A tale of two cities

On my way from a meeting at the Institute of Fiscal Studies to the Department of Work and Pensions yesterday, I picked up a copy of the Evening Standard on the tube. The headline rang ‘The Dispossessed’: London is a shameful tale of two cities. In the richest capital in Europe almost half our children live below the poverty line.

It was refreshing to see a mainstream media outfit deal with the issue of poverty in London. This is something one of the CREATE Consortium’s members, Community Links, has been blogging about recently.

Reading Joe Murphy’s How politics turned its back on the dispossessed, was particularly interesting given the conversation I had just had with the Institute of Fiscal Studies’ Mike Brewer. We were discussing the difference in attitude that both politicians and the public have towards benefits payments and tax credits. Both are tax payer’s money and yet benefits are seen as a drain on the public purse, something to be minimised at all costs, while tax credits are seen as a positive intervention.

It left me wondering from a campaigning point of view what we could do to change this attitude. It goes to the heart of why there is a need for a Community Allowance. If you are on Job Seekers Allowance and try to work for under 16 hours a week you have penny for penny taken away; the earnings disregard still being only £5 a week – less than an hours work on the minimum wage, unchanged since 1988! Yet if you take a job of 16 hours, tax credits protect your income and you are better off in work.

What kind of message does this send to people who want to get themselves out of poverty by taking some part time work? Why did the Government decide that 16 hours is good but 8 hours is bad? It’s an illogical distinction, only made logical by the pervsersity of the difference between the benefits system and tax credits. It has to change.

Interestingly, I am noticing that there seems to be a growing understanding of the necessity of this change, across the political spectrum. This marked change in attitude has come about in the last two years through a wealth of campaigning about the earnings disregard and influential reports such as the Centre for Social Justices’ Dynamic Benefits.

On Saturday I was on a panel with Tim Loughton MP (of Tower Block of Commons fame)  Shadow Minister for Children, at the Conservative Party Spring Forum. He seemed to get it. So did Terry Rooney MP, Chair of the DWP Select Committee, who I met yesterday after I’d been to the DWP.

The question is, what are politicians going to do about it? In a new era of austerity and public spending cuts, how do we tackle poverty? We think the Community Allowance is part of the answer to that question. For a change in the benefits regulations you get a win-win-win: for the person on benefits, earning a bit of money and gaining real work experience, for the community having socially valuable work done locally and for the tax payer every £1 spent on a Community Allowance would create £10.20 worth of social value.

We’re still waiting to hear from DWP about whether we can pilot the Community Allowance. The pace of the discussions in response to our Right to Bid proposal originally submitted in January 2009 is making us question the depth and sincerity of their commitment to pilot it in the 2008 White Paper. We’ll be blogging soon about what we’re thinking of doing next and how you can get involved.

Guest blog from Julia Unwin – CEO Joseph Rowntree Foundation

There are two very different public policy issues that currently cry out for resolution, and the Community Allowance provides the start of an answer to both.

The first is the appalling and risky under-funding of community based organisations. All community based organisations rely on the unpaid work of members and volunteers, sacrificing large amounts of time to try and make their communities better places. But without some funding for organisation and co-ordination, the strain can simply be too much. What is more, organisations without any paid leadership can find it difficult to find the time, or the energy, to do those essential things that enable community groups to grow and develop.  Funding has always been tight for community organisations: there is nothing new there, but as we face major spending cuts, the fragile hold that some community groups currently have on local authority funding may be even further eroded.  Voluntary effort may be the engine of community organisations, but frequently the lack of any paid staff means that the engine stalls.

And the second problem crying out for resolution and response is the way in which people living in poverty are helped to move into paid work. Research by JRF and others has shown that the complexity of the benefits system does put off many people from trying paid work because of the instability this can introduce into their household budgets – stability being more important for some than the extra income from employment. The Institute for Fiscal Studies and Gingerbread did a study for JRF modelling different ways of approaching ‘mini-jobs’ (of less than 16hrs per week) in the welfare system and concluded that a bigger disregard of earned income would have beneficial impacts on employment for lone parents. Other research funded by JRF, carried out by the Centre for Research in Social Policy, into the standard that most people think is needed highlights how far below adequacy some people on benefits can fall, especially if they do not have children living with them.

The Community Allowance provides the start of a solution to both these problems. It allows community organisations to offer employment to some people, and so provide the fixed commitment that they need so urgently, and it allows the individuals the opportunity to try out new work, and get remunerated for doing so.

And it is now more urgently needed than ever. The Welfare to Work reforms for Flexible New Deal will inevitably focus on those closest to the labour market, at least initially. The Community Allowance is aimed at helping people get into work who would probably not benefit from immediate help from the Welfare to Work providers, even the third sector ones.  This much more grassroots-led approach can complement, but not replace, the other approaches.

In my view it will do this in two distinct and innovative ways.

First, many people who do go into work from benefits at present risk swapping one form of poverty for another.  The Community Allowance will alleviate this to some extent by providing a safety net of benefits whilst people who have been out of the labour market for some time can get used to doing paid work.

Second, local community and other organisations who could employ people doing useful mini-jobs at present have difficulty recruiting people because of the disincentives in the benefits system.

The Community Allowance helps the individuals doing the work, the organisations who are getting the work done, as well as the community organisations which need the work done. The costs are small and the benefits significant, both to the individuals and to the organisations with which they work.

Julia Unwin CBE

Chief Executive, Joseph Rowntree Foundation

In and Out of Work – Glenn Jenkins from Marsh Farm Estate, Luton

I am a resident of the Marsh Farm estate in Luton who became unemployed in the 1992 recession and, for a number of reasons, has been living on state benefits for most of the time ever since. However, unlike the more than a million other people in the UK who find themselves in the same situation, I have been lucky enough to have escaped the worst of the numbing effects of long term unemployment by taking part in the creation and organisation of community self help projects ‘by and for socially excluded people’.

This gives me long, first hand experience of life ‘at the margins’, which means I really appreciate the positive impact the introduction of the Community Allowance would have, not just for the sizeable minority of people living here who are stuck in different departments of the ‘benefits trap’ and highly unlikely to ever find meaningful work, but also for the public at large.

For many people on Marsh Farm who do manage to find work, the story is not much better. The latest unemployment statistics for Luton show that the current economic downturn has seen joblessness go up on Marsh Farm at a rate 3 times that of Luton generally. This is caused by the large number of people living here who, when they do manage to find work, end up in temporary and insecure jobs which are always the first to go in a ‘recession’.

This syndrome of ‘in and out of work’ nearly always leads to a period of severe financial instability similar to that described above for these individuals and their families. This is a disaster caused in these cases by the disjointed nature of the benefits system and its inability to efficiently manage the transition from work to benefits and benefits to work.

As the UK Insecure at Work survey explains “throughout most of the last decade, almost half of the men, and a third of the women, making a new claim for Jobseeker’s Allowance were last claiming this benefit less than six months previously. In other words, almost half of men who lose their job, and a third of women, had had that job for less than six months. This shows the short-term nature of the jobs that many unemployed people go into”.

As a long term resident of Marsh Farm I promise you, the instability caused by the ‘in and out of work’ syndrome is pushing several young families to the brink of impoverishment and homelessness.

Although it almost goes without saying (I hope) that everyone is an individual with a specific set of needs, the welfare to work systems in the UK are notoriously bureaucratic and unable to provide relevant and useful support for the majority of long term unemployed people living on Marsh Farm. The internet dictionary ‘Dictionary.com’ describes a bureaucrat as “an official who works by fixed routine without exercising intelligent judgment”, a description which perfectly sums up the experience for most of the long term unemployed people I know.

For many people, interventions by Job Centre Plus and other support agencies leads not to a pathway to work, but instead to being forced onto ‘courses’ which are widely felt to be box ticking exercises for government targets rather than genuine attempts to help people back into work.

As a topical and personal example of this ‘one size fits all’ approach, I was recently ordered (at threat of loss of all my benefits) to take part in a ‘basic skills assessment’ (due to my reaching 18 months unemployed).

This is a 1 hr ‘exam’ consisting of a set of numeracy questions like: 2 + 2 + ? = 11 and literacy questions like “I wien to the shop to get some tea” – please identify the spelling mistake.

This ‘exam’ was delivered by a qualified teacher who travelled from Dunstable College (which is 5 miles away – and there were only two of us there!). As I hope my authorship of this article shows, this ‘exam’ is a complete waste of my time, the advisors time, the trainer’s time and is nothing less than a scandalous waste of public money. In any sane system, the advisor would have the flexibility to identify those who need such support, and those who do not, and would be free to tailor any support provided according to the specific needs of each person they are working with. But here again, the only support the advisor can provide is restricted to that delivered by those providers who have ‘won the contract’, regardless of whether the training is relevant to the individuals needs, or the quality of the training itself.

My own experience of this ‘one size fits all’ approach to the provision of ‘support’ is nothing when compared with the real and lasting damage caused to other people’s lives who are treated in the same way, but who are not so well placed to cope with it as I am.

Guest Blog – Sir Trevor Chinn: The benefits of work

The absolute route out of poverty is a decent job. All our efforts and mechanisms should be encouraging people in this direction.

There are wonderful stories of people taking poor jobs, even to their own financial disadvantage, because they believe in the dignity of work or as an example to their children.  Most poor people, living on benefits, need real encouragement and help to move in this direction.  The benefits system does not necessarily encourage them.  There exists an historic and collective memory about losing benefits and about over-payments which frighten people from taking work.

The Community Allowance will enable people to ease their way into work, to get used to the idea of working, and the psychological and financial improvements that go with it.

I have recently chaired a Taskforce for the Government on the Take up of Benefits.  I learned of the extraordinary complexity of the benefit system which is of course targeted at the most deprived and least educationally advantaged segments of our society.  Unfortunately not only is it complex but elements of the system produce traps for those enjoying certain benefits but wanting to take employment. A lack of understanding of Working Tax Credit adds to the misconceptions. Further- more an over-emphasis on benefit fraud frightens away many who don’t understand the system (of a 2% total of official error, customer effort and fraud, only 0.6% is fraud). To sum up, the Taskforce Report’s headline was that if everyone took up the benefits to which they are entitled, a further 400,000 children would be taken out of poverty.

It is easy to under-estimate the benefits of work.  Work is a habit which needs to be developed and encouraged.  The advantages of work undertaken within the Community Allowance framework is that it eases that process.  Taking on part-time work is a first step that can lead to full time employment.  The extra income will bring benefits that can lead to a desire to achieve a full time wage. The extra money will lessen family poverty.  There is also the benefit to the Community of the work being done which will improve the environment for all those living there and the worker having a sense of helping others.  The income derived will be spent locally thus also improving the financial well-being of the community.

It is a win/win/win.  The greatest benefits are psychological – for the person undertaking work and experiencing a sense of personal value – for his or her family, benefiting from the experience of someone without work, under-taking work – for the community, seeing someone unemployed doing work which benefits those around them.  We are seeing large scale unemployment in certain areas of the country and especially London.  The communities experiencing high unemployment can be ones where no-one in a family has worked for three generations; can be individuals experiencing long-term unemployment; can be young people unable to find work because of the recession; can be ethnic minorities disadvantaged by language, education or discrimination.  Every time we help someone into the work process we are making a huge difference to their lives and their well-being. The Community Allowance can be an important process in that direction.

Sir Trevor Chinn, Businessman and Philanthropist

Beveridge 4.0 – Guest Blog by Hilary Cottam

Towards the end of his life William Beveridge, the architect of the modern welfare state published a third report.  In this report, Beveridge, voiced his concerns that he had both missed and limited the potential power of the citizen.  He believed that he had been overly statist in his approach and that people would come to define themselves by their needs, resulting in high cost and personal misery.  The welfare state was in other words preventing people from using their own resources.

At Participle we believe the post war institutions have been remarkably successful at transforming society, but they are no longer fit for purpose.  The arrangements we have will not deliver a more socially cohesive, fairer nation because the problems we face are so different and the nature of British society too is so changed from that of 1942.

We need a new ‘Beveridge’, a vision as bold and as imaginative as the original one was in its day.  At Participle we are working towards just such a vision – one we call Beveridge 4.0 because we take Beveridge’s third report as our starting point.

Beveridge 4.0 is not about re-defining the ‘giants’ but rather about a new lens to look at both new and entrenched social issues.   We need to turn current approaches on their heads and start not with what is wrong with the institutions, but with people themselves and what they potentially have to offer.   In other words we start with the power of the citizen.   If we were to distil our approach to two things we would say it is about participation and social contribution.

Our vision is informed by the work we do every day in communities across Britain and driven by five core principles.  Each takes as a starting point a major principle in Beveridge’s original report and re-evaluates it for the specific demands of our time. The Community Allowance embodies these principles.

First we propose a shift from needs to capabilities.  A needs based model forces individuals to prove that they are eligible for services, a process of self-definition that all too rapidly becomes one of self belief as Beveridge himself realised.

A capabilities approach draws on the work of the nobel prize winning economist Amartya Sen.  It powerfully inverts the logic of ‘I need…” to ‘I want to be able to live this way…’.  In other words it recognises the importance of inequality and builds on opportunity, whilst fostering a deep commitment to supporting people in such a way that they can seize and shape the opportunities life offers.  We have focused on three capabilities that we believe are core to being a twenty first citizen: relationships, work and learning and the environment – local and global.

Secondly, we propose a shift towards universal services that are open to all.  It is currently not untypical for a public service to spend up to 80 percent of its resources on gatekeeping: assessment exercises designed to keep people out.  This is a misuse of resources.  It also shows a deeper misunderstanding of the nature of the challenges we now face: climate change, ageing, the so-called life style diseases – all call for universal, preventative services – solutions which are open to all and open to mass contribution as well as mass use.

Our new service Southwark Circle, designed with and for older people, shows this principle in action.  Southwark Circle helps its members take care of little jobs and builds social connections, supporting an active, rich third age.  Our membership crosses the social spectrum – the service has been designed to appeal to all.  In turn the more heavily and widely the members use the services available, the healthier and happier they will be and the more resources there will be in the system to offer support to others – a virtuous circle.

Closely related is the third shift, a move from a narrow financial focus, to a focus on resources.  The current welfare state counts only contributions made through the taxation system.  Alternatives have been tried – time banks for example that bank volunteer time – but they are fragile, competing with, rather than contributing to a wider system.  We need new platforms that combine financial, voluntary and private resources, thus growing the overall resource pot to support new ways of doing things.

Our work with families in chronic crisis – many of them third generation unemployed and suffering from entrenched issues of poverty and social exclusion has shown us how even in this most challenging situation, people have something to give, something to build on, provided the benefit system does not get in the way. Unfortunately, our experience across the country has shown how the benefits system often stops people from taking up the opportunity for paid work. The Community Allowance would tackle this.

Fourth, an emphasis on distributed institutional networks, such as community organisations.  This does not just mean a shift from the centre to the local, which we support, but a more radical shift away from doing things to people, to doing them with people.  More bottom up, participative approaches are both dependent on and sustained by a more distributed model.  A more humane, conversational relationship is possible at the community level.  And of course these distributed institutions are infrastructure light, compared to their 1950s predecessors – an email account rather than a new building is all that is needed.

Finally, our fifth proposed shift is from the current focus on individuals to one on social networks.  Our experience is that people want to support each other, but the systems and services on offer make this hard, if not impossible.  Take our current youth services as an example.  Youth services currently target narrow groups of young people defined by age and risk – teenage pregnancy for example.  The service then tries to contain the target group within institutions such as youth centres.  In contrast, international research overwhelmingly shows that it is intergenerational relationships that foster a wider sense of possibility that determines a young person’s future – in other words a network, not a narrow focus on an individual.

The current economic and political crisis is a moment of opportunity.  We have been faced by two dominant, atomising narratives: the market telling us that we are individual consumers defined by our desires and wants and the state, which at once has tried to mimic the market’s emphasis on consumption and to define us by our needs.  If there is one message Participle has heard most loudly through our work it is this: we want to be socially connected and to collectively contribute to making change happen.

Guest Blog – Jess Steele, Chair of CREATE Consortium

The Community Allowance will enable community organisations  to pay local people to do work that strengthens their neighbourhoods without disrupting their benefits. This is a win-win-win proposal that helps individuals make progress to become more independent, gets the work that needs doing in poor neighbourhoods done by the people best placed to do it, and channels the energy and trust of civil society towards the big aim of using our welfare spend as an investment in social change rather than a net that traps people in poverty.

The sheer obviousness of the solution has always driven me onwards in this long campaign and has never failed to convince anyone who listened for 20 minutes, though their responses have varied from a conviction that it can be achieved ‘within the system’ to world-weary warnings not to ‘rock the boat’ or smash our energies against the intricately-constructed, ideologically-defended brick walls of the Department for Work & Pensions.

But I have known so many people on benefits, and so many local organisations that wanted to employ them, that there has been inspiration enough to keep insisting that the system itself must change. It is fundamentally outmoded, modelled on the Victorian ‘doctrine of less eligibility’ that sought to make ‘relief’ so truly awful that people would do anything to avoid it. It is an on-off switch that mirrors a world of work that has been disappearing for generations, a ‘safety net’ congealed into a trap, a revolving door that while the economy grew could spin the ‘work-ready’ off the books and keep ‘those left behind’ spinning on the spot. It is notoriously bureaucratic so that even the Benefit Simplification Unit has been a Dickensian irony locked in the basement of Adelphi House pondering clause 54.b (ii).

The campaign route has been littered with government ministers who thought they were important at the time but lasted only to the next reshuffle or, more recently, to the next squabble. Some of them returned as is the tendency of long governments with decreasing majorities. At last, pressure by us and many others paid off – from April 2010 anyone on Employment Support Allowance or Incapacity Benefit will be allowed to earn up to £92 a week without risking either their core benefit or housing benefit. But the 900,000 people on Income Support for Incapacity are not included; nor are lone parents or carers, or those hundreds of thousands on Job Seeker’s Allowance who disprove the myth that JSA claimants are ‘job-ready’ even when the jobs exist. Moreover, claimants will still need to declare these earnings opening up opportunities for error and misinformation while failing to reward people who are trying to work with the greatest gift of all – getting the system’s claws out of their back to create a breathing space in which to rebuild their lives free from fear.

The guest contributions for this blog come from many perspectives but all share a common view. All our writers understand that the longest journey starts with a single step. Sir Trevor Chinn describes how crucial it is to ‘get up, do something’. Taking the first step into small-scale work is the only way out of poverty and the small amounts of mini-job wages can make a big difference. People need to be allowed to take responsibility, encouraged and supported rather than punished, but the system is oversensitive to small earnings. Dame Barbara Stocking uses that key phrase – the system is ‘no longer fit for purpose’. Muhamed Yunus recently captured the challenge – if someone on welfare earns a dollar, match it with a dollar, don’t crush that willing initiative by confiscating the first one as if it were ill-gotten.

Julia Unwin CBE makes the point that the Community Allowance is a multi-faceted solution – not just about individual poverty but also addressing “the appalling and risky under-funding of community based organisations” and “getting the work done” for local neighbourhoods. She describes the latest in the long line of respected research studies and policy documents, including several from DWP itself, that have urged reform of the earnings disregard. She is clear that the grassroots Community Allowance complements rather than replaces other welfare to work approaches.

The big divide is between people like Dame Barbara Stocking of Oxfam who know that “there is enormous untapped potential in some of the poorest communities, and above all in the people who live in them” and those who cannot believe that poor people and poor neighbourhoods have not brought their stigma upon themselves. Sadly, the former tend to be those who work in and with local communities, whereas the latter too often guard the powers of Whitehall and Westminster. In a UK-wide benefit system, it seems there is no scope even for Scottish, Welsh or Northern Irish experiments let alone truly localised opportunities.

And Beveridge… how pleased I was to learn of his doubts from Hilary Cottam of Participle, how he realised that his grand plan had left out the crucial role of the citizen and collective action in a true welfare society. It reminded me of Sybil Phoenix OBE telling me how initially she was impressed with the housing estates of the 1960s, and then how through experience she came to a new understanding. This is how we learn and make change – when people of integrity admit that all is not well. The Beveridge 4.0 concept is a powerful opportunity, a ‘new lens’, a thread of bright cotton leading us towards new thinking that could become the new normal.

Julian Dobson’s anger with the “Kafkaesque satire…where the well-off felt the badly-off were getting a better deal” reflects the disillusion of a generation who waited for Labour, cheered the Policy Action Team reports with their focus on evidence and now are repulsed by political pandering to “the coherent story of popular sentiment”. The “different story” he describes is the one that those of us on the ground in poor areas know best, “a story that begins with the people, not the prejudice”.

At a time when consensus is finally emerging that the welfare system is seriously unfit for duty, the Community Allowance solution works across all the party divides because it makes so much sense and costs so little. As Neil O’Brien from Policy Exchange puts it, we have to “allow claimants to take small steps to a full job”. There have been people and communities left behind throughout the boom, but now in the teeth of recession we face challenges that can only be met by using public spend differently.

Please revisit our blog over the next few weeks to read our guest contributors’ perspectives on the Community Allowance in full and do get in touch if you’d like to write something yourself.

Happy New Year!

We are still waiting to hear from the DWP about the outcome of our Right to Bid proposal to pilot the Community Allowance in three locations in the UK. So frustrating! They did get in touch earlier this week with another list of questions for us. Let’s hope this is the last and that we get a positive answer soon and can get on with it. We know there are so many people out there for whom a Community Allowance would make such a positive difference and hundreds of community organisations with part time work opportunities they can’t fill because of the benefits trap.

There is no more time to lose… let’s allow communities a chance to build their own resilience and replace the revolving doors with ladders that reach all the way to the ground.

Over the next few weeks we are going to be publishing guest contributions to this blog from a range of different people, all with something to say about the Community Allowance. We’ll be hearing from from Lord Adebowale, Phillip Blond, Sir Trevor Chinn, Hilary Cottam, Julian Dobson, Will Hutton , Glenn Jenkins, Neil O’Brien, Dame Barbara Stocking and Julia Unwin CBE amongst others.

If you have something to say and would like to be a guest contributor to this blog, please get in touch – we’d love to hear from you.

Successful Parliamentary Event for the Community Allowance

On Monday 2nd November we held an event at the Houses of Parliament, hosted by Lord Archy Kirkwood, a Liberal Democrat Peer who supports the Community Allowance campaign. Lord Kirkwood used to Chair the DWP Select Committee and said at the event, “When I first heard about the Community Allowance, I thought the DWP will never go for this, but I’m really pleased to see how much progress has been made.”

Over 60 people attended the event which was held to do three things:

1. to launch a new publication from the CREATE Consortium; a collection of essays from people across the political spectrum saying what they think about the Community Allowance

Contributions came from people as varied as Lord Adebowale, Chief Executive of Turning Point, Phillip Blond, Director of new think tank ResPublica, Sir Trevor Chinn, businessman, Hilary Cottam, Director at Participle, Julian Dobson, Editor of New Start, Will Hutton, Executive Vice-Chair of the Work Foundation, Glenn Jenkins, resident and Chair of Marsh Farm Outreach, Luton, Neil O’Brien, Chief Executive of the think tank Policy Exchange, Dame Barbara Stocking, Chief Executive of Oxfam GB and Julia Unwin CBE, Chief Executive of the Joseph Rowntree Foundation amongst others.

We will be publishing their contributions to this blog over the next few weeks.

2. We also launched a new report by the think tank nef (New Economics Foundation) a predictive Social Return on Investment analysis of the Community Allowance. This predicts that for every £1 invested in the Community Allowance £10 worth of social value will be generated.

3. We announced our three pilot partners for our first pilot of the Community Allowance over the next couple of years. They will be introducing themselves in more detail on this blog over the next couple of weeks but for now, they are:

Foresight in North East Lincolnshire

Learning Links in Portsmouth and the Isle of Wight

St Peter’s Partnerships in Manchester

We were overwhelmed by the number of exceptionally high quality proposals that we received from community organisations across the UK that wanted to pilot the Community Allowance. It was a very difficult decision making process and we wish we were able to work with more of the organisations who sent proposals to us. It shows what a need there is across the country for an initiative such as the Community Allowance and has made as more determined than ever to keep working until it’s available for anyone on any benefit anywhere in the UK.

Work for Your Benefit pilots announced

You may well have missed the somewhat depressing news that the DWP are going to pilot Work for Your Benefit sanctions in both Greater Manchester and across the counties of Norfolk, Cambridgeshire and Suffolk.

This will affect the projected 2% of Job Seeker’s Allowance (JSA) claimants who are unable to find work after 2 years of support and interventions through the Job Centre Plus and Flexible New Deal. However, Job Centre Plus advisors can refer people on JSA to do 6 weeks of Work for Your Benefit at any point from the start of their claim.

Work for Your Benefit will make people on JSA work for 30 hours a week (where possible placements will be of benefit to the community) in return for their benefits. They also have to undertake up to 10 hours a week of supported work search activity. The DWP are currently asking for organisations to express an interest in running the pilots.

We have had grave concerns about this initiative since it was first suggested by the Conservative Party and then included in the Government’s Green Paper on Welfare Reform. Here’s why: 

The Recession and Rising Unemployment

• It’s dangerous to associate community work in the public mind with ‘scroungers’ being punished, particularly during a time of rising unemployment. Community work is a great opportunity – part of the carrot, not one of the sticks. Getting people engaged in their communities is a crucial element in tackling worklessness and poverty, by maximising the opportunities that exist for part time, sessional and irregular work in deprived communities.
• With rising unemployment and increased competition for all jobs, it is likely to be those that are furthest from the labour market and most excluded for socio-economic reasons that will still be unemployed at the end of 2 years. Intervention in a community setting for this demographic should be supportive and enabling, not punitive.

 The DWP’s own research shows that ‘workfare’ doesn’t work

• Their research into the effectiveness of workfare programmes in the US, Canada and Australia found that overall the Work for Your Benefit approach is not effective.
• Work for Your Benefit is least effective for individuals with multiple barriers to entering the labour market
• Welfare recipients with multiple barriers often find it difficult to meet obligations to take part in unpaid work. This can lead to sanctions and, in the most extreme cases, the complete withdrawal of benefits that leaves some individuals with no work and no income.
• Some states in the US have scaled down large-scale, universal workfare programmes in preference for ‘softer’ and more flexible models that offer greater support to those with the most barriers to work. This includes a greater reliance on subsidised jobs that pay wages rather than benefits to participants.
• Subsidised (‘transitional’) job schemes that pay a wage can be more effective in raising employment levels than Work for Your Benefit programmes.
• Workfare is not only inefficient; it is unfair too, because it exploits the unemployed people forced to take part. If a job is worth doing it is worth being paid the rate for that job. Unemployed people on workfare schemes would be paid less than half the national minimum wage.

Government doesn’t understand the Community Sector Labour Market

• The labour market in poor communities creates predominantly part time, sessional and irregular jobs that reflects a national shift away from a 35 hour week towards a labour market that is more dynamic. Many of these are ideal ‘entry level’ jobs that could be a first step into work for the long term unemployed.
• The Work for Your Benefit pilots do not recognise the nature of the community sector labour market. It will be problematic to generate enough full time community work for people to do in their own community to sustain full time activity. 
• Transporting people out of their community to work in other communities displaces local ownership of work that is undertaken to improve a community. Local ownership is of crucial importance to the effectiveness and sustainability of community work.
• Additional transport time on top of full time activity will be very problematic for many people, particularly those who are single parents. Experience in the US, recounted by Alison Benjamin in The Guardian, illustrates how dangerous this can be, as the impact on children can be damaging, particularly when there is no rise in income associated with the parent’s absence.

We believe that the Community Allowance should be piloted as an alternative to Work for Your Benefit for people on JSA as part of an ‘enhanced stage 3 option’. We know hundreds of community organisations across the UK that would jump at the chance to work with Job Centre Plus on this, creating thousands of new paid jobs in the process. 

News from DWP

Well, we finally have some news from the DWP about the Community Allowance.

We (Steve Wyler, Executive Director of the DTA, Aaron Barbour, Head of Links UK at Community Links and me) went to a hastily arranged meeting with 6 officials from the DWP this morning to discuss our Right to Bid proposal that we submitted back in January.

We’ve got through two rounds of intensive scrutiny and evaluation from across the Department and they wanted to give us their feedback.

Because the last Secretary of State, James Purnell, said that people on Job Seekers Allowance (JSA) would not be eligible for the Community Allowance, our bid, which includes a lot of detail about people on JSA is not eligible for funding and they are rejecting our proposal as it stands.

While we are obviously really disappointed that this is the decision after all the work that has gone into getting this far, there is still hope.

They have asked us to write another bid (!) as they are keen on the Community Allowance concept and can see the value in piloting it to test the approach. They have given us some guidance as to how we should re-shape the bid to stand the best chance of being approved. This includes:

• Re-shaping what we would deliver through the Community Allowance for only people who are on Employment and Support Allowance and Incapacity Benefit
• Scaling back the pilot programme from 15 pilots across the UK to just 3 pilots as the Right to Bid process is targeted at funding small scale activity that can act as the DWP’s research and development arm to test out new ideas and add value to their existing work
• Choosing which three pilot areas it would be piloted in and having identified lead community organisations in each area before the bid is submitted
• Ensuring that each of these pilot areas fits within Job Centre Plus and Pathways to Work provider boundaries, which are different to local authority boundaries
• Beginning to develop a dialogue between the community organisation(s) running the pilot and local Job Centre Plus and Pathways/FND providers in each area
• Including more of a focus on how many people will move into jobs as a result of the activity, specifying which of these are part time, full time and sustained over a 26 week period

We have had lots of discussions about this today and think it is worth being pragmatic at this stage and moving ahead with another bid as outlined above. At the same time we will continue our lobbying and campaigning work to convince politicians that the Community Allowance should be available to anyone on any benefit and trying to get the scope of the pilots extended to include those on JSA at a later date. What do you think?

We would like to hear if community organisations are still interested in being pilot partners under this scaled back version of a Community Allowance pilot. If you are, or you’d like to discuss the practicalities of becoming a pilot partner please email Naomi Alexander (n.alexander@dta.org.uk) and copy in Jess Steele the Chair of the CREATE Consortium (j.steele@dta.org.uk).  Jess is available to discuss your potential involvement over email over the next two weeks while I am away on leave. I will then telephone all organisations that have expressed an interest during the week commencing 20^th July.

Depending on the level of interest, we will then set up a short selection process that enables us to choose three pilot locations and partners. The aim is then to get the new bid to DWP for their end of August selection panel, so that we have a decision in September and a contract signed and monies flowing to pilot partners by as soon as possible after that.

 It’s a challenging timescale, especially as it’s over the summer and people will be taking leave, but if you’re up for it – we’re up for it!

 We’ve come this far and have an opportunity to get something up and running next year that will begin to demonstrate how the Community Allowance could work. It may not be what we know is needed in our most deprived communities but it’s a start and we have no intention of giving up. With your involvement we will keep the pressure on politicians to realise the full potential of the Community Allowance over the long term.

 We look forward to hearing what you think.

 Thanks so much for your support.