Tuesday, 22 July 2014

The sanctions report

Matthew Oakley's report is out.  You can read it here.  His brief was to look at how the sanctions system was working amongst certain groups; in particular at the communications with, and understanding by, claimants.  It was said from the beginning that the remit was far too narrow, a cosmetic exercise to justify the DWP but ignoring the real issues.  And it was said that Oakley was the wrong person to do it.  If you read the Foreword to the report you do get the impression that Oakley dutifully applauds the system.  But in fact he has gone beyond his brief, and there are some very important points in the document.
The Financial Times wrote a fair piece, highlighting the poor way in which the DWP communicates with claimants who have been sanctioned.  They also got a quote out of Esther McVey: "I have already started to make improvements ..."  Far be it from me to call anyone a liar, but I doubt that this is true.  The Guardian went with the fact that "Benefit sanctions hit most vulnerable people the hardest", sending out unintelligible letters, and not telling people about the availability of hardship payments unless they asked.  There's also a very significant observation from the report: "It also revealed serious flaws in how sanctions were imposed, with Work Programme providers required to send participants for sanctions when they knew they had done nothing wrong, leaving 'claimants … sent from pillar to post'".  This is the first time I've seen this fact in print.  The Guardian produced an update on this article this evening to take account of the fact that the government is to "overhaul the way it treats benefit recipients threatened by sanctions".  This must be based on the DWP's press release, which doesn't use the word overhaul and promises very little.  It does provide a quote from McVey which is probably made up by the DWP Press Office.  (You can play meaningless platitude bingo with it.)  The BBC website has a very careful piece which isn't worth reading.  And from Iain Duncan Smith, not a peep.  
This report is, of course, far from sufficient.  As the TUC has said, there must be a much wider review into the sanctions regime.  Perhaps it should look at this case reported today in a Hertfordshire local paper.  It's as bad as it gets.

Monday, 21 July 2014

Changes at A4e

We knew that various directors of A4e had come and gone, having done their stints on the board.  However, separately from that, Mark Lovell has gone.  His job was terminated at the end of May (yes, I know it's July now, but I've only just picked it up.)  He had been with A4e since the start in 1991, and there were those who said that he was the brains behind the business rather than Emma Harrison.  Lovell kept a low profile, in contrast to Ms Harrison, and I only remember seeing him on TV once.  He was Executive Chairman of A4e for over 22 years, but in September last year he stepped down and became a non exec director.  He's now become the principal of something called The Social Assistance Partnership.   So all the old guard has gone.

There could be some new business for A4e if the Conservatives win in 2015.  The "think tank" Policy Exchange, which is actually a Tory brand, wants to privatise jobcentres.  There's a useful article in the Belfast Telegraph, and another on the Huffington Post site.  The service would be split and the "employment services arm" privatised while the rest would be renamed Citizen Support.  It's inevitable that any service still in the public sector will be outsourced sharpish if the Tories get in.

Thursday, 17 July 2014

Carrying on

On the day of the reshuffle the DWP put out its independent report into the way the bedroom tax is working.  It's a process known as burying bad news.  But it was noticed, particularly by the Liberal Democrats, who decided that it was just too bad to defend any longer.  And it's that, unfortunately, which has been the news story, rather than the contents of the report itself.  Let's skip the politics and look at the facts.
You can read it all here - "Evaluation of Removal of Spare Room Subsidy".  There's a lot of it, so you might like to copy most of the media and just look at the Key Findings from page 15.  Crucial is the fact that only 4.5% of affected claimants have moved "within the social sector" in the first 6 months of the reduction, with another 1.4% moving to the private rented sector.  There's nowhere to move to.  Most people said that they had done more to find work or better-paid work (well, they would, wouldn't they?) but hardly anybody had taken in a lodger.  41% of tenants have paid the full shortfall, 39% have paid some, and 20% have paid none.  Where have people got the money to pay the extra?  57% say they have had to cut back on essentials (like food) and 26% had had to borrow money.
And on it goes.  The RSRS (as the report calls it) is a massive failure, as everyone except IDS and Freud predicted, and all it has achieved is to plunge poor people into greater penury.  The BBC got a quote from Iain Duncan Smith: "This department is delivering some of the biggest welfare reforms in over 60 years, designed to return fairness to the system and we are on track to make the £6bn savings we had previously set out.  At the same time we are helping to make sure our housing benefit reforms have a transformative effect on the lives of those who in the past were faced with a system which trapped people into cycles of workless and welfare dependency.  The scaremongering by those opposed to our welfare reforms - in particular our housing benefit reforms - has been proven to be without substance, and we are already seeing the effects of people moving into work."  The risible DWP Press Office chaps tweeted desperately in similar vein.  But the Lib Dems decided that they couldn't defend it.

There was some barely-noticed news on the outsourcing front.   The contract for electronic tagging of offenders, previously held by G4S and Serco (both of which were found to have defrauded the taxpayer of millions) has gone to - wait for it - Capita!  Some asked why Capita; why does it always have to be these three?  But it's an inevitable part of the outsourcing business.  If you create huge contracts only the big firms can bid, and it was these three which were prepared to bid for everything.  
One lot of contracts of interest to many is Community Work Placements.  But CWP doesn't seem to be going well.  The Boycott Workfare team is doing a great job of publicising companies and organisations which agree to take part by taking free labour.  One was recently claimed by the government as a success, providing a photo-op for Osborne.  It quickly decided to withdraw when it discovered the trouble it was attracting.  It looks like the CWP contractors are targeting councils and housing associations for placements, if Seetec is anything to go by.  They say, "Examples of such projects include estate maintenance and local renovation, groundswork, horticulture, recycling as well as administration, customer service and sales, warehousing, distribution and cleaning services. The list of potential projects is almost endless."  Sadly, it will be tempting for cash-strapped councils to go for this.  Presumably they can adapt the hi-viz jackets they use for Community Payback offenders on similar projects.

Tuesday, 15 July 2014

He stays

Yes, Iain Duncan Smith keeps his job.  The BBC seems not to have noticed this.

So why is he still there?  Political Scrapbook has two theories: one is that they didn't want to justify the supposed leak of his demotion by a Spad on a train; and the other is that anyone else taking on the job would have to admit to the grave problems with UC, so best leave it alone.  I have another theory - that he stays put because he's doing what Cameron wants him to do.  Michael Gove went to great rejoicing in every school staffroom in the country; teachers vote, and some might vote Tory.  IDS would have gone to exultation among the poorest - who never vote Tory.
Esther McVey keeps her job too (and a seat in the cabinet, which is meaningless) but Mike Penning has gone.  He had shown far too much compassion for the disabled and contrition for the Atos mess.  So there now isn't a minister for disabilities, but Mark Harper comes in as Minister of State at the DWP - not sure what that means.  Harper is a youngish right-winger.  That seem to be the main theme of this reshuffle.  All the moderates have gone (I don't count Gove in that) and a firm right-wing stance is set for the rest of this government.

There are things to say about the bedroom tax report and about Capita, but we'll leave that till tomorrow.

Saturday, 12 July 2014

Why Iain Duncan Smith should go

Someone yesterday started a story of a conversation supposedly overheard on a train to the effect that in the forthcoming reshuffle "Ian" was to be replaced by "Esther".  Despite there being no substance to this story at all it's made it as far as the BBC website.  One thing that this demonstrates is that Iain Duncan Smith's future is the biggest talking point in the reshuffle.  Will Cameron move him?  Will he have the guts to fire him if he refuses to be moved?  Who would replace him?

I have blogged before about IDS's failures, as have a great many people.  There's an excellent piece on the Labour Left website which lists "Iain Duncan Smith's 100 biggest failures".  It's a heroic effort, well worth study.  But let's distil it into the most obvious areas where his ambition has far exceeded his competence.

  • The Work Programme.  This was the first of IDS's grand schemes to be put in place.  It was going to solve unemployment; and the most revolutionary aspect of it was "payment by results".  But it was never that.  The providers were guaranteed an "attachment fee" which would keep them going if they did nothing; and they were able to look forward to an "incentive" payment even if they failed badly.  And fail badly they did.  After 4 years it's clear that job outcomes (below even the minimum performance demanded and way below the providers' promises) depend on the economy and not on anything the companies do.  Helping to drag down the WP is:-
  • ESA.  The companies were never going to be able to help those on ESA into work.  Indeed, most have been parked.  And overall, the companies have spent less than half the amount per client which they promised.  Remember, they get contracts because of the promises made in the bid documents.  And now they've got contracts to scoop up the people they've failed into:-
  • Community Work Placements.  Okay, these appear not to have actually started yet.  But that's because a huge chunk of the voluntary sector want nothing to do with them, and a growing number of councils have also refused to take part.
There were a number of other, almost incidental, schemes along the way which have also been disasters, notably
  • The bedroom tax.  (Let's face it, no one was ever going to call it "the removal of the spare room subsidy".)  It has cost councils a fortune, saved no one any money and inflicted huge distress and misery on thousands.
  • Universal Jobmatch.  This was, it seems, entirely IDS's baby.  A grand one-stop-shop for employers and jobseekers alike which would have the added advantage of monitoring the activities of claimants.  The contract was given to a company with a poor record but which claims that much of what went wrong with UJM could have been prevented - but they were told not to put the necessary refinements into the software.  The system has been used to control and punish claimants without ever being the wondrous solution IDS envisaged.  But its costs are enormous.
  • The sanctions regime.  A ludicrously impractical "claimant commitment" has been coupled with a vicious imposition of punishments which breach people's human rights.  Yet time and again IDS and his ministers have simply lied about sanctions; McVey repeated again this week in Parliament that they are "a last resort".  The human cost is appalling.  
The biggest failure of all, however, is:-
  • Universal Credit.  This was to be the lasting legacy of Iain Duncan Smith, transforming "welfare".  At the outset opposition parties said yes, great idea, but it's never been done because it's too difficult.  Not for IDS, though.  Millions have been spent on IT that didn't work, more millions on trying a different IT system, and on patching up the problems thrown up by the very limited trials of UC.  We needn't rehearse all the problems.  But through them all IDS has insisted that it will all be fine.
We're told that it's Osborne who is keen to get IDS out because the Chancellor wants to slash the welfare budget and IDS resists that.  We're also told (in the Mail today) that Smith will again refuse to go.  This man's failures have cost us dear.  Surely he must go.

Tuesday, 8 July 2014

The boom in outsourcing

£88 billion has been spent on outsourcing in the UK since 2010.  That's nearly double what was spent in the last four years of the previous government, and the public sector is outsourcing at twice the rate of the private sector.  The big winners have been Capita and the usual suspects, but little of this boom seems to have touched A4e.
The project has enable the government to claim spurious private-sector job creation, as workers are switched from one to the other, with fewer jobs remaining at the end of it.  It also enables Cameron to claim that he is fulfilling his pledge to "release the grip of state control", though this begs the question of exactly who is in control.  Time and again we see how poor the procurement process is; how promises made on tender documents are pure fiction, but there is no come-back for the taxpayer.  There's an excellent analysis of the Work Programme figures in the New Statesman.  The providers are spending nothing like the amount per client that they promised, yet still they get their incentive bonus.
There is evidence that some services outsourced by local authorities are being brought back in house, and we've seen that happen in the past.  But there comes a point where there's no "in house" left; no council or government structure to administer the service.  It was a creeping privatisation under Labour.  It's galloping under this government, with little notice being taken by commentators of where we're going.
For a little light relief, we're told that a cabinet reshuffle is on the cards for next Monday.  It's suggested in the Telegraph that there are rumours of a straight job swap between Iain Duncan Smith and the Defence Secretary Philip Hammond.  The mind boggles.
 

Wednesday, 2 July 2014

Work Programme puzzle

It started with a statement from the redoubtable Margaret Hodge MP, chair of the Public Accounts Committee.  She is angry at the failure of the Work Programme to help the people it was supposed to help, especially those on ESA.  There has been no improvement, she said, since the PAC examined it in 2012, and providers are spending only 46% of what they were meant to spend supporting each client.  Then comes the puzzling bit: "It beggars belief that the Department expects to pay at least £31 million in bonuses to all of its contractors despite their poor performance - even the Newcastle College Group whose contract has been terminated will receive a bonus."
I confess to never having heard of these bonus payments.  There was little enlightenment from an article by Rajeev Syal in the Guardian.  He adds some more figures, but gives the bonus as £25m (and then £31m), while calling it "incentive payments", and saying that the National Audit Office "has discovered that flaws in the work programme contracts meant that the [DWP] is obliged to make incentive payments to even the worst performing providers."  The figure isn't dependent on results.
Still confused, I looked at a piece from Sky News.  It's clearer.  And there's an interesting paragraph: "Figures for the most recent group to have gone through the scheme showed just 32% of participants found jobs - still below the DWP's minimum performance level of 33% and well below its original forecast of 39% and the 42% predicted by the contractors themselves."
Newcastle's local Journal tells us that NCG's contract in North East Yorkshire and the Humber had a success rate of 7.4% - but they're going to get a bonus anyway.
Okay, I must have missed the bit about bonuses when these contracts came out.  Perhaps they were negotiated at the same time as the "attachment fees" which meant that the providers would have a steady income and wouldn't be dependent on PbR.  But they are certainly a comfort to A4e and the rest.