While the government has been bragging about the welfare to work program, they are now getting heat for its implementation. A report from the National Audit Office shows that the program may fail to actually help the long-term problem with unemployment and that their predictions may be “over-optimistic.”
The idea was to allow British jobs to be filled by Brits, offering those seeking jobs an allowance and employers a bounty of £4,000 to £13,700 for every unemployed person who received long term work. The money would be paid out only once those in need had been working for 18 months. Ministers had hoped that the program would lead to a 40% increase in job placements.
However, NAO is pointing to a number closer to 25%, and focusing primarily on claimants who are much easier to place in jobs. As the report said, some of the companies that have won the contracts
“may encourage providers to target easier-to-help claimants while not helping others, reduce the level of service provided in order to reduce costs, or to put disproportionate pressure on subcontractors.”
Christ Grayling, the Employment Minister, said, that he was disappointed by the NOA findings. As he said, “Payment by results is a totally new approach for government and its success simply cannot be assessed in the same old ways. I’m really disappointed that the NAO is producing a report which is partially based on guesswork, when it’s private companies and not taxpayers who are carrying the risks.”