Select Committee on Work and Pensions Minutes of Evidence

Examination of Witnesses (Questions 360 - 379)



  360. Just so, but what I wanted to ask you is when you will be in the position to take a decision about whether there will be private sector involvement or not.
  (Mr Brown) We are rolling it out as a public service. I would certainly want to evaluate the lessons from the final report on the ONE pilots to see if there was anything—

  361. You cannot give a date?
  (Mr Brown) 2002 will be when the ONE pilots are, I imagine, drawn to a close[80]. Obviously I wait for advice closer to the time. Remember that as we roll out a Jobcentre Plus, and the Government is firmly committed to making Jobcentre Plus a uniform service across the country, we will absorb the ONE pilots in that. The idea is that it will be a seamless move from the ONE pilot to the Jobcentre Plus service, and that is a public sector service; that is the Government's plan. Of course, if the evidence from the pilots shows something that the Government would want to take account of then we will, but the early evidence is not really there.

  362. Can I move on to ask a question about one of the three contractors involved, which was Deloitte Consulting, who have withdrawn from involvement in Leeds and Suffolk? Has this resulted in any problems?
  (Mr Brown) I was disappointed, frankly, because the purpose of the pilots was to enlist private sector involvement as well as what the public sector could do in innovative circumstances, but the advice to me as the Minister was very clear. Since they were withdrawing they could not continue and since we wanted to continue with the pilot the recommendation was that the public sector should take it over and that is what we have done.

  363. Can I come to some of the reasons why they may have withdrawn—and these were problems that were expressed—I think it is fair to say, by all three witnesses and not just by Deloittes, which were that they felt from their experience of ONE that there was commitment at the top from politicians like yourself and from others and there was enthusiasm at the grass roots, but what they expressed some frustration with was what you could call the middle level where they said that there was an administrative tier that was preoccupied by process and procedure at the expense of bringing initiative and more flexibility into providing employment opportunities. What is your reaction to that?
  (Mr Brown) The point has been made to me, and I have tried to have a look at it, but there are countervailing arguments about the need to safeguard public money. It would be a rash minister who would say, "We will put those to one side".

  364. And you are giving more weight, are you, at the moment to that consideration that you have just mentioned than to the private sector view that there has been inflexibility in this middle sector?
  (Mr Brown) We are looking probably at the same issue but through different sets of eyes. People have differences of view depending on where they are coming from. I have not seen anything that convinces me that those who are in charge of administering the overview of the projects have behaved unfairly to the private sector. If people really wanted to press that point I would be happy for them just to come in and see me and to make that point and nobody has done that so far.

  365. Do you think there have been any lessons you have learned at all from the private sector about realising the potential of public sector staff or encouraging what is sometimes called a "can-do" mentality?
  (Mr Brown) It is certainly true that the staff in Jobcentre Plus, who are working in the reception areas, meeting the public in an unscreened environment, taking this proactive role with claimants, overwhelmingly enjoy what they are doing and believe the proactive role is right. Staff that I have met who are doing outreach work on one of the Action for Jobs projects have said that they like the local discretion, they like the ability to go and meet people in their homes rather than always to see people in an office, and that this freedom to take decisions at a local level is something they find helps to make the job more fulfilling. The early evidence is that it gets results as well. I think there is a very strong case for that approach. I do not take the view that it is something that can only be done in the private sector and cannot be done in a public service. Indeed, the early evidence from the Jobcentre Plus pilots is that the public service is taking to this very well and relishing it. I have visited six of the Pathfinder sites now and my experience was uniform, and I really do not believe that people were just putting on a show because it is the Minister visiting. People were pretty blunt and candid and willing to talk but were very committed to what they are doing.

  366. Are there any lessons that the public sector can learn from the private sector in terms of getting value for money?
  (Mr Brown) I think the services we are providing are value for money. I certainly think that the "can-do" approach is the right one. I would not say that it was alien to public service. Indeed, I am just describing circumstances where it is to be found. On Andrew's earlier point about were the ONE pilots value for money, yes, I think they were. I think the initial monies spent were proportionate to what it was we were trying to discover. Remember that the conclusions which are being drawn from all this are informing substantial decisions on public expenditure and it is a whole series of very significant changes in the way we provide these important public services, not just in the way we provide them front of house but also in the equipment and technologies we use to back up the provision of the service.

  367. Coming back to that answer for a moment, I was not implying that the public sector has no experience at all, is incapable of realising value for money. I was simply asking directly whether the public sector has anything to learn at all from the private sector and, if so, how much.
  (Mr Brown) That is quite a deep philosophical question. I think we all have things to learn from each other. The important thing is to keep talking and to keep abreast of current developments.

  368. The private sector companies, very bluntly, did not feel that you were doing enough to engage their expertise in the lessons they have learned in the development of Jobcentre Plus. What is your comment on that?
  (Mr Brown) They have not said that to me, is my comment to that, or to the officials that advise me. If they have said it to yourselves, if they would like to come and see me or see my officials, I am always happy to see them. The point is new to me personally and if someone wants to come and make a complaint or explain something to me then I am always happy to see them.

Mr Mitchell

  369. I think it is an important point that the private sector are involved in these pilots because they may have something to teach us. It is very important that they should be encouraged. I am disturbed that the message has not got through to you because it was as clear as a pikestaff to us when we took evidence from them. If of course the private sector feel that only lip service is being paid to what they can do and that they are fettered by the unions or whatever, and that was a clear, strong feeling, then we are not going to get the benefit from them and they will not even bid for these things. I do hope that you will get your officials to follow that up.
  (Mr Brown) It is not clear to me how they could be fettered by the unions but perhaps somebody is going to spell this out. After all, they are private sector companies undertaking a particular contract which they have entered into with the Government.

  370. The point I would make is this. The private sector were becoming involved in an area where they have not been involved before and if they are discouraged and if the culture is one that discourages them we will not get the best out of the private sector in terms of innovation and support within the pilot process. That is the point I am making. I hope your officials will look at the last point that Paul made to see whether there is something to learn in the future about the way these things are handled in the private sector.
  (Mr Brown) There are three points to make on that. The contractual terms are the same for private sector organisations and public sector organisations, and indeed the organisation that is a mix of some public sector and some private sector involvement.

  371. I am making a cultural point.
  (Mr Brown) If people have something to say then I am willing to see them. They should come in and see me and talk about it, but it is also the case that there is significant private sector involvement in delivering employment services. There are private recruitment agencies, specialist agencies, that earn their living doing this because the people who employ them think they do the job and do it well. Of course all employers look to their own in-house recruitment techniques as well, so it is private sector employers as well as public sector ones. It is not that there is no private sector expertise in the area.

  372. I absolutely understand the point but nevertheless it was clear evidence to us that the private sector did not feel that their expertise had been engaged to the extent that it could have been. That is the point I hope you will have a look at.
  (Mr Brown) I am sorry they feel like that and I will have a look at the point, but nothing in my correspondence has shown that.


  373. From where I am sitting your answers have been, "Perhaps the private sector have been more cautious than I would have anticipated". Maybe that is what the brief says at the top. These people certainly felt that they had taken a bit of a kicking: they were bound hand and foot and there were more contract managers than there were pilot managers. In spite of all this, and in their report Deloittes said there were difficulties, they still wanted to be round the table and they still felt that they had a contribution to make, and I was quite struck by that. The only point I will leave you with, because I want to go into information technology which is a very important area for us, is that if Jobcentre Plus gets too set in its ways—and that is pejorative language, I know—it is going to be difficult to bring them in later on. You say 2002-03. By then the thing may have crystallised in a way that perhaps does not give them the opportunity. I am taking a long way round to say that if you are genuine about your offer of continuing the discussion with them, I think that that would be something that would be productive.
  (Mr Brown) I would certainly want to continue the dialogue with the private sector. There is a fair bit of the work that we as a Department are setting out to do that is already done by the private sector. We reckon we know about a third of all the jobs that are available in the UK economy at any one moment in time and the other two-thirds are either managed by employers in-house, in other words they recruit by their own methods, or they are handled by private sector agencies. Quite a lot of this work is already done now and always has been by the private sector.

  374. As long as your door is open.
  (Mr Brown) It is a continuing dialogue but I must emphasise that Jobcentre Plus has been rolled out as a public service.

Rob Marris

  375. One of the things that we were sent on Monday was the DWP in-house report number 84, Delivering a Work Focussed Service, Interim Finding from One Case Study and Staff Research which made 16 numbered suggestions for change. What is the date of that?
  (Mr Brown) Leigh, what is the date of that?

  376. It is germane to what I am going to ask you.
  (Mr Stanton) I am just having this checked but I think it is September.

  377. This September?
  (Mr Brown) It is a response to the earlier study of the ONE pilot.

  378. It has made certain recommendations about IT. As an aside, I might say, I do not recall the private sector talking about being fettered by the trade unions.
  (Mr Brown) I do not understand that.

  379. That is not the way I recall the evidence but I will take that up with the member afterwards perhaps. However, I do recall people saying that there was some fettering because of IT, particularly the integration of the Benefits Agency system.
  (Mr Brown) I would willingly concede that.

80   Subsequent to the evidence session the Department for Work and Pensions stated that the ONE Private and Voluntary Sector Pilots should run until March 2003. Back

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