Could the Welsh have the answer?

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Yesterday, I had the chance to talk to officials at the Welsh Assembly about the potential to run Community Allowance in Wales. It was really great to talk to a knowledgably official who was looking for opportunities to make a difference now for people currently out of work and the communities they live in.

Devolution enables Wales some flexibility in tackling some really difficult problems with the Welsh economy and finding creative, sustainable ways to develop new jobs. It was really interesting to hear how the voluntary sector and the Welsh Assembly are working together and their plans for the future. WCVA and DTA Wales have long been strong advocates for Community Allowance and their support has been key to securing a meeting with Leighton Andrews MP (Welsh Minister for Education and Skills) in December and my meeting yesterday.

Unfortunately welfare reform itself and the ability to tackle the benefit trap is not devolved and is a common problem across the UK.  Sadly this means attempts to develop new jobs that benefit communities and people who are unemployed are blocked by a benefit system that penalize people who work for under 16 hours. While we wait for Universal Credit ( and the debates continue on how much people will or won’t be better off) – we continue to follow up opportunities, like this one in Wales, where so many of the pieces are in place – a government determined to develop the jobs and opportunities for unemployed people and the communities they live in,  communities who need a whole range of jobs doing now and the community organizations that could create the jobs that meet the need. So watch this space – I left the meeting with a page of actions, fortunately shared with colleagues at WCVA and the Welsh Assembly and a really good feeling that the Welsh might just have the answer.

Join the campaign to grow community jobs and lets stop trapping people and communities http://locality.org.uk/projects/community-allowance/

The call for Real Jobs and Real Wages just got louder

Really great to see the excellent report from Centre for Economic and Social Inclusion (CESI) on the Future Jobs Fund and the importance of developing ‘real’ jobs and ‘real’ wages. Many of their recommendations echo the ones we have been making about the need for the Community Allowance – so that communities can create real jobs, for real wages, for people who are currently trapped by the benefit system.

The report clearly demonstrates the overwhelmingly positive impact on individuals, communities and the taxpayer if this type of approach is taken. The Future Job Fund was introduced in 2009 as a way to create temporary paid jobs for young people that had a clear community benefit. The scheme ended in March 2011, as the Government felt it was too costly.

The report argues that while the scheme was costly, an approach which includes a temporary waged jobs have real advantages:

• Paid jobs were highly valued by young people

• They resulted in young people getting jobs once the scheme had finished (nearly 50%)

• They boosted sustainable employment

• They made a real difference to the young people who needed the help the most

• They worked in areas with few jobs and low numbers of vacancies

• They worked for communities

• They worked for employees in the voluntary and private sector

CESI are calling on the Government to ensure that ‘real’ jobs with ‘real’ wages are made a key part of any approach with young people. We know that real jobs, for real wages should be a key part of all approaches to make sure that unemployed people can make real improvements to their own lives and their families.Community Allowance allows us to deal with the biggest barrier – the benefit system, and ensures thatcommunities and the tax payer also benefit.

Join us in Campaigning for the Community Allowance by clicking HERE

Pushed to the edge

As many of you know, when the current government scrapped the Future Jobs Fund and replaced it with the new Work Programme, the one thing they didn’t get rid of was the prime-contracting model.

In fact they made it even worse by requiring prime contractors to have a turnover of at least £20m. It was no surprise therefore that only two out of the 18 successful bidders were from the third sector, and of course none at all were community groups.

So, in order to deliver the national effort to help millions of people into work, we now have large corporates in the driving seat, with little in the way of a track record but a great deal in the way of maximizing shareholder profit.  As Locality’s new report Pushed to the Edge reveals, community groups with the real skills to do the work and with a real commitment to unemployed people – people they know, people who live in their neighbourhood – have been left out altogether, or at best have been fed a few scraps from the table

There is more of this to come. The government is planning to adopt a similar prime-contracting framework for a European funded programme to support families with multiple needs. There is a huge contradiction here at the heart of government: on the one hand all the rhetoric about localism and Big Society, but on the other hand, where the big money is concerned, the anti-localist privatising monopolising reality.

Last Friday, on a visit to Community Links in London’s East End, we raised this with Gareth Davies, the most senior official from the Cabinet Office responsible for the third sector. I will also be seeking a meeting with the Minister responsible for the Work Programme, and calling on the other national third sector bodies to rally together with us on this issue. Moreover I am hoping that Locality will be able to commission an authoritative analysis of the “Diseconomy of Scale”, to nail the lie that only large scale operations can create efficiencies, whereas we know from multiple experiences that localised, person-centred approaches on a human-scale are far less wasteful and far more likely to be effective in this field of work.

Thank you to everyone who has been sending us evidence on this topic in recent weeks. While it is heartbreaking to see so many community groups having to close down high quality and highly valued services, and while the vested interests in favour of prime-contracting are certainly powerful, I have no doubt that in the end this disastrous, costly, inefficient experiment will be discredited, and that it will be the voices of our movement which will bring that about.

Steve Wyler
Chief Executive of Locality

When is a job, not a job? Understanding the new “16 hour” benefit trap

When Iain Duncan Smith launched his vision of the welfare state, at the heart, was a fundamental commitment to tackle the benefit trap. He grasp the nettle and explained in clear terms how our confusing and complicated benefit system traps people – making people financial worse off if they returned to work. One of his key objectives was to get rid of the “16 hour rule” (if you work for under 16 hours a week while on benefits then for many claimants you can only keep £5 of your earnings and then every other £1 you earn is deducted from your benefit). Most people who try to work for under 16 hours a week are worse off – IDS took this on board and launched his plan (Universal Credit) for a new system that would enable people to get back into work as soon as possible even if this was only for a few hours a week – giving people a real chance to start working again without being financial worse off.

It is going to be years before the current benefit trap is destroyed by the Universal Credit reforms but just as IDS and his team start dismantling the current trap, it appears that a new and just as effective, barrier to taking up part-time work opportunities could be built and this has just as many teeth and is just as nasty…..

Next month the new Work Programme will be launched. People who are unemployed will be automatically be referred to the programme and will be offering training and support to find work. If people refuse to comply with the plan that their Work Programme provider has developed they will be subject to a range of sanctions including benefit being suspended. Activities include training courses, work placements and a range of other types of support to help people overcome barriers to employment. As anyone has tried to combine “complying” with the benefit rules and trying to work part-time or volunteering will tell you – the attitude of your employment advisor is key to whether you can make a success of part-time work, while also increasing your skills or accessing other types of support. Sometimes trying to “complying” with your welfare to work advisor means trying to be in two places at once – attending a compulsory course and going to work.

Over the last few months I have been meeting with providers of employment support to talk about the how part-time jobs in communities provides a real stepping stone back into employment – the providers have been incredible supportive and recognise how valuable such jobs could be to the people they work with…However, they have all highlighted a tension within the Work Programme – the definition of getting someone into work i.e. “getting a job” is a job of 16 hours or more a week.  The provider only gets paid for all their work if someone gets a job of at least 16 hours…. anything less isn’t counted as a “job-outcome’ for DWP – so the pressure is on the providers and people receiving benefits to make it to over 16 hours employment….

DWP have been very clear that it is up to Work Programme providers to decide the best way to get people into work. So, the real power over whether people can take up job opportunities of less then 16 hours now shifts to the Work Programme providers. Will they be able to ensure we don’t build a new barrier to work or will we see the building of a new trap that means you risk benefit sanctions and a whole lot of hassle if you take a job of less then 16 hours while on the Work Programme ?

The scary world of work capability tests

Over the next three years 1.5 million people currently claiming incapacity benefit will undergo the work capability assessment to see if they are fit to work. Soon 1,000’s of people will be receiving letters asking them to attend work capability assessments. Yet, the test has been vigorously criticised by charities such as Citizens Advice and by a government-commissioned independent review, saying that the process is impersonal, and ill-equipped to gauge the seriousness of mental health conditions, or complex medical problems.

On Monday the Commons Work and Pensions Committee held an open meeting in Burnley, to hear the views of people who have actually undergone the new work capability test. A report in the Guardian newspaper gives a powerful account of what the Committee heard and it wasn’t good.

“I just seemed to be a number. The health professional didn’t know what one of my conditions was,” one man said.

“My wife scored zero points,” another said. “The test was a total waste of time; it was all physically orientated, nothing about her mental state. They asked things like ‘Can you brush your teeth?’ How that relates to mental health issues is beyond me. It was overthrown at tribunal. I can only describe it as mental torture; she was a mental wreck after it.”

Paul Hogarth, from the local Citizens Advice Bureau, argued that the test was not fit for purpose, frequently declaring people with serious health conditions fit for work. The advice centre had supported many people to tribunals, 80% of whom had seen the assessor’s decision overturned, he said.

Kevin Nuttall, a welfare rights adviser working with Action for Blind People in Lancashire, said he had supported someone through a test which concluded that he had “mild visual impairment” and was fit for work. “He was in fact registered blind,” he said.

Others highlighted the long wait for appeals to be heard, and the impact. “I am waiting for a tribunal, but I’m told that it won’t be before June, because there are so many people waiting. I’m stuck on the £65 benefit until then,” a woman with ME said, and began to cry.

The chair, Dame Anne Begg said she was concerned about the speed with which the reform was being pushed through: “Personally, I see there are serious problem with the WCA. My view is that either they should be slowing down the national rollout or speeding up the implementations of changes to the system”

The Early Action Task Force – Guest Article from Community Links

The Goal:

To build a society that prevents social problems from arising rather than one that copes with their consequences.

The Challenge

At Community Links we know that building fences at the top of the cliff rather than running ambulances at the bottom makes sense socially and financially. Policy that supports earlier action reduces the deficit in ways that sustain positive social change. Making this case now is particularly important because:

• Change creates opportunity. Spending decisions taken at this time could begin a cycle of diminishing support for early action and increasing demand for more acute provision. This could set back the cause of early action by a generation. Alternatively, imaginatively reconfigured services can drive it forward.

• We now have a financial instrument for supporting early action. The first Social Impact Bond launched this year was over subscribed. We need to seize the moment, build the market and develop the potential.

• Ministers including the Prime Minister are apparently sympathetic. The current Allen Review can be useful but needs substance. We must hold feet to the coals.

The Response

Lack of funding in the past has constrained development, lack of development has restricted the range of tested programmes and lack of evidence has discouraged funding. We won’t break this impasse bit by bit. We need to develop the case, the funding and the delivery at the same time. The challenge is only partly practical. It is also one of understanding and aspiration. We need to capture the essence of a big goal and to build a sense of possibility and excitement. We are:

• Establishing the case: The Early Action Task Force will be launched in December. It will explore and develop the case for the early action economy publishing 3 reports over 18 months.

• Embedding Transition: A swift and radical switch of resources from acute services to prevention is impractical but incremental migration is realistic. We will be leading work on mechanisms for driving and embedding transition.

• Developing Delivery: We will launch training in the new year on “unpeeling the onion” to build the earlier action mindset and on “networked delivery” because systems can expand where organisations can’t.

Community Links has set up the Early Action Taskforce to make the case for services that prevent problems from arising rather than dealing with their consequences – services which are under threat at the moment. Things like: Advice services; Employment support; Volunteering and Mentoring schemes; Youth clubs and Community activities.

Community Links has brought together charity, business and government leaders including Sir Stuart Etherington, CEO of the National Council of Voluntary Organisations; Demos CEO and ex-minister Kitty Ussher; Martin Brookes, CEO of New Philanthropy Capital; Newham Council CEO Kim Bromley-Derry, and senior figures from Accenture, UBS and Hogan Lovells.

At this early stage we are looking for as many examples as possible of early action in practice – projects or stories from around the UK which demonstrate the power of this approach.

A one-page template so you can tell us your story is available to download from the Community Links website http://www.community-links.org/our-national-work/early-action/

The size of the challenge: Unemployment up, Support to get a job could reduce

Unemployment unexpectedly rose last month, official figures reveal today, underlining the challenge facing people looking for a job and the challenge for the government when it introduces its new employment support programme in the summer (The Work Programme). The Office for National Statistics said that the claimant count increased by 2,400 to hit 1.46 million in January. Women appear to be bearing the brunt of the latest wave of job losses: the number of men claiming unemployment benefit fell by 5,400 between December and January, but the number of female claimants rose by 7,800.Young workers are also struggling to make their way in the depressed labour market, with one in five 16 to 24-year-olds – 965,000 people – now unemployed.

On the same day as unemployment figures were published the BBC have revealed that the government’s new work programme will actually help fewer people than the existing schemes that ministers are scrapping.

“…officials have said they expect 605,000 people to go through the scheme in 2011-12 and 565,000 in 2012-13.

About 850,000 people went through the last government’s schemes in 2009-10 which are now being scrapped”

DWP have said there would be more intensive help for people at Job Centres even if they were not on the work programme. It would be interesting to hear your experiences of the Job Centre and its ability to give the type of intensive support needed in the current job market.

We are working with a number of organisations across the country to offer the Community Allowance as part of the Work Programme – a day like today shows how important it is that we make sure that the support and the opportunities created are really up to the job.

When points mean more cash for getting some people back to work

Guest Blog by Jess Steele – Chair of the CREATE Consortium

 

Why would the social justice sector welcome the commodification of the people it cares about?

People are complicated. Life always has another nasty twist else to throw at the weakest. Disadvantages breed and feed off each other. Real people face multi-complex mixtures of poor housing, poor health, debt, violence, and a series of petty but frightening entanglements with the ‘safety net’ state. Local community organisations can be life-savers precisely because they don’t focus on one issue but on whole people.

Why would I dare to suggest, then, that we might welcome a points-based system that sets a value to the individual on the basis of their various disadvantages? Surely ‘differential payments’ whereby a welfare to work provider would get more money for someone with more points, just entrenches the commodification of benefit claimants. I hate the way the Dept for Work and Pensions talks about ‘the welfare stock’ like so many products to be shifted off a shelf. But as someone who believes passionately in local social justice, I’ve spent years looking for welfare solutions that recognise distance travelled and value the small moves a person can take towards a more independent, more engaged life lived locally. I think the points system could be part of it.

Our proposals for the Community Allowance would allow community organisations to pay local people to do the work that needs doing in neighbourhoods without affecting their benefits and wrapped round with the support that only trusted, rooted local civil society can offer.  Most of the work that needs doing is part-time, sessional or short-term – these are new kinds of job altogether, a phantom economy that should exist but doesn’t. While we wait for Iain Duncan dynamic benefits system, let’s focus on these small-scale win-win-win opportunities.

The move towards large-scale contractors in ‘the welfare industry’ is hurtling towards its logical conclusion.  Private providers will raise private finance for working capital to cash-flow ‘black box’ employment support programmes across huge regions. Government will use the benefit savings to buy outcomes after 12 months – getting someone into a job – and then again at 24 and 36 months for keeping them in work. If everyone is treated the same and there are no rewards for the steps towards employability the temptation to cherry-pick the ‘easy’ ones is irresistible.

Imagine that Lisa is a single mother with 3 children and a history of drug use, John has just left prison, Hanan is up to her eyes in debt and Priya is fighting a custody battle that makes him angry and depressed. All have been assessed and they average 22 points on a scale that goes to 30. They are all getting support from and working on the Community Allowance through the community anchor organisation Downtown Trust. Over the course of a year the trust supports them to make progress in their lives and experience some real but very flexible work. At the end of the year their average points reduce to 9. Now they’re in a space where a private provider could help and within another year three of them are in work. At this stage the provider would get much less money for them, not just at the point of job placement but for each of the next two years (average 9 points x 3 outcomes x 3 years =81). But if the provider had grant-funded or contracted with Downtown Trust from the start they could be said to ‘own’ the points our four friends began with and could be rewarded accordingly (22x3x3 =198). If the claimable benefits savings payment was £300 per point per year the changed lives of these four people would have contributed an additional £23,000 which could refund the provider for cost of the grant/contract to Downtown.

There are lots of assumptions here and it would need to be modelled to make sure it was viable for everyone involved. But at the core of the idea is the simple valuing of support to help people deal with the barriers in their complicated lives, the development of a business model that can legitimately and sustainably reward those who provide that support best, and the creation of a new kind of community-based mini-job that transforms the way local neighbourhood regeneration gets done.

Universal Credit – will welfare now let people work?

The CREATE Consortium has campaigned for a number of years about the “benefit trap” and the need to tackle the situation where people are worse off working, then staying on benefit. We have welcome many of the changes that have been announced by the government especially their commitment to simplify and modernise the system and “make work pay”. Yesterday the government published its White Paper setting out its proposal to reform the benefit system – “Universal Credit: Welfare that Works“.

Making Work Pay

At the heart of our calls for change, has been the need for new earning disregards/allowances for people on benefits- allowing people to keep more of their earnings and benefits  – making work pay and families better off . In the White Paper we are given some guidance on the new disregards but the actual figures will not be set for some time. Unfortunately, the paper does state that they do not expect to include a disregard for a single person without children – which seems a real opportunity missed. The figures we are given are;

• couples: £3,000 plus £2,700 per household for a child (regardless of number of children)
• lone parents: £5,000 plus £2,700 per household for a child
• disabled people: £7,000 per household if a recipient or either partner in a couple is disabled

However, working out exactly how much better off someone will be when they start work is not as simple as looking as their potential earning disregards. The amount that will be disregard will be reduced to take into account the amount that people receive in benefit to pay their rent or mortgage interest. The White Paper gives the following example:

A lone parent with three children has a rent of £80 a week

The maximum earning disregard is £7,700. However, the help she receives with her housing costs is £6,240. So she will not be entitled to receive the full disregard of £7,700. To make sure that work still pays, her disregard is not reduced to take into account the full cost of her housing ( usually would be reduced by 1.5 times the cost of housing support), she will be given a £2,600 disregard (£50 a week). Any earnings over this will be subject to the new, more generous earning taper – she will also keep 35p for every £1 earned

Under the current system on Income Support the earning disregard for a lone parent is £20 a week. Any earnings over this are deducted £1 for £1.

The new earning disregards and earning tapers should ensure that people are no longer financial penalised for taking up work  and are actually better off.

Next Steps

When Iain Duncan Smith launched the White Paper yesterday he said that Universal Credit was an important first step. At a time when nationally there are 5 job seekers for every 1 vacancy, the next steps must be to make sure that people without up to date work experience or qualifications can actually get a job.

We are already working hard on the next steps – making sure that the right training and mini-jobs are in place to enable people to actually take advantage of these new earning disregards. The Community Allowance would create part-time jobs in local communities for unemployed people, so that they can start earning and gain the experience they need.  It would be a major boost for local communities who directly benefit from the work that is done. Today I was talking to Seetec ( a Welfare to Work provider) about the Community Allowance approach and how we might be to work together to make sure that The Work Programme will actually support people to work – utilising the new earning disregards and tapers, to finally let people work.

I look forward to hearing your comments

Best wishes Louise

Link to BBC News 24 Interview

My interview on about the government’s plans for compulsory unpaid manual work is now on You Tube. Please see it here and let us know what you think