A matter of personal taste
Author: Adam MarshallDate: 23/09/2008
Publication: Whitehall and Westminster World
Getting people into work
The Department of Work and Pensions, with its national responsibility for welfare benefits, is a prime example of a Whitehall department whose expenditure has an impact on local economies across the country. Yet benefit payments, the structure and coverage of New Deal welfare programmes, and the activities of JobcentrePlus are all determined nationally.
Not all of these functions need to be designed and delivered from the centre. While it is right that welfare benefits and entitlements are determined nationally, programmes designed to boost employment need to be linked more closely to local labour markets and local economic conditions.
The Government's drive to reduce worklessness is a prime example of a policy in need of localisation - not just personalisation. Worklessness is principally an urban problem, and requires an urban solution. Urban areas contain 59% of Britain's population - but are also home to 64% of the workless, and 68% of all benefit claimants.
If we continue with the current, national approach to tackling worklessness, ministers' goal of an 80% employment rate is unlikely to be achieved. In recent years, national initiatives - such as the New Deals have largely failed to move those furthest away from the labour market into work. What's more, these programmes have had lower success rates in our cities than in suburban and rural areas.
James Purnell was quick to recognise the importance of devolution upon taking up his post as Secretary of State for Work and Pensions. In a major policy speech in June, he promised a "triple devolution" to individuals, back-to-work service providers and to communities. To date, however, there's a gap between Ministerial rhetoric, and reality on the ground.
We should hold Purnell to his word on devolution - and press for locally-controlled back-to-work programmes in our biggest cities, tailored to employers' needs.
The DWP's commitment to widen its ‘City Strategy' initiative - a dialogue between national and local interests on employment issues - is not enough. We believe that our biggest city-regions need direct control over back-to-work and training budgets, through powerful new Skills and Employment Boards.
As a recent Local Government Association report has noted, existing back-to-work and training programmes are ‘rule-bound', and often don't fit the needs of local economies. City-regional Skills and Employment Boards - covering real economies like Greater Manchester, Merseyside and Tyne and Wear - would be closer to local labour markets, than Whitehall politicians. Each Board would be given control of budgets for local back-to-work and training programmes, using funds devolved from the DWP, Job Centre Plus and the new adult Skills Funding Agency.
Business leaders and employers would sit on these Boards, alongside elected city leaders and training providers. Employers would be able to shape and direct bespoke training programmes that fit the needs of their local economy. Local business leaders would be challenged to identify the workforce skills they need - and in return would be given a much bigger role.
Since Boards would work locally, rather than to a prescriptive national framework, they would be better able to prioritise resources on targeted programmes - such as specialist training and childcare support - that help city residents to access jobs and get back to work once and for all. Additionally, Boards would help our cities to get through the current economic slowdown by linking individuals with vacancies and re-training programmes.
Breaking the deadlock
What can national politicians and senior Whitehall officials do to overcome their centralising instincts - and improve public service delivery?
First, recognise that it's possible to localise and personalise at the same time. City leaders have a better understanding of local labour markets than Whitehall officials, and are in a far better position to link public services directly to citizens. Devolving power and investment decisions down to cities and city-regions will result in more responsive public services - and more successful communities.
Second, departments should take a careful look at whether their organisational structures give them an adequate spatial focus. The Department for Transport's recent re-organisation provides some important lessons. By shifting many civil servants into a directorate focused on city and regional issues, the DfT is developing a stronger ‘sense of place', devolving decision-making, and prioritising investment resources.
Third, Whitehall officials need to spend more time getting to grips with how their work directly affects particular cities and regions. Cross-departmental working has improved in crisis situations - such as the closure of the Longbridge car plant in 2005 - but most big policy ideas are still developed in the same old silos. Unless new thinking is better linked-up at the centre, there's little chance that ‘personalised' services will really have the desired effect on the people of Britain's cities and towns.
And finally, politicians need to transform ‘devolution' into something bigger than a watchword. If we want successful cities - and public services that really respond to the needs of their residents - then both Labour and the Conservatives need to set out how they will devolve real power downward from the centre. Employment and skills would be a good place to start.
A version of this article first appeared in Whitehall and Westminster World
