Saturday, 25 February 2012
The Work Programme, Emma Harrison and employment subsidy myths
Today it's all about the Work Programme and Workfare and troubled A4E's recently resigned Chair Emma Harrison. It seems everyone has a point of view, as do I. Readers will know I have been writing about the Work Programme and more especially the Future Jobs Fund (FJF) that it replaced for some time.
Our organisation, Social Enterprise London, was paid £6,000 by the government to deliver each FJF work placement in social enterprises, with most of that money going to the employer to pay the employee. We worked with 164 social enterprises to create 500 jobs for six months and at the end of the programme we found that around 69% of our young people were no longer claiming benefits, with the vast majority still in their placements which their enthusiasm and diligence had helped turn into 'proper' jobs. Our programme had carefully worked with employers, interviewed the young people and matched them with mentors to help them, which sounds a lot like Deborah Orr's suggested course of action in her piece today, "The slanging match over Workfare is getting us nowhere."
I have also read some nonsense this morning that subsidising employers to take on new employees is akin to Stalinist market manipulation. We know that in a flat economy employers lack the confidence to take on new staff. When a subsidy is offered, they have nothing to lose; when the subsidy runs out, but the job still seems necessary and profitable, they will retain the post at their own expense. In this way jobs can be created.
Alternatively you could pay a third of the cost of FJF to companies that can still afford massive dividends for their principle shareholders to shuffle folk from training course to unpaid placement where the employer barely has to open an eye at the nameless, faceless procession of de-motivated unemployed who don't want to be there, and whom they don't really want. It would be useful to be able to look at how the placement/jobs rations are working with the Work Programme, but we aren't yet privy to those numbers yet.
The fundamental differences between our approach and that of a shareholder-driven company are where incentives lie. SEL wanted to create a new generation of social entrepreneurs, our members wanted to inspire and assist young people and the young wanted to work for ethically driven companies. That is why it worked so well and why having profit-driven monoliths working through canny incentive schemes will inevitably lead to abuse but, more importantly, to very little of the magic of getting someone in trouble back on track.
Reducing unemployment has to be our top priority if we are to pull the economy out of the danger zone. Otherwise we will have legions of so-called "problem families" with hundreds of Emma Harrisons needed to administer to their expensive anti-social under-achieving.
The letter, printed today in the Guardian, from Paul Harrod of Bristol Together, Adam McMeecham from Restore Trust and Paul Tipler from Aspire sums up the frustrations from the social enterprise world and those of us who want to demonstrate how useful social enterprise is in getting the unemployed in to jobs but are excluded from the Work Programme because we are too small. Our letter writers tell us that their "organisations create full-time jobs for ex-offenders and ex-homeless people ... yet ... do this with virtually no help from the Work Programme. We cannot understand why the prime contractors are incentivised to send unemployed people from training course to training course and yet not support those social enterprises - like ours - that are actually creating new jobs." They go on to say "it is obvious that sustainable employment reduces the risk of reoffending," and so ask "why then does the Work Programme not recognise the value of job-creating social enterprises?"
Yes, why not?