Select Committee on Work and Pensions Minutes of Evidence

Supplementary memorandum submitted by Tomorrow's People (ES 05B)

  1.1  This paper is supplementary to submission ES 05 from Tomorrow's People, and the background statement submitted 7 May 2002. It provides follow-up information to questions raised during the evidence session held 8 May 2002.

  1.2  Information about interventions specifically for SMEs was requested. Across the country, Tomorrow's People's work with employers of every size. In London, our Getting London Working programme helped over 300 people into employment in 2001, the first year of operation. Of these people, 12 per cent entered small companies with less than 15 staff, and 30 per cent went into jobs in medium-sized companies of 15-30 staff. Of the employers registered with Getting London Working, 17 per cent are small, employing between 0-10 staff, 36 per cent are medium-sized, employing 11-25 staff and 47 per cent employ more than 25 staff.

  1.3  Since September 2001, our Getting Newcastle Working programme has assisted 44 people into employment, and 32 people into training positions elsewhere. Of these clients, 30 per cent went into companies with fewer than 20 staff, and 66 per cent were placed into companies of over 250 staff. Within the SMEs, those individuals have sustained their employment on average for six months. 19 people have found jobs with Northern Rock, around 50 per cent of whom are third-generation unemployed, and the majority of these have sustained that employment up to six months. In South Tyneside, between January and March 2002, we achieved 13 placements, nearly three times the number of jobs than the target profile set. Of these people, 56 per cent were placed into companies with fewer than 50 staff, and 31 per cent with companies of fewer than 150 staff.

  1.4  Within the Plymouth area, 94 per cent of employers have 1-24 employees (Prosper, 2001). From April 2001 to end March 2002, our Plymouth Workroute programme has helped 706 people, of whom 269 have entered employment, 102 have entered vocational training, and the remainder are ongoing. On average over the last 12 months, Plymouth Workroute has achieved job retention rates of 89 per cent.

  1.5  As well helping unemployed people into jobs, Tomorrow's People work innovatively with employers to find alternative solutions where few actual job vacancies exist. AstraZeneca, the national pharmaceuticals company has an environmental laboratory at Brixham, employing a workforce of 100 people, and is a significant employer in an area of high unemployment. AstraZeneca is taking direct action, through providing practical help, and the use of office accommodation and help with running costs. Between August 1998 and April 2002, AstraZeneca has assisted 437 clients, 244 of whom are now in employment, and 76 have entered vocational training. Brixham is one of the two locations in the UK where Tomorrow's People work innovatively with corporate employers. Whilst AstraZeneca have met the cost of this service the main beneficiaries have been both unemployed people and SMEs.

  1.6  In Merseyside, our Corporate Workroute initiative, in existence since September 1999, and later developed into Getting Merseyside Working in September 2001, is based around a coalition of leading employers in the area. Key partners such as Littlewoods, Scottish Power and Royal Sun Alliance provide not only funding but also assistance in kind, through use of office workspace and facilities. The objective is to engage long-term unemployed people with SMEs, with Tomorrow's People facilitating the job matching and employment process for these employers. A key element of our success has been the offer of a dedicated Employer Adviser, who acts as an ongoing intermediary, and our involvement with the Local Business Association Network, whose membership is comprised of the micro and SME employers. Since launch, 393 people have received our help, and 212 of those entered employment. 89 per cent have sustained that employment over 6 months, and 85 per cent over 12 months. Estimates suggest that 60 per cent of placements are made into companies of fewer than 250 staff.

  1.7  Tomorrow's People provide help to unemployed, socially excluded and young people, and believe that prevention is better than cure. This philosophy underpins our drive to help clients into sustainable employment, because our experience has shown that the best way to break the cycle of exclusion is by helping individuals get and retain a job.

  1.8  Tomorrow's People continually develop new strategies and interventions to prevent people from becoming unemployed, or unemployable, in the first instance. It is our wish to see a system of self-sustaining employment, without the need for intervention.

  1.9  For young people, managing the transition from school to work or further education is essential to prevent them becoming unemployed, as is supporting them through the journey to fulfilling employment. For others, it is through managing the transition between jobs, quickly acting to ensure those individuals find the next opportunity rather than waiting six months before receiving support from employment services.

  1.10  By engaging employers to help those people facing redundancy at a much earlier stage, it is possible to prevent workers from becoming disconnected with the labour market and job opportunities.

  1.11  With regard to the bidding for funding, Tomorrow's People frequently compete both with and against the public sector. Organisations that are not preferred partners are often disadvantaged in terms of overhead cost recovery. It is our recommendation that a level playing field be established, whereby all organisations operate to the same levels of risk, and with the same transparent cost structures. Preferred partner organisations do not have to account for project risks such as responsibility for employment, cost of redundancies, TUPE, premises or dilapidations. For instance, Tomorrow's People were unable to pursue bidding for Employment Zones and other projects because they were not commercially viable and made no allowance for ongoing operational costs.

  1.12  In addition, despite progress with the "best value" concept, it is the case that all too often contracts appear in practice to be awarded solely on cost without sufficient attention to the quality of performance. We would suggest that the contracting process should also focus on public policy outcomes, such as sustained employment and associated benefits to individuals, their families, the community and local economy, as well as considering legitimate financial inputs.

  1.13  As stated in the evidence session, the experience of applying for funding is both complex and frustrating, because the system depends on multiple sources. Better co-ordination of timing of bids for matched funding would ensure relevant fund holders operate to the same deadlines. Organisations waste vital resources on applications that cannot be completed because the contingent funds from a different budget have already been allocated.

  1.14  There are also issues with the timing of tenders. Organisations are frequently given four weeks in which to tender. This is an insufficient period to enable quality bids to be researched, prepared and submitted. Tenders may require evidence of partnership with the local community, which provides an unfair advantage to organisations that currently deliver in an area.

  1.15  With regard to the levels of budgets, we would welcome an approach that provides sustained and adequate funding, to support and maintain projects beyond the stage of simply establishing the initiative. Currently, funding is at best on an annual basis and often varied at much shorter notice because of changing short-term priorities. It is important to be able to plan further ahead than 12 months, if organisations are to invest in people, systems, premises and other resources. Currently, the short-term nature of funding conflicts with the longer-term aims of delivering meaningful outcomes, and in turn this inhibits providers from bidding for contracts.

  1.16  Tomorrow's People would recommend greater harmonisation and simplification of the application process. In particular, we note that when applying for regeneration funding applicants often have to supply identical background information about their organisation every time they bid for funds, plus frequently having to supply identical accounting data as well.

  1.17  Tomorrow's People would suggest that organisations are able to lodge such background information with a central Governmental body, or indeed in escrow, so that it may be referred to when bids are examined. This would substantially reduce the administration by the applicant and would enable organisations to focus on the specific issues associated with any bid.

  1.18  In summary, Tomorrow's People welcome the opportunity to expand on the issues raised by the Committee, and believe that there is much scope to implement positive changes. Identifying ways to prevent people who are either leaving school or their job from falling away from the labour market is critical to breaking the cycle of unemployment and social exclusion. Establishing a level playing field, with greater transparency in the bidding process, and a more balanced approach to risk in commissioning projects would also be welcomed. Creating more accessible routes to funding and sensible co-ordination of different funds would enable faster transition of funds to actual project delivery, where it is most needed.

Debbie Scott

Trust Director

21 May 2002

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