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27
Jan

DWP raises estimates for Work Programme starts by 32%

Posted in Work Programme by

Written by Paul Bivand, Head of Statistics and Analysis at Inclusion.

DWP has today released new estimates for Work Programme volumes as a result of the November 2011 OBR forecasts.

These have been published through the House of Commons library rather than on the DWP Work Programme pages.

Overall, across the five years, DWP’s estimate of how many people will enter the Work Programme has increased from 2.5 million to 3.3 million. We’ve set out the percentage changes for each group below.

Table 1: Change in DWP view of Work Programme indicative volumes since tender

  2011/12 2012/13 2013/14 2014/15 2015/16 Total
JSA 18-24 39% 83% 71% 26% 11%< 48%
JSA 25+ 3% 37% 60% 46% 38% 34%
JSA Early Access 238% 51% 44% 31% 26% 82%
JSA Ex-IB -55% 21% 34% 150% Previously zero 31%
ESA Volunteer -83% -27% -30% -10% -29% -42%
ESA Flow 7% 74% 70% 65% 60% 55%
ESA Ex-IB -73% -51% -43% -14% 400% -46%
IB/IS (England only) -75% -33% 51%     -32%
JSA Prison Leavers No previous view No previous view No previous view No previous view No previous view No previous view
TOTAL 7% 33% 44% 46% 43% 32%

The increase means a rise in “attachment fees” paid to providers of just under £97 million, over the three years when attachment fees are paid (these are the payments for people starting the programme). There is a fall of £18 million in attachment fees for ESA flow and ESA ex IB groups, but this is balanced out by a rise of £115 million in attachment fees for other participants.

Headline figures:

  • Referral volumes up 32% over the five years 2012/13 up 33%, rising to 46% increase in 2014/15, before reducing in 2015-16
  • Very different balance between groups than expected at this time last year
  • JSA groups substantially up, with the biggest rise being JSA early entry
  • ESA groups (except ESA Flow) substantially down
  • Ex-IB groups (JSA or ESA) shifted back roughly a year
  • Volumes are included for the first time for the ‘prison leavers group’
  • The volume for Incapacity Benefit/Income Support volunteers is shifted back within the 3-year funding and reduced by 32%.

The DWP estimates are based on the November 2011 OBR forecasts, with further work by DWP to turn OBR forecast into Work Programme volumes. All economic forecasts come with strong health warnings and the scale of change over the last year shows that forecasts are subject to large revisions. However, we are now two months further on since November and there has been a series of independent forecasts that have continued to worsen. This means that JSA volumes could yet rise above these estimates.

Overall, then, a weaker labour market outlook means higher than anticipated Work Programme referrals and a much bigger challenge for Work Programme providers. In the short term, income from attachment fees will increase. But in the longer term, as I’ve said before, job outcomes and sustainment payments are likely to be harder to gain than DWP would have expected a year ago.

The effect on Work Programme providers will be increased numbers needing out of work support and probably for longer than originally anticipated.

See the government's forecast volumes of attachments to the Work Programme.  

NEW. Spreadsheet with tables and charts for each Contract Package Area comparing the new view with the original view.