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Warning over welfare switch to private sector

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Government efforts to tackle unemployment and rebalance the economy will be undermined if its welfare reform programme relies entirely on the private sector and does not include a key role for cities, Manchester City Council chief executive Sir Howard Bernstein has said.

Speaking on the fringe of the Conservative party conference, Sir Bernstein, left, said it was “absolutely crucial” that the welfare secretary Iain Duncan Smith’s plan to replace a wide array of welfare-to-work schemes with a single Work Programme include councils within the commissioning process.

Under current plans, the government intends to roll out the single Work Programme across regional areas that will be commissioned centrally by the Department for Work & Pensions, with large private companies favoured to win the contracts.

Those regional “prime contractors” will then subcontract the programme into sub-regional lots, but there is no guarantee that councils will be involved in this process or that the sub-regions will be coterminous with new Local Enterprise Partnership areas.

Mr Bernstein said proposed LEPs, like the Greater Manchester area, were the ideal spatial area to focus the Work Programme.

He said: “Of course in welfare there has to be a national model, but you’ve got to create space within that for partnerships at the sub-regional level and we’re not seeing much of that at the moment, to be frank.”

Mr Bernstein said DWP must ensure that there is an obligation within the commissioning process for contractors to engage with local authorities.

He said: “If they don’t then [ministers] have not learnt the lesson of the last decade: you will not deliver local results with national models. It is crucial that local partnerships are involved and if they are not we will not be able to tackle deprivation the way the government wants.”

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