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Flexible New Deal

Country of implementation
United Kingdom
General short description of the innovation
In 2009, existing New Deal programmes for jobseekers were re-organised in a single new programme, called Flexible New Deal (FND). The whole programme was rolled out in two phases and consisted of four stages of gradually increasing levels of ?conditionality? on jobseekers. FND was the fourth stage of the revised Jobseekers Regime and only implemented in phase 1 areas. Stages 1, 2 and 3 of the regime were delivered through Jobcentre Plus. The FND stage was delivered by contracted private and third sector providers under a ?prime provider? delivery model and with a ?blackbox approach? giving them only minimum requirement and guidelines for the service provision. After two years on JSA, unsuccessful FND jobseekers could move on to a further stage (Stage 5), which may involve a mandatory work element under the Community Work Programme. / / Stage 1: 13 weeks of ?self-help? with fortnightly meetings between the claimant and the personal adviser at Jobcentre Plus; Stage 2: 13 weeks ?Directed Job search? requiring jobseekers to attend meetings on a more regular basis and widened jobsearch criteria in terms of travelling time, wage level and hours of work; Stage 3: After 26 weeks and up to 52 weeks of unemployment the ?Gateway? phase takes place. Jobseekers are required to work with advisers to draw up a back-to-work action plan, involving a range of mandatory activities aimed at increasing the chances of finding employment; Stage 4: The period between 52 weeks and 2 years of unemployment is the ?Flexible New Deal? phase, in which jobseekers receive a more intensive and specialised employment support. / / Compared to the previous NDYP the group aged 18-24 remained in the ?Gateway? (stage 3) two months longer (6 instead of 4 months) before joining FND stage 4 of specialised private provider support. Young people, who classify as NEETs (Not in Employment, Education or Training) were mandatorily fast-tracked to join Stage 3 of the regime from day one of their JSA claim. The group aged 25+ also joined the ?Gateway? for 6 months, but 6 months earlier than they used to do, and were then potentially transferred to the FND stage. In response to the recession, some additional support services for jobseekers were also rolled out across Great Britain. Most of these new services were delivered by external providers, but customers accessed these services via referral from a Jobcentre Plus adviser.
Target group
Total Population
Policy Field
  • employment
  • social
Type of Policy
  • public-private partnership
Duration of the policy
10/2009-08/2011
Scope of innovation
  • Spatial coverage: national
General description of (intended) objectives and strategies
The Flexible New Deal was a classical ALPM using private contractors in a deregulated environment to improve the employment outcomes beyond those achieved in the past. The government assigned clear targets to benchmark these achievements. / / First objective: increase employability and help young jobseekers find lasting work more effectively; Second objective: Activation through a stronger framework of rights and responsibilities; increasing obligations on JSA recipients progressively throughout a claim while giving them tailored support to gain (and progress in) in sustainable work; Third objective: maximising innovation in all sectors with broad partnerships of back-to-work support delivered through outcome-based, contracted, private services; Fifth objective: avoid creaming and parking through ?critical success factors? and weighted payments; Sixth objective: Devolving and empowering communities for future sustainable employment which will be at the heart of neighbourhood renewal.
Type of ideal-typical strategy for the innovation
  • liberalisation
Type of innovation
  • new policy, practice or measure
New outputs
  • benefit eligibility
  • job guidance, coaching and/or counselling
  • others (volunteering and work experience)
  • services
Clarification of intended mechanisms, outputs and outcomes (optional)
The FND stage consists of support that is delivered by private contractors who are paid by DWP for the number of sustained job outcomes they achieve. Supplier Guidance given by the DWP specified minimum requirements for jobseekers support (black box approach). This included a face-to-face initial meeting to include an individual assessment of needs and an agreed Action Plan; fortnightly meetings; a minimum of four weeks continuous full-time work-related activity, which could take the form of a work trial, work experience, community work, voluntary work or certain types of work-focused training.
Intended target group
Unemployed people claiming JSA
Working age population
  • employment situation (unemployed)
  • main source of income: social protection (social assistance)
Actors involved in policy-making/implementation and/or evaluation
  • agency or national social insurance body (Jobcentre Plus)
  • central state
  • private for-profit organisations (commercial)
  • private not-for-profit organisations (e.g. Third Sector organisation or NGO)
Intended output
  • benefit eligibility
  • job guidance, coaching and counselling
  • others (volunteering and work experience or work trials)
  • services
Clarification of outcomes in terms of impacting resilience and labour market inclusion
Instead of one in two start-to-short job outcomes for participants DWP data showed that starts-to-short job outcomes were closer to one in five, and for sustained job outcomes one in eight (Davies 2011:232). Dual contract areas had slightly better short-term and sustained employment outcomes than single contract areas (idem:233). This is interesting because it was expected that direct competition would facilitate a step-change in performance. Compared to other welfare-to-work programmes Davies notes that the proportion of starts achieving 13-weeks employment was 21.4% for the Employment Zones for 18-24 year olds compared to 25.7% for Employment Zones 25+ compared to only 18.5% for the single Flexible New Deal programme (idem: 240). Compared over time, and taking out the slow start months and the first six performance months, the FND programme had 27% short-term employment outcomes for programme starters. This is only 2% more than the best performing part of Employment Zones, which operated in very difficult areas. During its best 6-month period it delivered short-term job outcomes above 30% of all programme starters. As for long-term employment outcomes (26 weeks and more) the performance is similar: FND had weaker outcomes than NDYP, ND25+ and EZ25+. / / The National Audit Office reported that the Flexible New Deal performed marginally worse than the non-intervention outcomes of Jobseekers Allowance for those over 25 years (NAO 2012:24). Research by the Policy Studies Institute found that the younger Jobseekers (18-24 year olds) in NDYP areas were more likely to be in paid work (by 6%) than FND comparator areas, and 8% less likely to be claiming the Jobseekers Allowance (Vegeris et al. 2011a:84). Full-time employment of programme participants aged 25+ was much more likely for FND areas than for phase 2 areas. Participants aged 18-24 did not experiences major contractual differences when entering paid in both areas; they had however an overall higher transition into labour market in phase 2 areas than in FND areas (Idem:91). In terms of earnings young programme participants (18-24) had slightly lower earnings in phase 2 areas. Conversely, for those aged 25 and over, a slightly higher proportion of workers in phase 2 areas earned more than those in FND areas, which can be explained with different earning patterns for the group 50+ (idem: 95). Customers in FND areas were marginally more likely to agree that their job offered opportunities for progression and that their employer would offer training to enable this. / / Some stakeholders interviewed for this piece of research stressed that contracting fragments programme responsibility among multiple contractors, changes the relationship between those who design policy and those who deliver front line services, blurs lines of responsibility and accountability and for negatively impacts transparency for reason of confidentiality in a tendering process. This might directly have negative impact on the inclusiveness and resilience of labour markets. / / Sources: / Davies, W. (2013). For Neither Love Nor Money: Was the Flexible New Deal a more effective and efficient active labour market policy than those it replaced?, University of Liverpool, thesis. / NAO (2012). The Introduction of the Work Programme, Report by the Comptroller and Auditor General, HC1701, London. / Vegeris, S. et al. (2011a). Flexible New Deal Evaluation: Customer Survey and Qualitative Research Findings, Policy Studies Institute and DWP, Research Report No 758, London/Sheffield. / Vegeris et al. (2011b). Jobseekers Regime and Flexible New Deal Evaluation: Findings from longitudinal customer surveys and qualitative research, DWP Research Report No. 767, London/Sheffield. / Vegeris, S. et al.(2010). Jobseekers Regime and Flexible New Deal evaluation: A report on qualitative research findings. DWP Research Report No. 706, Leeds.
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