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Payment by results ruled out for pilots

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Civil servants have ruled out the possibility of community budget pilots using payments-by-results models to fund schemes aimed to get families with complex needs back into work.

A Department for Work & Pensions paper, obtained by LGC through the Freedom of Information Act, said such models would be the preserve of the Work Programme, the government’s new national unemployment programme to be delivered by large services companies.

The briefing paper, which outlines DWP’s “offer” to the community budget pilots, said benefit claimants in families with “multiple disadvantages” covered within the community budget pilot areas would be “included in the funding model for the Work Programme”.

It said: “The government would not be able to re-design the Work Programme to remove adults in families with multiple disadvantages, nor to allocate the benefit savings from supporting those adults into a separate local authority-level payment by results scheme.”

LGC understands a handful of the 16 community budget pilots are still exploring a payments-by-results model through mechanisms other than benefit savings.

The DWP paper shows that the extent of Iain Duncan Smith’s department’s offer to the pilots is to “maximise responsiveness and flexibility” of Jobcentre Plus (JCP) teams. It added that there may be potential for the “pooling” of a limited amount of funding available to JCP, but that would be at the discretion of each JCP chief executive.

Another briefing paper noted that because the Work Programme was “outside the scope of the place-based- budget proposals” this “reduces the potential” of the community budget pilots.

DWP is one of several departments showing limited engagement ahead of the launch of the community budget progarmme next month.

In February, senior local government figures warned the programme was at risk of collapsing, while papers obtained by LGC showed little or no engagement with the programme from several departments, including the Home Office, which was meant to be a key player.

LGC revealed the government had established a ministerial group to drive forward the programme, with A4E chair Emma Harrison set to work with six of the pilots, which will be awarded ‘exemplar project’ status.

A DWP briefing paper from 27 January said these are to be likely be Hull, Blackpool, Birmingham, Islington, Lewisham and Westminster. However, a Department for Education spokeswoman said the projects, which will receive £300,000 over 2011-12 and 2012-13, had yet to be finalised.

According to the Local Government Association, 30 bids for Exemplar status were submitted, with the Community Budgets Group chaired by Lord Bichard to review them at their meeting this week.

LGC understands Ms Harrison’s role will be to work with specific families as part of the prime minister’s drive to get “troubled families working again”.

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