making restart work - ersa · 2021. 6. 1. · making restart work tony wilson, institute director,...

Making Restart work

Tony Wilson, Institute Director, IES

[email protected]

@tonywilsonIES

ERSA webinar, 11 January 2020

Background to the Restart programme Key features and how they stack up Timescales, commissioning and

assessment What needs to happen to make this a

success?

What I’ll cover

Context – facing a big rise in unemployment (but may peak below the last crisis)

Which means long-term unemployment will also rise sharply over the next two years

Becoming unemployed leads to permanent ‘scars’ – more likely to be out of work later in life, in poor quality work, have lower earnings, worse physical and mental health, and to be less happy (Arulampalam et al, 2001; Nordstrom et al, 2014; Paul and Moser, 2009; Eurofound, 2017)

Repeat spells and long-term unemployment are particularly damaging and this has direct economic and fiscal costs – e.g. youth non-participation in education/ employment was estimated to have cost £10-30 billion in 2009, equivalent to >£50k per person (2009 prices) (Cole et al, 2010)

This isn’t inevitable – avoiding repeated spells significantly reduces the negative effects for individuals (Gregg and Tominey, 2005)

If we don’t take direct action to address long-term unemployment then the pool of available labour is also reduced – leading to a weaker recovery and risks of inflation

Long-term unemployment is bad all round –for individuals, economy and society

Doubling of JCP Work Coaches

A lot of measures have been announced in this crisis – Restart is just one of them

Job Entry Targeted Support

Increased Flexible Support Fund money

Apprenticeship hiring subsidy

Traineeships expansionKickstart

Find a Job/ Job Help service

Restart

Sector Based Work Academy expansion

Digital Bootcamps

Opportunity Guarantee

Lifetime Skills Guarantee

Increased funding for careers services

Apprenticeships levy flexibilities

Shared Prosperity Fund

Job Retention Scheme

Job Support Scheme

Focused on long-term ‘claimant unemployed’ –which will shoot up in coming months, as 1.5 million signed on in spring last year

1999-2010 – New Deals• Adviser-led ‘Gateway’ support with referral to ‘Options’ – hiring subsidy,

training, volunteering

• Private Sector Led model tested outsourcing of gateway services, while Employment Zones allowed for more ‘black box’ approach

2008-11 – Flexible New Deal• Contracted-out, adviser led model with more flexibility on design but

requirement to offer full-time activity

2011-2018 – Work Programme• Contracted-out, adviser led, ‘black box’ model, highly outcome based,

serving jobseekers and those with significant health conditions

Range of evidence on what works – and what doesn’t – that Restart seeks to build on

Restart design – building on 20+ years of support for long-term unemployed

Eligibility will be limited to those continuously claimant unemployed for 12 months or more – with limited to scope for early referral

One year of support on the programme –shorter than the Work Programme (two years), in line with FND

Up to £2,000 funding per participant – far better than the average £1,400 spend per participant on Work Prog (for two years’ support)

Clear guaranteed service levels – fortnightly contact, monthly meetings, action plan, access to personalised support

Three year contract duration – with option to extend by up to two more

One job outcome measure – cumulative earnings of approx. £3,700; no focus on job quality or progression

Payment by Results – 70% of contract value tied to these outcomes, with 30% paid as ‘delivery fee’

Expectation that 25-33% will achieve this – based on HMRC/ DWP data matching; but sensitive to strength of economic recovery

‘Price Accelerator’ for performance above 21% - to try to incentivise higher outcomes

Key features of Restart

Common ‘Customer Service Standards’ (eight in total):• Face to Face initial meeting (70% must be achieved and recorded w/in

15 working days)

• One-to-one support at least fortnightly

• Face-to-face meeting at least four-weekly

• SMART Action Plan within eight weeks of referral; and updated at least every four weeks

• Diagnostic Assessment within eight weeks of referral; updated at least every four months

• High level of customer satisfaction (survey based measure)

Clear expectations around delivering personalised, tailored and work-focused support

Emphasis on local partnership working and employer engagement Sanctions dialled right down compared with previous LTU provision

Higher degree of prescription than Work Programme – a ‘grey box’ model

Twelve ‘contract package areas’ – one provider in each (no competition/ choice)

CPA 2aAreas covered: North East, Humberside,

parts of North Yorks (incl York)Shortlisted: Adecco, Capita, Ingeus,

Maximus, People Plus, Pinnacle, Reed, Serco

LEPs: 5 (one shared with 2b)Maximum contract value:£217 million

CPA 3aAreas covered: North West excluding

Greater ManchesterShortlisted: Adecco, Capita, Ingeus,

Fedcap, Maximus, People Plus, Reed, G4S

LEPs: 4Maximum contract value: £218 million

CPA 2bAreas covered: South and West Yorks;

Notts and DerbyshireShortlisted: Adecco, Capita, Ingeus,

Maximus, People Plus, Pinnacle, Reed, Serco

LEPs: 3 (one shared with 2a)Maximum contract value: £292 million

CPA 3bArea covered: Greater ManchesterShortlisted: Adecco, Capita, Ingeus,

Fedcap, Maximus, People Plus, Reed, G4S

LEP: Greater ManchesterMaximum contract value: £172 million

CPAs in a bit more detail – North, North East and North West

CPA 1aAreas covered: West Mids CA; Worcestershire, the Marches

Shortlisted: Adecco, Maximus, Reed, People Plus, WISE Ability, Pinnacle,

Serco, Jobs 22LEPs: 5 (2 shared with 1b)

Maximum contract value: £252 million

CPA 1bAreas covered: Potteries, Warks, Lincs,

Leics, SE MidlandsShortlisted: Adecco, Maximus, Reed, People Plus, WISE Ability, Pinnacle,

Serco, Jobs 22LEPs: 7 (4 shared with others)


CPA 4aAreas covered: West Country and

South WestShortlisted: Capita, People Plus, Pinnacle, Serco, Ingeus, Reed,

Fedcap, Seetec Pluss LEPs: 6


CPA 6Area covered: Wales

Shortlisted: Adecco, Capita, Fedcap, Serco, Jobs 22


CPAs in a bit more detail – Midlands, South West and Wales

CPA 5aAreas covered: Outer London – South,

North and EastShortlisted: Ingeus, Maximus, People

Plus, Pinnacle, Reed, Serco, G4S, Shaw Trust

LEP: LondonMaximum contract value: £234 million

CPA 5bAreas covered: Central and West

LondonShortlisted: Ingeus, Maximus, People


LEP: LondonMaximum contract value: £349 million

CPA 5cAreas covered: East of England, Kent,

East SussexShortlisted: Ingeus, Maximus, People


LEPs: 4Maximum contract value: £332 million

CPA 4bAreas covered: Thames Valley, Oxon,

Bucks, Solent, W Sussex, BrightonShortlisted: Capita, People Plus, Pinnacle, Serco, Ingeus, Reed,

Fedcap, Seetec Pluss LEP: 7 (3 shared with others)


CPAs in a bit more detail London, South and East

Timetable:• ‘Commercial Dialogue’ responses – 25 January• Commercial Dialogue sessions to 26 February• Final Offer responses – 15 March• Contracts awarded – 7 May• Go Live – 28 June

Maximum of two CPAs per prime – so at least six providers in total

65% of bid score will be linked to quality criteria 35% linked to a combination of price and performance offer

Commissioning and procurement

Rollout will take time – demand will outstrip supply until at least spring 2022

Quality assessment – 65% of total Five criteria weighted as follows:

• Service delivery – incl personalisation/ meeting needs (25%)

• Participant engagement – incl caseload sizes and approach (25%)

• Stakeholders and local integration – incl employers (25%) *

• Performance rationale – incl collaboration (10%)

• Social value – incl staffing and supply chains (15%)

Maximum score 7, pass mark is 5 Price/ performance – 35% of total

• Formula produces a ‘Financial Evaluation Metric’

• Lowest FEM gets 35%, with other bids then scored proportionately

• DWP’s expected performance range 25-33%, max unit cost £2,000

* At ‘final offer’ stage this question will be CPA specific and only assessed by two CPA representatives

Assessment criteria in more detail

Based on detailed DWP analysis which looks robust Key is this graph, matching with HMRC data to show the % of

equivalent claimants achieving equiv. earnings over 2014-19

How plausible is the 25-33% performance range?

Shows that 30% of those who reached 12 months claimant u/e 2014-19 achieved the earnings outcome over following 18 months…

… Falling to 25% of those who reached 18 months claimant u/e

2014-19 economy was ‘stable’ – so outcomes higher than you’d expect in a downturn but lower than in a recovery/ expansion

On other hand, the fall-off in outcomes between the 12 month and 18 month group is significant

This table shows DWP estimates of how the 25-30% range would play out in different scenarios – giving range of:• 17% as lowest outcome rate for 18 month group

• 38% as highest outcome rate for 12 month group

Weighing up the strength of the economy vs. the level of disadvantage in the caseload

I think early years most will be 15-18 months and the economy will be ‘Recovering’ or ‘Expanded’…

… With later years seeing most/ all referred at 12 month point

[Note too that ‘furlough’ time isn’t counted – so some may have been out of work a lot longer]

Risk is that if everyone scores high on quality it will just come down to the price/ performance metric

Linking of price and performance is intended to encourage providers to find a ‘sweet spot’ between job outcomes and price discount…• But does the ‘Financial Evaluation Metric’ incentivise one over

the other?

Table on next slide gives the range of outcomes Can read this either way, but does appear to bias a bit more

towards price than performance DWP needs to set a price floor (e.g. £1,600) to avoid

gaming with extreme discounts and mediocre performance

Will this just end up a price-based competition?

FEM scores: 30% outcomes with 10% discount beaten by 25% performance with >17% discount

Scoring a 7 (maximum) on one of the main three quality marks increases your total score by 4.6% compared with scoring a 5 (pass)

So if a ‘lowball’ bidder wants to win on cheap mediocrity, can they beat a more costly but higher quality bid?

This next example assumes a lowball bid of 28% performance with a 25% discount, and is potentially worrying…

Another way to look at this is whether you can ‘make up’ ground lost on quality

Example: If you offer 33% o/cs and 10% discount, the ‘lowball’ bid [28%/25%] needs to drop 8 pp on quality score to lose…

There’s a lot to like about Restart• Evidence based design

• Clear service standards

• Focus on quality, service, partnerships, outcomes, sustainability/ longer term impact

• Good commissioning model

But it will take time to build, and clearly some areas for improvement – in particular on job quality and the need for a price ‘floor’

As ever, all will depend on the quality of the bids/ offers; ensuring those are delivered; effectiveness of local delivery; fit with range of other provision; how we learn, share and improve

In summary…

This is a fantastic opportunity – once in a generation Clear that DWP want high quality, outcome-focused offers So what would good like? I think five key factors:

• Focus on the individual – personalised support; frequent contact; access to wider services; and (in my view) specialist caseloading and advisers

• Focus on partnerships – particularly with local govt, skills, employer bodies. Co-designing and co-funding local/ sector esponsive support

• A different approach to employer engagement – partnership, not just matching and brokerage

• Stretching on outcomes, not cutting costs

• What works and collaboration – plan, deliver, review, share, improve…

Making Restart work is in our hands

Any questions/ views (and howlers)? How can we best make this work? What needs to look different for different groups,

areas? How do we support partnership formation over the

next few weeks? Can we better support employment progression? How do we collaborate, share and improve?

Over to you!

Making Restart work

Tony Wilson, Institute Director, IES

[email protected]

@tonywilsonIES

making restart work - ersa · 2021. 6. 1. · making restart work tony wilson, institute director,...

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