DWP's postpones announcement of FND preferred bidders

The Department for Work and Pensions (DWP) was due to announce preferred bidders for flexible new deal contracts this week, but James Purnell, work and pensions secretary, has postponed the statement. Potential providers argue that high unemployment and low numbers of vacancies mean the scheme is no longer viable, which, the Observer writes, has put the flexible new deal in crisis

The DWP wrote to organisations that are bidding for the flexible new deal last week, acknowledging that its initial estimate, 100,000, of the number of people who will be out of work for longer than a year is likely to have trebled.

Firms bidding have argued that the flexible new deal will fail unless changes are made to the way it is paid for. The contracts are heavily results based, relying on getting people into sustained work.