Work Programme contracts at 'high risk' of cancellation

22 February 2013

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22 February 2013 | Adam Leach

The failure of Work Programme providers to meet performance targets is threatening to put their contracts and financial stability at risk, according to a committee of MPs.

A report, Department for Work and Pensions: Work Programme outcome statistics, published today by the Committee of Public Accounts (PAC), included figures that put the number of successful claimants that were moved into permanent work at 3.6 per cent. This is less than a third of the Department for Work and Pensions’ (DWP) own target of 11.9 per cent, and the committee claims a key part of the problem is failure to get providers to perform.

Through the programme, providers are paid on a payment-by-results basis, which the DWP said would stop providers from cherrypicking easy cases to get back into the workforce. The committee claims the failure to hit the targets shows that this approach is not working.

Margaret Hodge, chairwoman of the PAC and a Labour MP, said: “A provider that continues to underperform could become financially unsustainable. The department must identify cases where a provider is at risk of failing and ensure there are specific plans in place to deal with this.” The committee also said if providers continued to miss targets, DWP could be forced to cancel their contract.

The DWP claimed the PAC report paints a “skewed picture” on the progress of the programme. A spokesman for the department said: “The Work Programme gives support to claimants for two years and it hasn’t even been running that long yet, so it’s still early days. We know the performance of our providers is improving. Previous schemes paid out too much up front regardless of success, but by paying providers for delivering results, the Work Programme is actually offering the taxpayer real value for money.”

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