DWP's Commissioning Strategy and the Flexible New Deal - Work and Pensions Committee Contents


6  Customer choice, voice and conditionality

Customer choice

160. An important element of the Flexible New Deal in most areas will be competitive delivery, which should act as a driver of performance among providers. As part of this, DWP noted its intention to introduce a system of choice into FND, allowing customers in multiple provider areas to choose the provider they access. During the first 12 months of FND's operation, DWP will randomly allocate customers to prime contractors in each multiple provider area on a 50:50 basis.

161. The FND Invitation to Tender document explained that after 12 months of operation (i.e. from October 2010) customers will be able to choose their provider but stated that during this period DWP will continue to ensure that providers receive customers on a 50:50 basis. After a further six months (i.e. April 2010) a contractor's market share could shift between a minimum of 30% and a maximum of 70% and this is likely to be reviewed after every six month period.[128] In order to help guide customers in their choice, DWP will provide them with information from its star ratings system of providers and measurements of customer experiences. [129]

162. Introducing a cut off point by having minimum and maximum market share in an area will mean that customer choice can only exist to a certain point. In other words, if based on the information they receive 70% of all customers opt for one provider, there will reach a point when some customers will be obliged to accept a referral to the alternative provider in that area. The value of this will be that it will ensure that competition within an area is maintained but it will remove the element of choice for those new customers coming onto the programme.

163. Customer choice is currently being tested in three Pathways to Work districts and has been used for lone parents on the Employment Zone programme.[130] DWP research has found that the provision of customer choice has proved to be a valuable means of gaining customer buy-in to employment provision. Chris Melvin from ERSA agreed, telling the Committee:

"From my experience, the biggest upside of customer choice is that it empowers the individual; it motivates the individual; it gives the individual a sense that their destiny is in their own hands […] I think that motivation is really powerful; it gives people a sense that they are in control."[131]

164. Many organisations highlighted the propensity of customers to choose a provider based on its proximity to their home, rather than the services it offers, and emphasised the need to ensure that customers were properly informed, understood the importance of choice and were given an appropriate amount of information to make their decision.

165. We welcome the introduction of customer choice to the Flexible New Deal. Evidence from Employment Zones has indicated that this can be important in empowering the individual to take ownership of their pathway back to work. However, it is important that customers are given sufficient information on which to base their decision and we ask that in addition to publishing star ratings, DWP monitors closely the information Jobcentre Plus provides to customers and the main reasons customers give for choosing specific providers.

166. The introduction of minimum and maximum allocations will mean that customer choice will be constrained beyond a certain point. Where DWP has to enforce its allocation thresholds it should investigate further the reasons for customers' choices and, where necessary, take action to address any performance issues with the less popular provider in an area.

Customer voice

167. By including customer choice in some FND areas, customers will be able implicitly to voice their opinion of service provision through their selection of provider. Furthermore as all customers have a right to a mutually agreed, personalised Action Plan this should help to ensure that they are engaged in the process and have ownership of their pathway back into work. However, we heard evidence to suggest that the customer voice should be explicitly represented in the programme. The Scottish Union of Support Employment emphasised the need for customer control and A4e agreed arguing that the "customer voice should be considered a valuable tool for improving the performance of services by progressive prime contractors."[132] One Parent Families/Gingerbread believed customer input and feedback would be vital to the programme's success and suggested that:

"All claimants who are referred to a Flexible New Deal provider should be provided a statement of what they can expect from the provision, the way in which the provider is being funded to deliver the service (ie that the provider receives payment for helping them to access sustained employment), and details of how they can complain to this ombudsman if they feel that the service does not meet their expectations."[133]

168. Recent research has suggested that "service user journeys" in employment programmes are complicated and this can make it difficult for customers to fully understand how a programme works and what is expected of them. In his research, Professor Dan Finn highlighted the establishment of regional and national client councils in the Netherlands, which represent the voice of customers on employment programmes. The National Client Council (LCR) is made up service users and their representatives. As a national council of organisations for social security benefit recipients, it holds regular consultations with, among others, the board of the Central Organisation for Work and Income (CWI) (a similar organisation to Jobcentre Plus) and the municipalities regarding the forms of support, levels of engagement, and success of programmes in getting people into work. In addition, this National Client Council can send proposals to the Minister of Social Affairs and Employment regarding work and income. [134]

169. In order to empower and engage customers on Flexible New Deal we recommend that DWP introduces a customer charter which clearly outlines what is expected of customers and what they can expect in return. This should include recourse to an independent complaints process if they are unable to resolve issues with their provider. As a last resort, customers should be able to take their complaints to an independent Ombudsman who would be responsible for independently resolving such disputes and for reviewing the delivery of the customer charter.

170. The systems for ensuring quality of provision, the diffusion of best practice and safeguarding service user experience appear to be fragmented. Appointing an Ombudsman, with sole responsibility for monitoring and reviewing the services provided and for dispute resolution, would help to ensure the market operates effectively.

EMPLOYMENT OFFICER STATUS

171. The Explanatory Memorandum (EM) to the regulations relating to Flexible New Deal explained that provider staff will be given "Employment Officer" status. Already used in the provider-led Pathways to Work areas, this status will allow providers to raise doubts with Decision Makers if a customer fails to apply for notified vacancies (subject to a variable sanction of up to 26 weeks). Before any sanction decision is taken, the customer will have the opportunity to present evidence of good cause to the Decision Maker. The EM says that Jobcentre Plus Contract Managers and local Jobcentre Plus Managers will monitor the number of sanction referrals they receive to ensure that potential issues are resolved and identified quickly and to confirm that providers are using their Employment Officer status properly and that they do not, for example, use the sanction element of JSA to stop working with customers they do not want to deal with.[135] The Social Security Advisory Committee has raised concerns that the extension of Employment Officer status to provider staff gives significant authority to providers over customers. [136]

172. We recommend that DWP ensure providers' staff are given sufficient training to ensure that they understand their Employment Officer status and their responsibilities within it. It is important that different providers operate the system consistently and fairly and that appropriate, standardised training will be required to facilitate this. We call on the DWP to clarify these responsibilities and their limits in connection with the use of sanctions.

Conditionality

173. A key principle of the Government's welfare reform programme has been the balance between the rights and the responsibilities of the customer. The Flexible New Deal continues this focus; with increased personalisation and the introduction of customer choice comes greater conditionality. During their time on the programme, customers must follow their action plan and must undertake a minimum period of full-time work related activity.

174. Professor Paul Gregg's recent review of conditionality in the benefits system recommends a single personalised conditionality and support regime, where virtually everyone claiming benefits and not in work should be looking for or engaging in activity to help them move towards employment. The report recommended that the Government should adopt a single personalised conditionality and support regime operating in one overarching employment programme. The programme would assess customers before assigning them to one of three broad groups:

a)  A 'Work-Ready' group for those who are immediately job-ready. The requirements for this group would largely be based on the current Jobseeker's Allowance (JSA) regime.

b)  A 'Progression to Work' group consisting of those for whom an immediate return to work is not appropriate but is a genuine possibility with time, encouragement and support. This should contain people who claim or are entitled to Employment and Support Allowance (ESA) but who are not in the Support Group, lone parents with a youngest child aged between one and seven, and partners with a youngest child aged between one and seven. The requirements for this group will: reflect the claimant's co-ownership of the return to work process; be tailored to their capability and built around their circumstances; be based on activity that supports the clients' own path to work; and link up with effective support.

c)  A 'No Conditionality' group, which would not be required to undertake work-related activity or take steps back to work. This would consist of the current Employment and Support Allowance (ESA) support group, lone parents, and partners with a youngest child under the age of one, and carers.

175. The Government plans to test a new single employment programme in March 2011, which will combine the Flexible New Deal and Pathways to Work and include Professor Gregg's recommendations for a new conditionality framework. The recently published Welfare Reform Bill explained that parents with younger children and partners of benefit recipients will be placed in a 'Progression to Work' group. Those placed in this group will not be expected to immediately return to work but will instead be given a personalised conditionality regime which is tailored to the individual's circumstances, so that preparation for work becomes a natural progression. Those in the Progression to Work group will be required to undertake action planning and work-related activities.[137]

176. The Government has been criticised for its plans to increase conditionality. Prior to the publication of the Gregg Report, Sir Richard Tilt urged the Government to rethink or delay plans to increase conditionality on lone parents, people with disabilities and the long term unemployed arguing that it could "push people into poverty" as unemployment rises, particularly if appropriate affordable childcare is not available. Sir Richard, who chairs the Social Security Advisory Committee, said welfare to work reforms risked "falling into disrepute" and called for the changes to be delayed by one or two years.[138]

177. Evidence from Shaw Trust's Pathways to Work programme suggested it was more difficult to engage mandatory clients than those who voluntarily participate in employment programmes. Evidence from across their five contracts showed that the average failure to attend rate for all mandatory Work Focussed Interviews (WFIs) is 47.66% compared to 14.51% for voluntary clients. The best failure rate on its programme is 28% for mandatory clients and the worst is 53.38%. The Shaw Trust argued that Jobcentre Plus should assess customers' vulnerability to sanctions when they first make a claim. It suggested that:

"Those [who] scored a high risk should require a home visit, others could be followed up by telephone, if possible or simply have their benefit sanctioned for one week in an attempt to focus them on attending a WFI."[139]

178. We endorse the Government's plans for welfare reform and its commitment to test a new conditionality framework. However, we support Sir Richard Tilt's concerns that without suitable childcare people might be "pushed into poverty". It is vital that, as conditionality increases, the Government ensures that the right support, such as adequate childcare provision, is available for those individuals moving onto the Jobseeker's Allowance regime. The customer must have the final say on whether childcare is suitable and affordable.



128   Ibid Back

129   DWP, Invitation to tender pack for phase Flexible New Deal, 1 August 2008 Back

130   Ev 68, paras 7.3 - 7.4 Back

131   Q105 Back

132   Ev 98, para 33 Back

133   Ev 128, para 4.12 Back

134   Finn, D. (2008), The British 'Welfare Market' : Lessons from contracting out welfare to work programmes in Australia and the Netherlands, Sponsored by the Joseph Rowntree Foundation Back

135   Explanatory memorandum for the Social Security Advisory Committee from the Department for Work and Pensions - The Social Security (Flexible New Deal) Regulations 2009 Regulations to support the introduction of a revised regime of activities for those claiming Jobseeker's Allowance, including referral to the Flexible New Deal, para 4.53 Back

136   Social Security Advisory Committee, minutes of the meeting held at New Court on 1 October 2008  Back

137   Welfare Reform Bill (2009) , Part I - Social security, (2) Back

138   BBC News, Welfare plan "may cause poverty", 21 November 2008  Back

139   Ev 158  Back


 
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