So what are the problems with Workfare?
On the face of it ‘workfare’ style programmes you might not think that there is a problem with 'workfare', although many people disagree. There is now a great deal of international evidence that demonstrates that this type of approach does not work; does not create jobs; can actually harm a person’s long term employment prospects; is costly to manage, and is open to wide scale abuse from “workfare” programme providers. All of this evidence is well documented. The UK Government and the Department for Works and Pensions (DWP) are aware of this critical body of evidence against ‘workfare’ style programmes.
In 2008 the DWP published it's own report A comparrative review of workfare programmes in the United States, Canada, and Australia which clearly highlights these area of concern
Workfare is voluntary and gives people valuable work experience
The Government have been claiming that participation in these schemes, is voluntary and people are free to leave work placements without it affecting their benefit. Bizarrely, they then add that if they leave a scheme after the first week without good cause they will face sanctions.
Every aspect of these schemes is ‘mandatory’, the legislation and guidance consistently use the term ‘mandatory,’ and in order to take part in a work placement people have to be ‘mandated’ (although there is evidence that the government have attempted to cover up this last point). As Work Providers are only paid by results there is an inbuilt incentive for them to ensure that people take up ‘voluntary’ placements and put pressure on someone to work, or face the threat of losing their benefits.
Forcing or coercing someone to work for no pay is clearly wrong. The Human Rights Act, Article 4.2 states “No one shall be required to perform forced or compulsory labour.” This is an absolute right, it can never be restricted.
According to the Equality and Human Rights Commission the only time this does not apply to is when the work is part of a prison sentence or a community sentence, or when the work is required by government during a state of emergency.
The Economic Arguement.
The DWP and National Audit Office have said that the costs of The Work Programme will be £3b - £5b over 5 years. The DWP also say that they estimate that for every £1 spent there will be a saving of £1.95 despite all of the international evidence against this assumption.
Leading International expert Dan Bloom (Director of Health and Barriers toEmployment at Manpower Demonstration Research Corporation MDRC) In his report After AFDC: Welfare to Work: Choices and Challenges found that: “participants believed that the employer got the better end of the bargain" and that "there is little evidence that mandatory work programs help participants find unsubsidized jobs, or reduce welfare caseloads or spending." Similar findings a replicated in studies from accross the world.
There is no guaranteed job outcome with ‘Workfare’ programmes. These programmes do not create employment the aim to place people into jobs that already exist. Many of the placements have been in the retail sector, which has seen an ‘avalanche of job losses’ within the sector. In 2009 alone a study by the Centre for Economics and Business Research (CEBR) predicted between 100,000 and 135,000 job losses. There is no shortage of unemployed people needing work experience and skill in the retail sector.
The £3b - £5b that the work programme will cost could be used to create real jobs or real community benefit such as repairing our decaying roads, or working within the NHS another sector facing cuts. At the current UK Living Wage level the same money could be used to create between 43000 and 65,000 new jobs. Even at the basic JSA rate this will save between £0.6m and £1b; it will generate the same amount in Income Tax and NI; and another at least £1b in consumer taxes. At the same time these new jobs with give a well needed boost to the retail sector either protecting existing jobs or creating new ones.
Economically it just makes more sense to actually create jobs.
Wide scale benefit fraud from people are ‘workshy’ and ‘lazy’
These stories have become widely popular in the press over the last 10 years and are often aimed at ill and disabled people. The DWP aim to extend ‘workfare’ provision to sick and disabled people over the next year.
Levels of benefit fraud are actually very low, particularly in Incapacity Benefit. DWP figures show that only 0.3% of Incapacity Benefit claims were fraudulent. That did cost the tax payer £20m, but put this into context, the DWP also say that through official DWP error £40m (0.7%) was underpaid to IB claimants, and through DWP Official error the DWP overpaid £70m (1.2%) to claimants.
At the same time the DWP and David Cameron have been aware of suspected fraud from workfare provider A4E since at least November 2010, yet have continued to award them multi-million pound contracts.
