Welfare reform: Figures show IDS has a mountain to climb

By Ian Dunt

An audit of the previous government’s attempts to reduce the number of people on incapacity benefits has shown the extent of the challenge facing Iain Duncan Smith.

Mr Duncan Smith, who dominated the news agenda yesterday with his opening salvo of his welfare-to-work programme, is expected to introduce wide-ranging changes to the Department of Work and Pensions, where he was recently made secretary of state.

But a report from the National Audit Office (NAO) today revealed the categorical failure of previous attempts to change welfare payments, particularly in the case of incapacity benefits.

Labour’s Pathways to Work programme was branded a failure by the auditors, who noted that the volume of claimants has remained in excess of £2.5 million for over a decade.

“The Pathways to Work programme has turned out to provide poor value for money and it is therefore important that the department learns from the experience,” NAO chief Amyas Morse said.

“In the future it should base its programme decisions on a robust and clear evidence base, follow best contracting practice and establish a measurement regime which allows it to understand better what happens to those whom they may have helped.”

But there were some worrying results for Mr Duncan Smith’s programme, notably in the use of private sector organisations and charities to get people back into work.

The Pathways programme is led by Jobcentre Plus in many areas but contracted out to third sector and private organisations in over 60% of the country.

The NAO found that no evidence the programme performed better or cost significantly less in contracted out areas than in those run by Jobcentre Plus.

“Contractors have universally underperformed against targets set by the department,” auditors found.

“With a third of contracts making a financial loss, the programme’s contracted out delivery does not appear to be sustainable.”