Welfare to work = job losses & multinational profits

Phrases of the day are: Reserve army of labour, Workfare, and McJob

Hey, let’s get sick people into work!

But first, let’s make some employed people unemployed!

Yes, thousands of people will lose their jobs at the Department of Work and Pensions…

PCS condemned today’s announcement to slash a further 12,000 jobs and the closure of an additional 200 offices in the Department of Work and Pensions (DWP). The union also accused the government of a dogmatic approach to the privatisation of the welfare state as it confirmed plans to implement the Freud report in full.

With 30,000 jobs already gone and over 600 offices closed in the DWP, the union expressed its deep concern of the impact that further cuts will have on service delivery. Services to some of the most disadvantaged in society have already suffered as a result of job cuts and office closures, with access to benefits and job seeking help restricted and increasing waiting times for benefits resulting in food parcels being handed out in some parts of the UK.

Accusing the government of pursing a dogmatic policy of privatisation, the union warned that the welfare state was in danger of being run in the interests of shareholders rather than the people it was set up to help.

The union went on to warn that further job cuts combined with privatisation would amount to a huge blow to the morale of staff, who are in a long running dispute over the imposition of a below inflation pay offer, which sees 40% of staff receiving a 0% pay rise this year.

The union will be raising today’s announcement in talks with the Cabinet Office aimed at reaching a negotiated outcome to its national dispute over jobs, services and privatisation. The union is seeking agreement on the avoidance of compulsory redundancies and measures to protect the workforce in the event of privatisation.

Commenting, Mark Serwotka, PCS general secretary, said:

“This announcement comes as yet another blow to a workforce who have battled to provide a service in the face of swingeing cuts and below inflation pay increases. These plans for job cuts and privatisation are purely about crude cost cutting and will do nothing to improve service delivery to some of the most disadvantaged in society. The government, by planning to privatise large chunks of the welfare system, are effectively turning their back on vulnerable members of the public as well as its own public sector workforce, who have consistently outperformed private companies in delivering the lowest unemployment in a generation. Today’s announcement adds renewed urgency to talks with the Cabinet Office in reaching a negotiated outcome to the union’s national dispute as we seek to reach agreements on compulsory redundancies and privatisation.”

And in the capitalist press:

American and Dutch companies are following their Australian counterparts in targeting Britain’s job placement market as the government announces a significant expansion in the private sector’s role in welfare-to-work.

James Purnell, the work and pensions secretary, will today set out a near four-fold increase in the market for private and voluntary organisations to get the long term unemployed off welfare and into work.

He will announce bigger and longer contracts – for at least five years rather than the present three – expected to be worth around £360m a year for the “flexible New Deal”. At present £100m or so is spent on the independent sector contracts.

Some 80 per cent of a contract’s payment will be dependent on actually getting people into work and keeping them there. The biggest payment is likely to depend on people staying in work for six months rather than the present 13 weeks.

In some parts of the country providers will compete within the same area in the hope that will stimulate performance and give the unemployed – and increasingly lone parents – some choice over who provides the personalised service aimed at getting them back to work.

The move is the first step towards implementing the recommendations of the Freud report that envisaged a “multi-billion pound” welfare-to-work market for private and voluntary providers that would attract “major players” from around the world.

In evidence this is beginning to happen, ResCare, one of the biggest US providers of welfare-to-work services has bought Biscom, a small UK provider of job training and placement services as well as Maatwerk, a Dutch company in the same sector that already has some small contracts in the UK.

Maximus, another big US provider, is also looking for a UK acquisition while it and America Works, which operates in New York and California, have both been present at supplier meetings with the Department for Work and Pensions.

Igneus, the Australian company, already owns Work Directions, the UK based welfare-to-work provider, while Mission Australia, the charitable provider, has bought a stake in Working Links, the public- private partnership owned by the government, Manpower and Capgemini.

The big UK services companies, Capita and Serco, are seeking to enter the business alongside domestic providers of the existing programmes such as A4e and Reed-in-Partnership.

Calder, the Dutch company, recently bid unsuccessfully for a Pathways to Work contract, with Lambert Verwijst, its sales director, saying “we would definitely like to be in the UK. It is an interesting market and not so different to Holland”.

Peter Cove, founder of America Works, says his company had agreed an outline contract to work with lone parents with the outgoing Conservative government in 1997, only for Labour to cancel it on taking office. Now, he said, he believes the market for private companies in the UK “really is at a tipping point”.

Mr Purnell is expected today to underline his determination to implement the Freud report in full, with the private sector’s involvement “here to stay and set to grow” , although a big programme to tackle the 2.6m people on incapacity benefits has yet to be agreed.

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One Response to “Welfare to work = job losses & multinational profits”

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