Lloyd, August 2000 Back

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