Welfare Reform Bill

These amendments would remove some clarity concerning the scope of the powers that the Secretary of State has to support providers of the "work for your benefit" programme or those who supply related facilities. It would be useful perhaps to clarify the purpose of these powers. First, there may be instances where the Secretary of State may wish to provide facilities to contractors or sub-contractors to ensure that the programme works as well as it can. For example, there may be circumstances where a subcontractor would want to run a workshop in Jobcentre Plus premises to explain "work for your benefit" to prospective participants, or there may be times when host organisations wish to interview prospective participants and the most sensible place to do that would be in government buildings. The department will certainly wish to give support by way of guidance and advice to suppliers. It is our intention that this programme will be delivered by private and voluntary sector contractors. We will procure this programme through an open competition. As we are encouraging, through the contracting process, creative delivery and innovation, it would be naïve of us to think that we can predict today how the Secretary of State may be asked to support a truly innovative process. It would be sad indeed if we had to stifle that innovation because there was doubt about whether we had the powers to provide such support. That is the reason why the clause is drafted in such a way. Accepting the noble Lord’s amendment would remove legal clarity, and could, I think, result in timidity in helping providers adopt new ways of helping jobseekers. In terms of how we will pay providers, we expect that funding will be at least partly outcome-based, in line with the department’s commissioning strategy. This means that the payments could consist of a service fee and at least one type of outcome payment. However, there may be times when the Secretary of State wishes to provide alternative forms of financial support to providers delivering "work for your benefit". This is not something we are planning, but it is not possible to foresee all the circumstances in which we may wish to provide alternative financial support for providers. During the lifetime of a contract, circumstances may change, as we have seen during the current economic downturn. It would be unfortunate for customers if we could not adopt practical solutions because there was doubt about how we were able to remunerate providers. I can assure noble Lords that these sections of the clause are in no way sinister and exist solely to ensure that we provide the best support we can to jobseekers in a range of circumstances, not all of which we can predict. I should also point out that this section will simply replicate the legislative approach we took with the employment zones in the Welfare Reform and Pensions Act 1999. The intent is entirely benign. The noble Lord made reference to an article in the Financial Times about a list of preferred bidders and I am advised that that preferred list is on the DWP website. There is nothing secret about it. The noble Lord made reference to the shape of the contractual arrangements for Flexible New Deal. I should stress that it does not necessarily follow that Flexible New Deal providers will be the providers who provide "work for your benefit"—it may not. I do not have before me all the details of how the Flexible New Deal contracts are structured, but they certainly have an outcome focus. The "work for your benefit" budget is £20 million, as we discussed the other day. We are working with providers to design a funding model, so there should be some outcome funding attached to that. The noble Lord also made reference to the Flexible New Deal to customer churn. Linking rules exist so that if a customer gets only short-term work—less than 26 weeks—they go back to the Flexible New Deal contractor. I think that that covers the points that the noble Lord was seeking information on, but I am happy to try again if not.