To ensure welfare-to-work support is responsive to local conditions, we propose that a new national programme for mainstream jobseekers is established alongside a localised programme for those facing greater barriers to finding and sustaining work.

The Work Programme, intended to help people facing labour market disadvantage, is letting down people and places with weak labour market prospects.

As it is currently configured, the Work Programme is far from being an effective system of employment support. It is underperforming in three distinct ways.

  • First, it is not delivering for those who need help most, despite the complex rewards system put in place to incentivise more intensive support by contractors.
  • Second, it is not taking into account local labour market conditions, and worse, locks contractors into a vicious cycle of underinvestment (and this in the parts of the country that need more, not less, money spent helping the long-term unemployed).
  • Third, it is failing to coordinate and sequence with local delivery of other public services, and to align with local demand-side measures that, if brought together, could deliver a more coherent package of employment support.

Given the current financial pressures placed on all government departments – and local authorities – this is simply an unsatisfactory way of delivering the high-quality public services required by people who need work.

In this report, we assess the benefits of a business-as-usual with tweaks model and a fully decentralised option. However, we recommend a third option, mixing national and local provision. This would make a fundamental split between services for those who are closest to the job market (broadly, those on JSA) and for those who are hardest to help (broadly, those on ESA), with the former operating nationally and the latter locally. By doing so, it would allow local employment support services to develop stronger links with individual claimants and to respond more sensitively to local labour market and economic conditions.