http://www.personneltoday.com/articles/2007/11/19/43309/government-to-transfer-jobcentre-plus-work-to-private-sector-in-welfare-reform-shake-up.html

"Government to transfer Job Centre Plus work to private sector in welfare reform shake up"

"Seven-year contracts for welfare-to-work providers, to allow long-term investment in services and staff training"

"welfare-to-work provision - among other public services - would be turned over to private providers on a previously unimagined scale"

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Have you Heard of a Company called A4e? Most of you probably haven't. They are one of the companies who the government will be paying to take those who have been unemployed for more than 12 months off the unemployment register:

http://www.docstoc.com/docs/6788626/A4e-New-Deal

It's called the FND (Flexible New deal). Under FND, "claimants out of work for 12 months or longer will be referred to private contractors who will be paid by results to find them work".

The reason this is being done is to save money, up to £1 billion in a year. So, a company will be making a profit and the government will still save £1 billion a year?  Call me stupid, but why can't the government just do exactly what those companies were going to do and save over £1 billion a year? This would of course keep accountability and monitoring in-house too.

Problems are already appearing: the FND is "facing demands from three times more applicants than first predicted", and funding is "inadequate". I predict here and now that this will quickly turn into a catastrophe and that the companies won't have to carry the can.

There is a huge worry: "... that contractors will be tempted to spend money getting people into jobs who are easier to place ... the challenge and the danger created by the most disadvantaged is that they'll get the least resources precisely because the provider has assumed they won't get a job".

This could be very bad news for the disabled, for example, as well as others.

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The news isn't good where other countries have tried this:

http://www.personneltoday.com/articles/2008/04/16/45432/the-hidden-dangers-of-outsourcing-welfare-reform.html

"... where other countries had implemented similar welfare reforms, their experiences had been mixed. It uncovered abuse of the system, with private providers defrauding government departments and deliberately keeping unemployed people out of work until they became worth more money to place in a job"

""There have been cases of 'creaming' and 'parking', where service providers concentrated on those jobseekers that were the easiest to deal with or delayed and sometimes even ignored the most challenging cases.

"In Australia, success fees were fraudulently paid to employers taking on jobseekers for a limited period"

Welcome to the future.

Cheers, Tom.