Scottish Government

PART IV: CONCLUSIONS

CHAPTER NINE CONCLUSIONS AND RECOMMENDATIONS

9.1 INTRODUCTION

The overall conclusion is that Working for Families appears to have made a significant improvement in the employability of disadvantaged parents. The Working for Families Fund represents an important attempt to develop innovative, targeted solutions to the barriers to work faced by people with families. It was established to invest in new initiatives to improve the employability of parents who have difficulties in participating in the labour market, focusing on the specific needs of the most disadvantaged parents - those who have difficulty entering employment or training because of disability, drug and alcohol or mental health problems, those on low incomes and lone parents pre-New Deal. The Fund seeks to support these groups by helping them find sustainable childcare solutions and provide access to other relevant employability-related services.

This conclusion assesses:

• The overall impact of the funding
• The benefits and effectiveness of the funding for particular groups and in particular circumstances
• The trade-offs between positive outcomes and economic resources used, through cost-benefit analysis
• WFF's implementation
• Recommendations.

9.2 THE OVERALL IMPACT OF THE FUNDING

Overall WFF had a significant initial impact in 2004-06 in terms of recruiting a large number of clients and assisting many of these to make significant progress towards work, education or training. Specifically, 5808 clients were recruited to WFF projects in the ten local authorities. This is a reasonable level for such a programme starting (except in Glasgow and Dumfries and Galloway) from scratch with a largely new set of client groups, and a new combination of economic development and childcare support workers and specialists.

In total, just under half (49% or 2869) of all clients during Phase 1 had achieved an identified outcome, improving their employability and making progress towards sustained employment, training or education, by 31 March 2006 (and many of the others achieved outcomes after that date). Also nearly a quarter (24%) of clients had experienced a Transition at more than one point in time, indicating quite a strong client attachment by many clients to the WFF programme (even after their first Transition) to continue towards enhanced outcomes and the need for long term WFF support for such clients .

41% of all clients achieved 'hard' outcomes - i.e. a Transition of moving into full- or part-time employment; improving or sustaining employment; or entering or completing education or accredited training courses lasting 6 months or more. Of these 19% (472 people) moved into a full-time job and 24% (568) in a part-time job, 13% (324) sustained employment ( e.g. were able to continue in current employment having faced a recent 'crisis' which threatened this employment), 10% (247) improved employment or achieved another employment-related outcome (including 3% who reduced their hours) and 34% (810) entered/completed or sustained education or accredited training of a least 6 months duration.

Given the slow start-up of WFF in most areas, this seems a reasonable number of Transitions and client progress.

Overall most clients found the support of WFF to be very useful, the most useful aspect being in terms of 'providing an opportunity to look for work'.

9.3 THE BENEFITS FOR PARTICULAR GROUPS

The evidence suggests that most WFF clients experienced multiple barriers to progressing towards work, including identified caring responsibilities (identified by 80% of WFF clients); opportunities or skills were a barrier (71%), and 'other issues' (43%). The improvements by clients in reducing these barriers, together with evidence elsewhere in the report, suggest that the holistic approach of WFF is successful in addressing the varied needs of a large number of clients.

Overall WFF successfully focused support on disadvantaged parents in the target groups, who were among the most disadvantaged parents in Scotland ( e.g. in terms of levels of qualification, Benefit dependency, low income and being long-term unemployed etc.). This is indicated, for instance, by:

• The relatively low levels of education and qualifications which indicate that WFF clients were well below Scottish averages.
• Six LAs had more data zones in the worst 10% of Scotland Scottish Index of Multiple Deprivation than the Scottish average. The two rural areas had around a third of Scotland's data zones in the Geographic Access and Telecommunications domain, and North Ayrshire had 15% of Scotland's data zones in the employment domain. The clients of WFF were generally even more concentrated in these disadvantaged areas than the LA averages.
• A higher proportion of WFF clients have children under 5 years old (67%) compared to 37% of parents in Scotland, and so were in need of generally more intensive and expensive pre-school childcare.

In addition, overall the children of clients were relatively young with 95% of lone parent clients having one or more children aged under 12 years living in the household (this proportion is the same for clients in couple households) and 48% having a child aged under 3 years old. None of these were, at the time of WFF Phase 1, prime targets for New Deal for Lone parents. So WFF appears to be supporting lone parents of younger children who wish to progress towards work, training and education. The projects have been client group, rather than postcode led, and this has allowed disadvantaged parents in most LAs to be supported regardless of where they live.

However, the evidence suggests that those with poor qualifications, low employability skills and significant barriers have, so far, been less likely to move into employment. So within the spectrum of disadvantaged groups that WFF clients represent, there are some clients who are particularly disadvantaged and will require longer term support.

A fifth (21%) of clients were self-referrals, indicating a possibly high level of self motivation for them, but this leaves a large majority (79%) who were attracted through other agencies. Together with the low educational levels etc. of WFF clients, it is unlikely that a large share of the positive outcomes is due to WFF attracting relatively high achievers.

The evidence also indicates: the importance of a combination of types of support that are required to improve the employability and outcomes of individual clients; the varying importance of different barriers; and the variations across LAs (see Section 8).

9.4 COST-BENEFIT ANALYSIS

Expenditure on WFF was considerably under budget (around £12.4 million was spent over the two years compared to a budget of £20 million). This was primarily due to the slow start up of the projects, because of difficulties in getting appropriate staff etc. It also appears that emphasis was upon setting up good quality, sustainable projects and that this was more important than maximising budget spend. The budget was almost fully spent (91%) in Year 2 (2005-6).

The cost/benefit analysis of WFF funding needs to take account of the slow start-up period, when set up costs were incurred but there were relatively few clients. Hence Year 2 (2005-6) provides a more reliable estimate of costs. In Year Two figures costs per WFF client engaged on the programme were estimated to be £1,955. For this year, the overall costs per client who had a Transition into work, education or substantial training were around £4,000. (It is expected that these costs may fall in the future as fewer of the clients will have been on the programme for short periods of time and there will be some economies of scale as numbers rise.) These costs exclude those of training and support from non- WFF sources. A more accurate estimate of the medium term costs per Transition will be possible using data from Phase 2.

A comparison control group was set up across the 10 local authorities with 107 randomly chosen parents with roughly similar characteristics, but who had not received support from WFF. The comparator study showed that their moves into work, training or education were very limited compared to WFF clients. This broadly suggests that much of the increase in employment, training or education of the WFF clients is likely to be attributable to WFF support rather than to other changes that would have happened anyway.

There were no reliable data available to show the impact of WFF on childcare services - the national database definitions etc. changed during the life of the evaluation, so they do not provide a reliable baseline. It is therefore recommended that more detailed national and local data on childcare provision and up-take should be gathered if possible.

Costs per 'Hard' Outcome/ Transition were estimated to be £2317 after the start up phase. If only 2005-6 is considered, then the overall cost per client who had a Transition would be around £4000. This would appear to be reasonably low in relation to projects with generally similar types of client groups. This figure will be higher (just under £8,000) if 'deadweight', displacement and substitution effects are taken into account, but there are no accurate measures of these. On the other hand the figures exclude considerable future outcomes (which are expected to be high due to the nature of the clients), life time earnings of clients, family and personal benefits and other benefits due to getting or changing employment, and education etc.

While it is too early to make conclusions, preliminary indications for WFF suggest that the government exchequer benefits ( e.g. through higher taxes and national insurance contributed and lower benefits paid). In addition, the wider long term benefits for participants, including increased life time earnings, improved mental health and other benefits to parents and children etc., are likely to be higher than the financial costs of WFF.

9.5 IMPLEMENTATION

Many lessons can be learned. The lead-in time and cost of establishing a programme such as WFF is considerable, therefore allowance should be make for this in terms of budgeting and advance set-up time .

In all but one area, WFF programmes were based within Economic Development Departments of local authorities who worked with relevant specialist agencies. This choice of location appears to have been successful. It focused the services on the end goals of progress towards work, education or training, rather than intermediate services such as childcare provision per se; built upon departments with skills in partnership working in the area of employability and upon existing partnerships with key agencies; and used the ability of staff to 'speak the same language' with other employability orientated agencies.

There appears to be an overall high level of co-operation and joint working across sectors within WFF, with many projects operated by the third sector and most referrals of clients coming from other agencies (in particular 20% were referred by Job Centre Plus). The approach of continuous information sharing across areas with regular co-ordinators' meetings, appears to have helped cross-learning and problem solving across the LAs and to have helped improve the efficiency and effectiveness of projects.

The key learning is set out in Section 8 for projects based upon: specific client groups; for projects based upon specific issues; and types of childcare.

Other lessons include the speed of implementation. The initial start-up phase was fairly slow during the first six months and the number of new clients fell over the Christmas/New Year period. One overall lesson is that the time needed to get projects fully operational was longer than originally expected (it appears to be around twelve months before a peak of new clients each month is reached). This is partly as it is a new type of initiative involving: cross disciplinary and departmental work, with among others economic development, childcare and education staff; multi-agency; hiring staff where there is often a limited pool of suitably experienced and qualified staff; and generally setting up new projects or forming new partnerships with existing organisations. Setting up a service from scratch could also be more costly and time-consuming, as opposed to buying into an existing similar service from within or out with the local area,

The long lead-in time for many projects was particularly true for childcare projects. Childcare infrastructure projects could be expensive, have a long development time and be subject to considerable paper-work ( e.g. that involved in Care Commission approval).

Hence lead-in time should be carefully considered when budgets are set, with the expectation that only a few staff may be employed and relatively few clients assisted in the first few months. Secondly when expanding out WFF, training of project and local authority staff should be carefully considered, including in employability, childcare and partnership issues. Thirdly, mechanisms need to be in place to ensure learning from good practice elsewhere for both new local authorities and projects joining WFF and for existing LAs and projects. Fourthly, consideration should be given to new areas being brought into WFF in a phased way

9.6 RECOMMENDATIONS

The recommendations from Phase 1 are as follows. (Some have already been adopted in Phase 2):

• Greater recognition should be given to the long lead-in and start-up times required for programmes such as WFF, with account taken of the impacts upon budgets, timing of the programme and expected outcomes.
• WFF should continue with a focus in the Economic Development departments of local authorities. However, local partnerships with employability and childcare bodies and organisations providing other services, at both strategic and operational, frontline delivery levels, should continue to be progressed and their importance should be stressed.
• The focus on the Key Worker models of providing consistent, flexible and tailored support on employability and childcare issues should be continued. In addition, the developing Key Worker models should continue to be investigated on an on-going basis, with lessons identified and distributed widely among interested parties. It would also be useful to investigate providing Key Workers with more formal specific training or support in condition management, as used in other employability projects for clients relatively far from employment, such as 'Pathways to Work'.
• Due to the relatively long start-up time, and hence limited periods that most clients have been supported by WFF, further analysis of outcomes by types of projects and of clients should be continued using data from Phase 2. This should include what appears to work best.
• Continued monitoring and investigation into the importance of different types of support ( e.g. transport, forms of confidence building etc.) should be, and is being, carried out in Phase 2. In particular more projects directly working with employers, which might attempt to better meet the combined needs of employers and WFF clients, should be encouraged and lessons learned. Particular support is needed for those with strong barriers and a lack in employability skills and qualifications. While WFF is focusing on people on low income in Scotland, within the WFF client groups there remain some who are currently achieving less and may require further support over a longer period.
• Clearer targets, concerning client numbers and expected outcomes based upon knowledge from Phase 1, should be set for any future WFF local authorities and projects, as they have been in Phase 2.
• Prime focus of Working for Families should be on 'hard' outcomes leading to major improvements in the position of clients (such as moves into or sustaining work, substantial training and education) rather than on 'softer' outcomes. However, 'soft' outcomes are also important and should be recognised. More information on 'soft' outcomes (such as consistent intermediate activities like short term training) should be gathered and this is underway in Phase 2.
• Greater childcare information should be collected, and consideration should be given to altering the annual Census of Children's Daycare and Pre-school Education Centres so it can assist in providing a basis for a consistent, longer-term picture of childcare availability, supply and cost, in order to assist in the development and evaluation of the effects of increases public expenditure on childcare.