Government launches £5bn initiative to get Britain back to work

The Government is committing £5bn to a radical scheme that aims to get millions of people off long term benefits. It plans to 'break the cycle of unemployment' by incentivising companies to take on staff and reintegrate them into working life. In its first two years, it will help two million people, making it the largest ever scheme of its kind.

The Government has pledged contracts worth between £3-5bn in benefits savings to organisations that get people off the dole and back on the payroll. You get a whopping £14,000 for getting someone on incapacity benefit into work and keeping them there for two years.

Competition for this business is stiff. Companies like Serco and A4e (check out our interview with A4e boss Andrew Dutton talking about his tender for this very thing) fight tooth and nail for their slice of the pie. Contracts of this nature have become increasingly results-led. A good thing, you may say, but as the risk grows, so does the cost to the tax-payer. Big players in this sector have banded together in the past to inflate rates en masse.

Skirting over this controversial issue, Chris Grayling says: "Today we will be setting out a completely new way of helping people off benefits and getting them back into work. Gone are the days of a top down, Whitehall knows best approach. We will give the best of the private and voluntary sector the freedom to do what works to help people.

"Gone are the days of huge up-front payments which left the taxpayer out of pocket and parked the hardest to help in a corner and ignored them. We will pay organisations by results and expect them to deliver.

"And gone are the days when people could take the system for a ride by not playing ball because we will give everyone who needs it help from the Work Programme, but don't take up that help and you will lose your benefits."

Unemployment is a real hot potato for the current Government. Currently, in the UK, 2.6 million people are out of work. But the issue is more complicated than simply getting more bums on office seats. Post-recession, businesses are starting to recruit again, but they are struggling to fill skilled positions, fuelling fears of 'lost generations' in Britain.

The National Employer Skills Survey (NESS) revealed that 19% of all reported financial services vacancies were 'hard to fill' vacancies - with skills issues identified as the most common problem.

Carmen Watson, MD of recruitment firm Pertemps, says: "The Work Programme will need to engage and educate employers to a greater extent if it wants to enable sustainable employment and create a competitive market."

Liz Field, CEO of the Financial Skills Partnership, says, "Behind the figures lies a diverse range of individuals - graduates who cannot get a job, people who have fallen out of the education system at sixteen, and those who lost work during the recession or crossing over from the public sector. A key part of the new Programme is designed to prepare people for the world of work through work experience and apprenticeships."

Field doesn't believe that the Work Programme can work in isolation. There needs to be increased support far earlier in the work cycle: "There is a need for young people to get early exposure to the world of work," she says. "Through quality work experience placements and business education in schools, career prospects and aspirations are significantly raised from an early age and young people are better prepared for the world of work, ultimately helping the UK back on the road to recovery."




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