at the sharp end: Flexible NeW Deal
Making a
Will the government’s Flexible New Deal be enough to stem rising unemployment in the wake of the recession?
new deal
he strategy is in place, yet the scale of the problem remains unpredictable. Flexible New Deal (FND), the government’s plan to tackle long-term unemployment, goes live this autumn, but no one knows how many jobless people it will have to cater for. Under FND – which the government hopes will find jobs for 200,000 annually – claimants out of work for 12 months or longer will be referred to private contractors who’ll be paid by results to find them work. Will it succeed? Will there be enough money? Recently, MPs on the Work and Pensions select committee said that with FND now facing demands from three times more applicants than first predicted, current funding arrangements were ‘inadequate’. And there’s another key question: will private contractors strive to find jobs for challenging groups such as the disabled?
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will work for the individual – they don’t have to go through set routes and procedures.’ At last year’s Housing Corporation annual conference held in Leeds, Simmonds welcomed the bid by housing associations to run contracts under FND and called for more to become involved as mainstream partners in tackling unemployment. It’s that sort of creative approach he sees shaping the future. But he fears for deprived pockets of Britain yet to recover fully from the last recession. ‘We think there should be an active job creation programme,” he says. ‘One way forward could be to create green jobs.’ These cover a multitude of things: clearing polluted brownfield sites; tree planting; creating renewable sources; home insulation. ‘We’ll come out of recession with a greater emphasis on the green economy,’ he says. ‘People will be in positions to pick up those jobs in the future.’ Simmonds believes strategic local partnerships will determine sources of employment. ‘It need not necessarily be green jobs,’ he explains. ‘In some areas there maybe a real shortage of social care – or in media and design around areas such as BBC’s media city in Salford. ‘We mustn’t get hung-up on the assumption of creating shovel-ready jobs – manual and low-skilled. These aren’t appropriate for a lot of people such
Everyone agrees that no single solution can be imposed from on high. Imagination is needed in a recession
Everyone agrees that no single solution can be imposed from on high. Imagination is needed in a recession. ‘Provision must be localised to meet concentrations of worklessness [sic],’ says Dave Simmonds, Chief Executive of the Centre for Economic and Social Inclusion (Inclusion). He welcomes FND, though would like to have seen it introduced three or four years ago. ‘Old New Deal has a strict menu and structure through which people had to move,’ he says. ‘Under the Flexible New Deal, providers can do anything they think as those shaken out of the finance industry, or the back-room people such as those in call centres.’
Creating strong partnerships
Matthew Nicholas, Director of External Relations at Jobcentre Plus, believes local partnerships are improving, though their standards remain uneven. The partnership in Birmingham, established after the collapse of MG Rover, is, he says ‘a strong one... where people have been working together for some time’; though elsewhere in the
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The Flexible New Deal goes live this autumn – but how many jobless will it have to cater for?
blueprint summer 2009
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at the sharp end: Flexible NeW Deal
The aim is to get people back into work as soon as possible.
Business Link, and financial support. Our aim is to try to minimise the numbers of people getting to the point where they’re eligible for Flexible New Deal – we want to do everything possible to get people back into work as quickly as possible.’ Meanwhile, he’s encouraged that major companies such as Tesco, Asda and McDonalds have expressed their willingness to give the long-term unemployed a chance.
Investing in the future
One dilemma is how best to allocate a finite pot of government money. Simmonds and Nicholas agree on the need to invest in both the short- and the long-term unemployed. But after 12 months, when people get taken on by private providers, what then? Simmonds remains worried that contractors will be tempted to spend money getting people into jobs who are easier to place. Safeguards are needed, he says. ‘The challenge and the danger created by the most disadvantaged is that they’ll get the least resources precisely because the provider has assumed they won’t get a job. The government needs to incentivise private providers in the right way and lay down the standards they expect. They’ve gone some way on that, but this has to be kept constantly under review. It’s a market you have to regulate.
country, some ‘are more fragmented.’ Many people have been dismayed by the closure of Jobcentre Plus offices, a trend only recently halted by work and pensions secretary James Purnell after more than 50 had shut down since 2002. According to research by the Conservatives, the number of unemployment benefit claimants more than doubled from January 2008-09 in 38 constituencies where Jobcentres had vanished. Nicholas doesn’t anticipate centres reopening or new ones appearing on the high street. But nor do closures result in the unemployed being cut-off. ‘So much of what we offer is 24/7 with the internet, where all jobs are advertised,’ he says. ‘Telephone services are available for longer hours to help. ‘A key role of centres will be to accommodate those who want more time with advisors. We’re also trying to get advisors co-located where it makes sense, such as at Pathways to Work centres for the disabled.’ Simmonds agrees that the phone and the internet have changed things. ‘But I don’t think they’ve developed those systems fast enough,’ he says. He feels the physical presence of a Jobcentre remains important. ‘Modernising things and making it easier for individuals is good, but when people become unemployed it’s an isolating experience. You want to meet and talk to someone.’ The signs are that more of this will happen. Nicholas says DWP is recruiting around 1,800 people a month to deal with the swelling demand for benefits and employment advice. ‘We’re increasing what we offer people one-to-one,’ he says. ‘From the beginning of April, people who have been out of work for six months – pre-flexible new deal – have been able to spend more time with an advisor.’ ‘We’re also offering extra help for people wanting to set up their own business, such as advice through
Many people have been dismayed by the closure of Jobcentre Plus offices
‘Private sector providers must be seen to deliver good results in a way that doesn’t entail parking people and taking excessive profits. I’m convinced they’ll deliver, but it’s a big challenge in times of recession. It will require different ways of working and flexibility by everyone concerned – providers, government and other organisations.’ Nicholas is optimistic things will develop organically to this end. ‘With Flexible New Deal, we’ll be responsible for a continued relationship with private providers,’ he says. ‘Getting the longterm unemployed into work has always been a difficult balance. But I understand there was a strong message from provider partners: “Don’t overengineer us – we will take account of all the people sent to us”.’ With that expression of intent, Nicholas hopes providers won’t ‘park’ the more challenging cases, such as those with disabilities, and concentrate on easier returns. ‘We’ll be looking at the system to make sure there’s no evidence of creaming,’ he says. ‘There’s now a more natural relationship based on common objectives – more co-operation between ourselves, the provider community and local employment partnerships.’
WHaT’s THe Deal?
During its 10 year history, New Deal helped more than 1.8 million people into work. The Flexible New Deal has five core principles: l Transforming ‘passive recipients’ into active jobseekers; l A personalised approach; l Innovation through partnership working; l Enabling communities to produce sustainable jobs; and l Creating employment that allows people to develop skills and progress.
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