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Work Programme

I know that right hon. and hon. Members will have many questions about the Work programme, but I shall start by giving the Committee a brief update before taking those questions. Committee members will be aware that the Work programme marks a significant step forward in how we operate welfare-to-work programmes in this country. We have learned lessons from what was done under the previous Government and what has been done in other countries, and we have shaped a contract that will give the long-term unemployed the best possible opportunity to get back into the workplace. I stress that the focus is on the long-term unemployed. I regard all unemployment as a challenge. I regard current levels of unemployment as unacceptably high, and as a challenge—a problem that we will have to work very hard to solve. In particular, I regard the challenge of long-term unemployment as one that should be right at the top of a Government’s priority list. The monthly unemployment figures, which we rightly look at with concern, have two features: first, the majority of those who find themselves on jobseeker’s allowance move back into work relatively quickly, but, secondly, a minority do not. They are the ones most likely to benefit from the Work programme and all that it involves, and they are right at the top of our priority list. The Work programme will provide support to adult jobseekers over the age of 25 who reach the 12-month point in their search for a job. That figure will be nine months for young people under the age of 25. Those from more challenging backgrounds—for example, former offenders or people who have been out of work for 22 out of the previous 24 months—may enter the Work programme earlier, after three months. The Work programme is different, in that we are no longer making any attempt to design from the centre. The providers that we have contracted have complete freedom to operate. They can do what works, and they can respond and adapt to best practice. That is particularly important because giving them that freedom means that they will be looking for best practice—the best ways to help the long-term unemployed. Crucially, we will pay providers only when they are successful. On the payment structure, for the first three years of the seven-year contracts, providers will receive an up-front 10% payment of their potential eventual fee, and they will receive nothing after three years. The next time they are paid anything will be when someone has been in work for six months, and thereafter they will be paid only in instalments, typically over a period of another 12 months. There is therefore a real incentive for providers not only to find employment for someone, but to find the right employment for them, because if they simply shoehorn them into any old job, the chance of them staying in it for more than 18 months is pretty slim. As well as getting people into work, a crucial part of the Work programme is making it essential for providers to deliver post-employment mentoring and support. Providers have complete freedom to operate, and the payment-by-results system goes further than any that has been tried anywhere in the world. In total, providers throughout the UK are investing £580 million of their money in the Work programme, and they will lose that money if they are not successful. That offers the long-term unemployed the best possible opportunity that we can give them of having the best support for getting into work. In Wales, we have a good mix of prime contractors and organisations working with them. We have divided the whole UK into 18 geographical areas, with two or three prime contractors being involved in each area. In Wales, there are two—Working Links, which has a long-established track record in Wales and is familiar with the challenges of the Welsh labour market, and Rehab JobFit, which is a partnership between the private sector and the voluntary and community sector. Rehab JobFit is one of our two voluntary sector prime contractors. I have been very impressed so far by what they have been doing. I have had a lot of dealings with Rehab JobFit, in particular. I have been very impressed so far by what they have been doing. I have had a lot of dealings with Rehab JobFit, in particular. My right hon. Friend the Secretary of State for Work and Pensions has been to south Wales to see the initial work that it is doing. We are optimistic; the two organisations have good ideas and the right approach to try to make a real difference to the long-term unemployed in Wales. If they are not successful, they will not be paid. They will not receive the funds that they will need to pay off their investment. There is therefore a real incentive for them to work as effectively as possible to help people throughout Wales. I encourage right hon. and hon. Members on both sides of the House to visit the two organisations and local providers, whether it is prime contractors doing the work or local organisations doing the work on their behalf. Please visit them and form a partnership with them. We Members of Parliament have an important role to play in our areas. One of the things that will determine the success of the Work programme is the way in which local employers and Work programme providers operate together in partnership. I have described the Work programme as almost a giant employment dating service. It is about finding the right individual for the right job. We can make quite a difference to small businesses by helping to remove the challenges of recruitment. An advert in the local paper may result in 250 applications or more, often, and the business will sift through them to try to find the right person. Work programme providers can do a lot of that work for the business, and can bring it a much smaller group of people to interview and choose from—people who have been re-motivated, re-energised, prepared for interview and given a sense of what the sector in question may involve. We can make it much easier for small businesses to recruit while doing the right thing for the long-term unemployed. Hon. Members on both sides of the House can play an important role by working with their local providers and their local business communities to bring the two together. Ultimately, we all share the same goal. It is all about tackling the problem of long-term unemployment, and helping those on sickness benefits who have the potential to get back into work—perhaps doing something different from what they did before—to do so. If we all work together as individuals within our communities, and really encourage and support the providers in doing the job that we all need them to do, we can make a difference, which fundamentally is what the Work programme is about. We all need it to succeed, because the human cost of it not succeeding is just too great.