Private and voluntary sector to play larger role.

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Employment experts in the public, private and voluntary sectors are to be paid to not only help the unemployed into jobs but to keep them there.

Work and Pensions Secretary, James Purnell, announced a much greater focus on payments by results when the department’s “Commissioning Strategy” was published yesterday.

Purnell said: “The private and voluntary sector already plays a role in delivering our work programmes. I want to take this to the next level, free them from central control and allow them to innovate. Their involvement is here to stay and set to grow.

“I want to see solutions which focus on every single individual, not just the ones who are motivated to work. Increasingly providers will be rewarded when someone has been in work for at least 6 months in the first instance, rising potentially to 18 months further down the line.”

In the current system only the first three months of a person’s employment are taken into account.

According to the new strategy providers will be rewarded with longer and larger contracts lasting up to seven years instead of the current average of three years.

David Freud, who has been advising the DWP on the commissioning strategy since he was appointed as the department’s welfare reform adviser in January, said: “Contractors will be paid by results and customers will get the long-term support they need to ensure they get into the world of work and stay there.

“The new strategy also has the potential to open up a whole new type of competition in the market place, offering openness and transparency where competitors can measure each others successes. I welcome this.”

The strategy builds on James Purnell’s announcement last week that long-term unemployed claiming jobseekers allowance will have to undertake a minimum of four weeks full-time work related activity or lose their benefits from next year as part of the Flexible New Deal.

The concerns of smaller organisations and charities will also be addressed, to ensure that the department continues to utilise their expertise in helping those furthest from the labour market get back into work.

Sheila Kjaerhus