Payment by results on probation 'will reward failure', claims think tank

Adam Leach is a freelance business journalist
8 August 2013

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Increasing reoffending rates by a small degree would be easier for probation contractors than reducing them by a similar amount under the payment by results mechanism proposed by government, a think tank has claimed.

Under plans proposed by the Ministry of Justice, a portion of the fee paid to probation service providers would be calculated on the basis of performance, with those achieving high reductions receiving more money.

But, according to the Social Market Foundation (SMF), the department’s mechanism could leave weaker providers without an incentive to reduce reoffending. 

The mechanism’s baseline bracket is intended to ensure providers are not paid for improvements within the margin of error. Therefore, a reduction on a contract of 3 per cent would not trigger an increased payment, while an increase of 3 per cent would not trigger a penalty. The SMF - which welcomed the overall principle of the plans - argued the inclusion of this could incentivise providers that doubt their ability to deliver results above the threshold to simply reduce their efforts.

Ian Mulheirn, director of the SMF, said: “On these plans providers face incentives to cut frontline costs and allow reoffending rates to creep up. If they are implemented the scheme will reward failure and penalise success. Doing so would be setting the scheme up to fail for victims, taxpayers and offenders.”

Jeremy Wright, justice minister, described the claims “utter nonsense”. He added: “As the public would rightly expect, our targets are challenging: we want to see providers achieve a real reduction in reoffending, delivering long term and sustained benefits across England and Wales, and making our communities safer.”

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