Memorandum from the Public and Commercial
1. The Public and Commercial Services Union
(PCS) is by far the largest union in the Employment Service with
over 22,000 members and in the civil service and related areas
with over 260,000 members. PCS is an all grades union representing
members from basic and administrative grades through to senior
2. PCS particularly welcomes this inquiry
as we represent New Deal Advisers and have consistently supported
a public sector run and delivered New Deal since it's first pilots
in 1997/8. As our evidence to the Sub-committee's inquiry in the
Employment Service in 1999 made clear we welcome the change of
emphasis the New Deal has given the Employment Service giving
it a "service rather than policing" culture. However
PCS does have some specific concerns, many surrounding the private
sector delivery of the New Deal.
How successful has the New Deal for Young People
been in moving clients into sustainable employment?
3. Obviously for the New Deal to be considered
a success it has to deliver real sustainable jobs. When the New
Deal was first introduced New Deal Advisers were encouraged to
take a long-term view of the clients needs and aspirations. The
emphasis was on tailoring the programme to suit the individual
with a goal of delivering sustainable employment.
4. However, PCS is concerned that the introduction
of new targets in the Employment Service does not support the
emphasis on job sustainability. The new targets include individual
job placing targets for New Deal Advisers (Core Performance Measures
A and Employment Service APA 1). The emphasis appears to be on
any job outcomes, rather than finding the right career path for
the individual. Many New Deal advisers are concerned that short-term
job placing has overtaken the initial long-term approach since
the introduction of the new targets. This means in practice that,
for example, the use of the Full Time Education and Training option
can be discouraged in favour of a potentially short-term job.
Clearly a training course can often be more beneficial in the
5. Many of the New Deal courses are not
traditional "student" coursesthey are practical
computer courses, admin courses etc. The benefit of this option
to the client is that previously an individual would not be able
to claim benefits while training so many were excluded from training
for financial reasons. PCS is concerned that it is a short-term
policy to discourage use of this option.
6. Generally New Deal "churn"
arises when clients are pushed into short term employment without
prospects, ie we see the same people over and over again. The
Employment Service are piloting targets on sustainability, and
sustainability features in the payment to contractorshowever
in many cases three months is too short.
7. PCS believes to overcome this problem
where should be more flexibility in certain circumstances for
clients to remain on both Gateway and Options longer than the
prescribed times. New Deal Advisers have described to us the inflexibility
of the Gateway as a major problem for them trying to do their
jobs. For example, a well documented problem is the availability
of training coursesat many times during the year several
courses (which may be of benefit to a particular client) are not
available. If a client's Gateway falls during a period like this
then he or she may be forced to do something inappropriate, again
leading to "churn".
8. Furthermore, clients with severe problems
such as drug related problems fall into a particular trap as they
are unlikely to solve these problems within a short timescale.
Again, sustainable employment is unlikely without flexibility
in these cases. We would recommend that Local Office Managers
are given authority (written into a guide reference) to grant
flexibility in certain deserving cases. In many ways the compulsory
nature of the programme can reinforce all these problems.
9. For people with disabilities, work preparation
is an excellent routeway to a sustainable job yet it is not allowed
during Gateway or from New Deal budgets. Disabled People's are
being disadvantaged before and during New Deal for the reasons
stated and because there is not enough money in the rehab budget.
What have been the key factors influencing the
New Deal successes and failures?
10. The PCS believe that the main factor
influencing the success of the New Deal is the quality and experience
of the Employment Service New Deal Advisers. This has been recognised
by many, including ministers and the Employment Select Committee.
Recommendations to continue this high level of achievement include;
A review of caseload sizes to allow
staff to do a thorough job with each client. Again, NDA's have
reported to PCS that caseload sizes are a major problem for them.
This has been reported to the Employment Service management at
several meetings and they have promised us that they are doing
something about it. We have yet to see any proposals for change.
Staff turnover has been identified
as a major problem. To deal with this the Employment Service management
need to look at the reasons for turnover. Some suggestions are:
a return to a client focused
approach rather than one based on targets;
a comprehensive review of the
development and increased pay
for NDA's needs to take place; and
as (previously mentioned) increased
flexibility would go a long way to empowering NDA's to achieve
sustainability and reduce staff turnover.
11. We should also make the point that the
Employment Service's advisory resource does not allow support
in employment that is offered by external contractors on New Deal
and ONE. In addition New Deal advisers must be allowed to get
out also to monitor the employer and other options.
12. In areas of high unemployment, it is
often the case that job availability, training availability and
other key problems such as drug abuse influence the performance
of the new Deal Unit of Delivery. Performance targets and analysis
should take account of these particular problems. Performance
should be measured across the country and it should be recognised
that some areas will not perform as well as others. That is not
to say that best practices should not be shared across the country.
However, it is wrong to suggest that some Units of Delivery, such
as in the North East, are performing worse than others given the
state of the Economy in those areas. Many of the jobs available
in these areas are part-time, short term and low paid vacancies.
It is therefore no surprise if sustainability of jobs is affected
or if more people chose the Full Time Education or Training as
an option. We would recommend a review of performance measurement
13. PCS is also concerned that some of the
failures of the New Deal can be attributed to the involvement
of the private sector, rather than the Employment Service, in
its delivery. While it is unfair to brand all the private sector
delivered areas of the New Deal as failures in PCS's view all
the private sector delivers of the New Deal have experienced at
least some difficulties.
14. The performance of private companies
in New Deal has been repeatedly exposed by the PCS. In 1998, for
example, performance figures for the PSL Pilot in Hackney and
City were appalling. For December of that year figures suggest
only 11 subsidised placings were achieved against a target of
425! In January of 1999 this Unit of delivery was 141st out of
142 in the national performance "league table", a position
which did not improve for some time. (As an aside PCS is forced
to ask why was the company involved given the contracts to run
ONE and Employment Zone pilots?) Creeping privatisation of this
nature is of obvious concern to the Union and it's membership.
15. York Consulting Limited were given the
contract for an interim evaluation into the New Deal which was
published in August this year. Although the report suggests performance
in the Private Sector Led Areas (PSLs) has improved, there is
a serious question as to whether the comparison between PSL's
and the Employment Service Led Units of Delivery is a fair one.
Indeed, the report suggests that such a comparison would be too
simplistic. For example, a rationale exists that the private sector
may offer "more innovative delivery". Unlike the Employment
Service, however, PSL's can negotiate different levels of subsidy
with employers. Examples are given where mopeds have been bought
for clients to get them to work. Speak to any Employment Service
New Deal Adviser and they would tell you that they would love
to have flexibility like this. The Union believes therefore that
the starting point for such an evaluation is not a "level
playing field", and any genuine evaluation must take account
of the unfair bias towards private companies.
16. The report by York Consulting Ltd does
not indicate the PCS that there is any added value in using the
private sector instead of the Employment Service. While they do
hail the private sector as being more responsive, having good
empathy with clients and being more "job-focused" other
papers, including those written by Ministers, have indicated clearly
that the success of the New Deal is down to the hard work and
professionalism of the Employment Service New Deal Advisers.
17. There is also a commonly held view that
the performance of the private sector would be much worse without
the current level of Employment Service support. Because of the
complicated funding mechanisms involved, the report concludes
that it is very difficult to measure the cost effectiveness of
delivery in the PSL's. Again PCS would argue that the private
sector has not demonstrated any "added value", and that
the work should therefore be left to the experts!
How effective and comprehensive has the Government's
programme for evaluating the New Deal been?
18. The suggestion that a full evaluation
of the Private Sector Units of Delivery should be welcomed. As
stated above, the PCS believe that the current published study
is limited in value. We believe that statements made by private
companies have been taken at face value and have not been independently
scrutinised. We feel that an analysis should take place of the
"added value" on the private sector compared to the
public sector and that claims of "innovation" should
be very closely scrutinised.
19. The definite impression our members
have in the Employment Service is that the Private Sector Led
Units of Delivery will be made to work and will be given as long
as is necessary to do so. Clear definitions of what "added
value" means are necessary. Value for money and costs (including
"hidden costs") should be considered and compared. In
the Employment Service there are clear processes for performance
validation. This does not seem to be the case for the Private
Sector which suggests we are not competing on a level playing
field. A detailed examination should be made into unsubsidised
How have lessons from the New Deal for Young People
informed the development of other strands of the New Deal?
20. The comment we have here is that Gateway
and compulsion have been introduced to the 25 Plus scheme. PCS
has doubts as to the merit of this, because previously the programme
may have been more attractive and therefore encouraged genuine
participation. Generally we are opposed to more compulsion. The
introduction of more targets for job placing eg for Lone Parent
Advisers may well lead to more stress for advisers and less job
sustainability for clients.
What changes are planned for the design and delivery
of the New Deal and what benefits, if any, are they likely to
21. As previously discussed, New Deal Personal
Advisers are the most important resource for the successful delivery
of New Deal. PCS has had discussions with the Employment Service
management about the pressures of work NDA's face. They indicated
to us that the Employment Service Board were alarmed by the findings
of both PCS studies of the issue and the results from the latest
Staff Attitude Survey in the Employment Service. As yet, despite
promises we have not received any formal proposals on how they
intend to deal with this very serious issue.
22. Clearly we would like to know what they
have in mind and would like to be involved in the process. This
is especially important as we are aware that ministers have taken
an interest in the role of NDA's and the pressures they face.
There should also be a review of the allowances paid to FTET clients.
Public and Commercial Services Union