Oireachtas Joint and Select Committees
Thursday, 4 April 2019
Joint Oireachtas Committee on Social Protection
Indecon Reports on Job Clubs and Local Employment Services: Minister for Employment Affairs and Social Protection
Apologies have been received from Deputy Bailey. I welcome everyone to the meeting. I remind members with mobile phones to switch them to flight mode or off completely.
In accordance with standard procedures agreed by the Committee on Procedure and Privileges for paperless committees, all documentation for the meeting has been circulated to members on the document database. Copies of the Minister's opening statement are available if anybody does not have one.
The purpose of today's meeting is to afford the Minister for Employment Affairs and Social Protection, Deputy Regina Doherty, an opportunity to comment on the Indecon reports on local employment services and job clubs. In a few moments, I will invite the Minister to make her opening statement after which members will have an opportunity to raise questions with her.
I draw the attention of the committee to the fact that by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. However, if they are directed by the committee to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable. Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise, or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable.
I thank the Minister for attending. She realises that this is a two-part process and I am sure she has seen the presentation made by the witnesses who came before the committee earlier in the week. In the context of the points they raised and the presentation they made, we are interested to hear the comments of the Minister on the matters as they presented them.
I thank the Chairman and members for the invitation to discuss the Indecon reports we published earlier this year. I am looking forward to the questions of committee members arising from the presentation of the Irish Local Development Network.
Before discussing the reports, it would be useful to give a brief overview of the evolution of policy and practice in the area of activation and the direction these reforms have taken. The period from 2011 to 2019 has seen significant reforms to the Government’s approach to supporting people who are unemployed in their return to the labour market. The changes have included streamlining and reorganisation of the services on offer from the Department through Intreo; the introduction of new services and schemes, including recruitment subsidies such as JobsPlus; work placements under JobBridge; tailored training under MOMENTUM and conversion education under Springboard; an increase in the number of case officers directly employed and indirectly provided via contract; the tailoring of the Department's approach to jobseekers using the model developed by the ESRI; and increasing the number of places on, and adjusting the approach taken within, State employment schemes, such as community employment, Tús and the rural social scheme. The Department has also developed an employer engagement strategy and a team to work very closely with employers on initiatives such as JobsPlus and national jobs week, which ran very successfully last week. I pay tribute to all of the organisers and participants as it really was a success.
In all of these initiatives, we applied the principle of rights and responsibilities to encourage people in receipt of payments for jobseeking to actively engage with all or some of our services.
All of these changes were developed and implemented as part of the pathways to work strategy based on expert research and advice from bodies such as the OECD, ESRI and NESC. Of particular relevance is the 2009 OECD report on activation policies in Ireland, the 2010 ESRI report on employment services and the 2011 report from NESC on services and supports for jobseekers.
The changes were overseen and guided by the Labour Market Council comprised of experts such as Dr. John Martin, former head of employment and social affairs at the OECD, Professor Philip O’Connell of UCD, Ms Bríd O’Brien of the Irish National Organisation of the Unemployed, INOU, Dr. John Sweeney of National Economic and Social Council, NESC, Dr. Peter Rigney of ICTU, and Mr. Tony Donohoe of IBEC together with senior leaders from a number of large employers
These changes have not only borne fruit but have been, in the main, warmly welcomed, by the jobseekers we serve. The evidence for this can be seen in the reductions in unemployment and, in particular, long-term unemployment as we emerged from the recession that lasted from 2009 to 2013. This labour market recovery differs markedly from that witnessed in Ireland following previous recessions or what was witnessed in other countries affected by that global crisis. In previous recessions, it took more than six years of sustained economic growth for unemployment to respond and even longer for long-term unemployment to fall. This time around the experience has been different.
Although it is difficult to attribute this performance in a quantitative way to specific actions and measures, there is some evidence the committee should consider. Econometric studies of JobBridge, the back to work education allowance and JobPath, together with a value for money review of JobsPlus, all indicate a positive impact on employment outcomes for participants compared to non-participants. The recently published ESRI econometric assessment of the streamlined Intreo process commissioned by my Department indicates that the reforms improved exits from the live register.
Furthermore, external commentary on the economy by the OECD, EU and IMF have singled out our activation reforms as being particularly effective in contributing to reducing unemployment. Reviews of the Intreo process reforms by the INOU and by the European network of Public Employment Services have also been positive. Perhaps most important, our customer satisfaction tracking research, commissioned externally and conducted independently, indicates high levels of customer satisfaction with the service and the services offered.
All of this evidence suggests that we do not need to implement major reforms of our approach to activation. We now operate in line with best practice internationally. That is not to say that we cannot do better and, in particular, that there are not changes that we need to make to adjust to our improving economic situation. It is in this context that the two Indecon reviews on local employment services, LES, and job clubs were published last January will be considered. Members will agree that the reviews are broadly positive regarding the impacts of the LES and job clubs, recognising the role the LES play in engaging with those furthest from the labour market as well as the useful role of job clubs in working with more job-ready clients. Nonetheless, the Indecon reviews make several useful recommendations that are being considered by my Department.
Transitioning to multi-annual contracts from the current annual contracts, as suggested in the reviews, would enable contractors to plan for the medium term while the enhanced use of performance metrics would enable my Department to ensure that the performance of contracted employment services are of benefit to jobseekers and of value to taxpayers.
On procurement, the Indecon reviews suggest that open or public competitive procurement be actively considered. A move to competitive procurement is also consistent with legal advice my Department has received with regard to its obligations under EU procurement legislation. Accordingly, this is a matter that is currently receiving active consideration.
In December, I had the privilege of addressing the Irish Local Development Network, ILDN, conference where I informed the delegates that the Indecon reports would be published in early 2019. There were naturally some concerns and nervousness due to delegates not having seen the reviews but we assured them they had nothing to be nervous about and that once the reviews were published, we would meet them and discuss the reports.
Senior officials from my Department met representatives of the LES and job clubs on 25 January last, shortly after the publication of the reviews. They were joined by a partner from Indecon responsible for drafting the reviews who presented his findings and took questions. The LES and job clubs have broadly welcomed the Indecon reviews and I am happy that they are positively engaging with my Department, as they always have. The continued longevity and success of LES and job clubs cannot be based on standing still or an assumption that contracts will be renewed irrespective of legal requirements or service performance considerations. From our discussions it is clear that the LES and job clubs understand that they need to adapt to changing circumstances. It is encouraging to see their openness to change and reform and I am optimistic that we will continue to benefit from their services for years to come.
An econometric review of the JobPath service by the Department's statistics unit, led by a senior statistician on secondment from the CSO with support and input from the OECD, is nearing completion and I expect that the results will be published next week.
Some commentators have sought to present the service procured via JobPath as being somehow in competition with that procured via the LES and job clubs. This simplistic presentation which has been put to me on numerous occasions is also misplaced. To be clear, it is my view, and that of my Department, including people who were there long before me, that these services complement rather than compete with each other.
The evidence in Ireland, just as in every other labour market around the world, is that people who are long-term unemployed face significant challenges in securing employment opportunities. For some long-term unemployed people, the period of unemployment is prolonged; this requires that there is a mix of services and service providers available to them over this period. That is why we have LES and job clubs, JobPath, State-employment schemes such as community employment and Tús and a mix of education and training schemes via SOLAS and its contracted service providers.
Services can at different stages of unemployment offer different opportunities and supports to unemployed jobseekers. Currently, with approximately 77,000 long-term unemployed people on the live register and a further 45,000 engaged in programmes such as community employment, CE, there is more than enough work for all of our service providers. There may be a fear that a particular mindset is present but unfortunately there are more than enough unemployed people for all our services to help. We would not be able to do what we need to support those people without the support of all our services.
Looking at the future, the development of our service strategy will be driven by the twin purposes at the core of all public employment services. First, the activation function of Public Employment Services, PES, is to facilitate the smooth functioning of the labour market by encouraging labour market participation and reducing what economists call "friction" as people enter, leave or move within the workforce. It does this by trying to ensure that unemployed workers are matched through advice, counselling, work experience and training to job opportunities and to ensure that the job opportunities are in fact notified to, and made available to jobseekers. Activation also means working with employers to make it easy for them to take on workers and specifically to encourage them to give unemployed workers, whom they might not otherwise consider, the opportunity to prove their worth and continue to work in the organisations where they get work experience.
The second core purpose of PES is social inclusion. To ensure that unemployed workers are not disenfranchised by not having the social or family capital or network that gives them access to employment opportunities. It is not simply enough for the State to passively provide income supports and then leave people to figure out on their own how best to find and sustain employment. We have a duty to offer supports in the form of advice, work experience opportunities, training and education and occupational activities to all jobseekers. In doing this, we provide a social capital or a public network to all unemployed workers that can help redress any inequality arising from differences in social and family capital.
This twin purpose of activation and social inclusion applies regardless of the economic backdrop. However the challenges faced in delivering on this purpose changes as employment conditions vary.
We are, at this stage, moving from a position of having an excess supply of labour to one where labour supply is tightening. This challenges us to create opportunities to bring more people into the labour market and to extend our services to other groups of people whom we could not reach, given constrained resources, during recessionary times. This includes improving and expanding services for women not currently active in the workplace, but who want to be, and similarly for people with disabilities. We are also moving from a position where many unemployed people had a strong record of prior employment to one where those people who are now long-term unemployed are increasingly characterised by weak labour market attachment and significant employment barriers.
This group of people requires more intensive support, delivered via a mixture of services and service providers, as I have outlined.
The Department is currently reviewing how it will adapt its services to address these challenges. This is unlikely to require a major overhaul of service provision. However, it will require a refocusing of effort and it is more than likely to require some redesign of our services to attune them to the needs of people facing significant barriers to taking up employment. We are in the process of designing the activation and support services for the next generation. At the moment we are lucky enough for our unemployment numbers to be coming down but these programmes need to be scalable. If anything happens to employment in this country again, God forbid, we need to be able to scale them up easily. The changes we have made to the design of the youth employment support scheme, YESS, which helps young people with significant barriers to employment to gain valuable workplace experience, are an example of the redesign of schemes that were working but can have a much more positive impact with a small number of tweaks.
One thing that I will not do is make the mistake made by previous administrations, with all due respect to them. In periods of economic growth the State's PES were effectively allowed to wind down and wither through disuse because we did not need them. This happened without any acknowledgement that we would need to be able to turn on the tap again. In any future downturn in the economic cycle we do not want to have to rebuild the PES from scratch, as we unfortunately did between 2011 and 2015. Although we have had major success, there is no doubt that we lost too much time in rebuilding the service. This led to a situation where we entered the recession with far more people unemployed than would have been the case if the public employment service had been operating effectively for the previous several years.
A 2009 estimate from the OECD suggested the number on the live register was approximately 100,000 higher than it would have been if the PES were operating to best practice levels in those years. In refocusing our efforts I will not countenance any reduction in capacity. Between Intreo, LES and JobPath staff, we have approximately 800 case officers at present. At a minimum I intend to maintain that capacity to the extent that I can, given available resources. I also intend to extend the Department’s service offerings to help other groups to access employment opportunities; people with disabilities and people, mainly women, who left employment to mind our children.
I believe that these are objectives on which we can all agree. I look forward to hearing the committee's views and answering any questions.
The Minister will not be surprised that I have a few observations and questions. I eagerly awaited the opening statement which arrived late this afternoon. I read it with some interest. I thank her for coming before the committee, presenting her opening statement and addressing questions. There is an awful lot of concern out there. She has engaged positively with the ILDN but there is also a lot of fear. That fear was echoed by representatives of the ILDN and SIPTU when they came before the committee. There are concerns about the future for the LES and for job clubs. The Indecon report shows what a massive success they have been. Some statistics jump out. In 2012, we had an unemployment rate of 16%; it dropped to 6.7% before the onset of JobPath. This clearly shows that the successful schemes that were in place were making a massive impact in addressing the unemployment crisis we had at that point. The Minister says that JobPath has been the most successful labour activation scheme in the history of the State and cites the drop in unemployment figures. However, this drop had started and was brought about by the successful schemes that had been in place.
The Indecon report also shows that the LES achieved a 28.8% success rate. The target was 30%. My concern is that the Minister and the Department do not account for the fact this figure only records people who take up employment for more than 30 hours a week. It does not account for the people who are engaged in part-time employment or work for fewer than 30 hours a week. It does not account for people who have gone into education, upskilling, training or anything like that. The achievement rate is considerably higher than the 28.8% listed. We can compare that to the alternative scheme that the Minister cites, namely JobPath. That scheme's target was 14% and it struggles to achieve that despite the money that has been put into the JobPath programme, Turas Nua and Seetec. More than €162 million has been spent and just over 11,000 people have entered employment that is sustained for 12 months or more.
Several concerns were raised in our engagement with the ILDN. Its representatives acknowledge that some changes are needed. They will state that openly. They are not afraid of change or of adapting. They know they cannot stand still. One recommendation that jumps out at me from the Indecon report is the move to competitive procurement. I would like to tease that out with the Minister. Her written submission states: "A move to competitive procurement is also consistent with legal advice my Department has received with regard to its obligations under EU procurement legislation". I would like to see the legal advice the Minister has received. The ILDN gave a number of different examples, though I cannot find them now-----
They cited specific programmes that were allowed to proceed without the requirement for open competitive procurement. I quote the presentation made by Mr. Donal Coffey to this committee on behalf of SIPTU:
A clearer reading of EU guidelines on competition policy and rules pertaining to state aid outlines how member states can work within the EU procurement environment while still protecting services of general interest... Services of general interest expressly include services provided directly to the person, such as social assistance services, employment and training services, childcare, social housing or long-term care of the elderly and people with disabilities, according to Murphy and Deane.
This shows that we do not have to have a procurement process. The guidelines are there. I would be interested to see the legal advice the Minister mentioned.
Her submission also states "services complement rather than compete with each other" and "there is more than enough work for all our service providers". That is interesting. I have challenged her on this time and time again. CE schemes throughout the State are struggling. There is a massive number of vacancies on them. She will say that this is because there is less unemployment and there are not enough people to fill them. That is nonsense. The number of referrals to JobPath continues to increase. More than 206,000 people have been referred to JobPath. People are now being referred to JobPath for a third year. They are essentially doing exactly the same thing time and time again. The initial referral of €311 is paid not just once or twice but three times. It is paid for doing exactly the same thing. There is competition there. People are being referred to JobPath and that is unfortunately impacting on the other schemes.
There are a couple of other interesting lines I would like to touch on.
As was mentioned, this is unlikely to require a major overhaul of service provision but it will require refocusing on effort. I ask the Minister to tease that out a bit, because she also said that between Intreo, LES and JobPath staff we have approximately 800 case officers at present. The contract for JobPath, Turas Nua and Seetec concludes this year. Is the Minister clearly stating there is a role for JobPath into the future? Will there be a renewed contract with JobPath, Turas Nua and Seetec? The Minister will be aware of a cross-party Dáil motion calling for the ending of referrals to JobPath and solely investing in schemes such as LES, job clubs and the other successful schemes. Does she believe there is a role for JobPath, Turas Nua and Seetec into the future?
There is major concern over the type of model with the tweaking the Minister is proposing. If she puts this out to open procurement, what are her intentions? The fear is that she is moving from the not-for-profit community model that works to a more privatised model. The concern in the LES and job clubs is that she is moving to a privatised payment-by-results model and away from the community. Is that the intention? The concern is that the payment-by-results model does not work. The model that works is the not-for-profit LES based in community with the wraparound services that are provided in terms of upskilling, further education and all the other things that are not taken into account when their achievements are considered. I would appreciate answers to those questions. I hope I will have another chance because I have many more.
Like the Deputy, I would be concerned about the prospect of tendering for labour activation services. Even if the Minister and her officials were minded over a period of time to go down that route, my advice would be to reflect on it. The review of the operation of JobPath might inform the Department's approach to that. Like Deputy Brady and others, I am not convinced of the requirement to go through a public tendering process to obtain these services. If I cannot get copies of the Minister's legal advice on this, I would like her to elucidate more on the nature of that advice.
Yesterday we had a very interesting debate in the Seanad on a Bill introduced by Senator Higgins. It is very timely legislation designed to ensure our public procurement system places greater emphasis on social, environmental and labour responsibilities. It is important to reflect on these issues when tendering, particularly for something as significant as this. If the Minister decides to tender for these kinds of services, the tenders should be designed very carefully so as not to exclude accidentally or otherwise organisations that are well equipped and well experienced in terms of providing these very important services. We know that tenders are often designed to obtain the result the system may want. I ask the Minister to elaborate on the timeline envisaged for tendering for activation services of this nature as that would focus our minds on the horizon ahead.
More than adequate information is available from the Indecon report to justify the sustainment of the LES and job club model into the future, particularly when we remember the considerable number of households with no working adult. It concerns me and I know it concerns the Minister. It concerns anybody with any interest in the idea and value of work in our society. It seems very clear that the LES and job club model is best placed to deliver the kinds of customised and tailored services that those who are very distant from the labour market require.
The payment-by-results model, which seems to be entirely driven by the profit motive, is not well positioned to provide the kinds of wraparound and customised services that LES and the job clubs are renowned for providing. LES and job clubs provide something that money cannot buy - the institutional memory and expertise built up over many years. The Indecon report shows clearly that the LES operations across the country have very strong relationships with local employers. Employers interviewed as part of this process demonstrated that their experience with the local employment service and job clubs was very important and very useful in identifying employees for their organisations. That in itself is a very convincing argument for allowing the LES model to continue.
It is crucial to continue to have a community-based response with all the kinds of things that LES and job clubs do to reach those people who are of concern to me and to the Minister - those who are very distant from the labour market and those who for a variety of socioeconomic reasons often experience intergenerational unemployment. In our day-to-day work in our communities we come across many people who are victims of those unfortunate circumstances.
I ask the Minister to reflect on my comments on public tendering and the legal position. Even if she and her officials are minded to enter into a public procurement process to obtain labour activation services of this nature, I ask her to wait until she has the JobPath review in her hand because it should inform our approach to future labour activation services.
I will make some comments while the Senator might to look at the opening statement.
I have often referred to the issues and challenges facing the long-term unemployed. There have been many reports on what we have done in the past. We have statistics for the numbers of people unemployed, the percentages who got jobs, the costs associated and so forth. It is very quantitative, but the quality of jobs and the aspirations of people are rarely mentioned in the reports. We spend a lot of time just looking at the raw numbers.
I do not pass criticism on what we have done in recent years.
However, the challenge we are facing for the next few years is a different ballgame. What we did that worked in the past will not be fit for purpose. We need more. The group of people we are examining now are long-term unemployed. In many cases they come from geographical areas which would be referred to as black spots of high unemployment. The areas have had that tag for a long time. Then there is the intergenerational issue in families. The issue we are looking at is somewhat different. We are also in a situation where, significantly, employers have positions they are unable to fill. Our programme for the future must be more than presenting an individual to fill a vacancy because the capacity of the individual to fill that vacancy must be examined.
My first observation is that whatever new programme emerges must be more holistic and must deal with the challenge of the preparation of the person. I know many people in their mid-20s who have never worked. They might not have even done transition year and they are out of school for ten or 12 years. They are not work ready. In other words, one could present them with an opportunity but they do not have the experience and they are out of education. There are many more challenges for such people and the new programme must reflect that. It must go further than just focus on employment. I accept that the Minister's responsibility is employment affairs and social protection. This issue must be addressed in a whole-of-Government way. That includes education and the role of DEIS schools. The Minister has a role to play as she refers to it often with regard to school meals and so forth. It must be well co-ordinated. We still have a situation where the outcomes for children attending DEIS schools are not equal to those of children attending non-DEIS schools.
There is an array of challenges and they must be dealt with holistically. While getting a person a job is one goal, the goals have to be more than that and include the quality of job and the community the person comes from. This is not just about addressing the needs of an individual. It is not just the individual but the family the individual belongs to and the communities the individuals comes from. It is a much more difficult task than what we have faced over the last number of years.
I have a specific comment on one of the recommendations, which states, "Reflecting the decline in the number of individuals who are experiencing long-term unemployment and given the role of other measures including JobPath in assisting this group, we recommend that Local Employment Services should in the future focus on the most disadvantaged activation and other client groups who are not currently obtaining assistance from other State-delivered/funded programmes." I would be careful with the last part. Even if somebody is in a programme at present it might not be the appropriate one. We must be careful when setting up a new activation to deal with the long-term unemployed. If somebody is already in a programme, that programme is an opportunity that exists today but it might not be the best fit for the person's needs. That person should not be automatically excluded. I give that caution as we design the new programme.
Those are my opening observations. I call Senator Higgins.
I apologise for arriving late to the meeting but I had to attend a debate in the Seanad. There is much that is very positive in the Indecon report and there is a detailed breakdown of what we already know from the different testimonies to the committee. I wish to focus on the benefits of the LES. I might mention JobPath but I will focus on the schemes we are reviewing.
The Minister will be aware that yesterday, I brought a public procurement Bill through Second Stage in the Seanad. It has a long journey ahead. What started my interest in that area was JobPath being proposed. I recall being told at the time by somebody from the Department - I was a civil society representative at the time - that we had to do it because of European directives. I looked at those directives, where they were coming from, how they were changing and saw that there was huge scope within them. While much of the analysis of the report is strong and robust, what emerged, and it emerged strongly in our hearings earlier this week, was that the recommendation that competitive open procurement should be considered felt like a non sequitur. The case was not made for it. In terms of the services of general interest, there is scope for the model of delivery we have at present to continue or to be enhanced. We do not necessarily need to move to an open procurement model. It is important that the Minister and the Department allow this model to be developed further. The ultimate test should be around the outcomes, and they should be monitored, but the competitive process has not always delivered the best outcomes for us.
Certainly, some of the very blunt measures, such as the 30% target, do not capture some of the positive work that has been done. We know the LES have hit 28.8%. They are almost hitting the 30%. What struck me was that in both job clubs and the local employment services, that was the measure for over 30 hours. However, a huge number of people were also moving into perhaps less than 30 hours work. That was an important step for them in terms of their progression and building labour market attachment. It may have been persons who were also balancing caring and they were considering the 15 hours childcare. The way we measure it at present does not capture those who may only be working 20 hours or 15 hours, but that is an important step back into the market for them.
Another matter that strongly emerged from what we heard from the local employment services is the recognition that there are multiple other positive outcomes. Jobs are one outcome. I am aware that the Minister understands this issue because we have discussed it in the past. A return to education is also a positive outcome. That is not something for JobPath in its contract. The local employment services have made strong connections with universities and while it might not hit the 30% target that is a very important outcome. That texture of outcome and the responsiveness that local employment services have shown to a changing landscape are great strengths. When services are not for profit, they are able to be more responsive than services that have not only the Department to engage with as their client but also shareholders with projected income and returns. They do not have that flexibility.
The number of long-term unemployed has decreased, but there are other cohorts. There are people who may not be on the live register and people who may be parenting alone. They might have young children but may want to access services on a voluntary basis. I was struck, for example, that those who would probably be qualified adults in the system had found support from local employment services. That might be jobless households where somebody might not be on the register but who was able to engage and get supports in that regard. It is similar for people with disabilities and particular programmes in that respect. There is huge scope. Again, it is very important that this wider scope of potential interest in people who may have a slightly longer route to employment and may need particular supports is in a positive frame and not in a punitive or sanction-based frame. Local employment services can do that.
I called into the climate change committee meeting just as it went into public session and was voting. It was an interesting experience. One of the main issues debated was support in just transition for those in carbon-intensive industries as those change. People wanted to know that it was not simply going to be a JobPath model but a joined-up model. Again, the local employment services and the job clubs are exactly the type of measure and space for transitioning. They have said that they have had the scope in the past and could have it in the future for working with those who are not unemployed yet, who may be in precarious work or who may be in sectors that are down-scaling. That is a huge potential. I will not go into all the evidence of how they work. I am talking about the potential for the future. As the Chairman said, we face a new set of challenges. The local employment services and the job clubs are the appropriate tool for the complexity of what we face. We are in danger of losing some of that if we move to an open competitive model that is frozen in time when we sign up to a five-year contract and have a certain number of people attached. That flexibility in response could be lost. I believe we should scale these up.
My last point is on something that is very good about the model at present. I worked with Wexford Local Development and young rural unemployed people in the past. What was wonderful was that we listened collectively to those young people on how they felt the system could work better and what a rural Youth Guarantee might look like.
There was an openness, a social benefit and a conversation, which is different from feeling like an axe is hanging over one's head due to the number of CVs one has sent. People were feeding back and the system was responding. This is basically a paean to local employment services and job clubs, but they are what we need for the future. I hope that the Minister will tell us how this will translate into a scaling up and that she will address education links specifically.
I will try to address the issues in the round and then answer the specific questions. If I have missed any in my notes, the members might shout.
It is obvious that we all appreciate the services that have been provided by the LES and job clubs to hundreds of thousands of people down the years. We are appreciative of the services they have helped us to deliver. We have no intention of downsizing or changing negatively anything that they do.
To synopsise what I am hearing from members, they are happy in the knowledge that this forms part of the service offering that we will need. We value the experience, expertise and tailoring of services, which Senator Higgins eloquently described. We want to take advantage of that in future. The Chairman hit the nail on the head. When we develop the next generation of services, we must do so cognisant of the fact that the challenges facing some people now were not even around ten or 15 years ago.
There will be an array of services, but they will not be in competition with one another. We do not sit down and say that JobPath is better than the community employment, CE, scheme. It is not. It is just different. We must model services so that no two organisations, be they contractors for the State, our own people, host companies or so on, are doing the same job. We must recognise the skills, talents and capabilities of each organisation and send sections of society that are facing different challenges to those organisations that are most receptive to helping them get through them. That might mean CE during one period in an unemployed person's life before he or she moves to being CV ready. Someone may move from one service to another over the lifetime of his or her unemployment. I hope that the lifespan of his or her unemployment gets smaller and smaller.
We are aware of the changing factors and social difficulties that the people of this generation face. We must tailor and model our services going forward.
Last week, Deputy Brady gave me the opportunity to reiterate the fact that the budgets for our contracted services had not changed. Our intention is to model the next activation services that the State offers in a tailored way using the people, experience and expertise currently in place. The LES and our job clubs will form an integral part of that offering. I am as grateful for them as are most of the members present. I met them before Christmas and intermittently since January. I have told them that we could not have done what we did in recent years without them. By the same token, we could not have done what we did in the past five years without Turas Nua, Seetec, CE, Tús, RSS or SOLAS in terms of training or the back-to-education grants from the Department of Education and Skills that allowed people to return to full-time third level education.
No two people who are looking for work have the same set of challenges in their lives. Therefore, the services that we offer on behalf of the State must be wide and varied, and their next generation must be tailored and capable of being scaled up if, God forbids, something happens.
The Chairman is right about this being outside the generational services offering on which we are working. When I was before the committee last week, I suggested that we consider establishing an interdepartmental body to examine the daily and weekly challenges facing people from zero to 66 years of age and tailor a cross-departmental targeted approach to geographical black spots. We cannot tailor five services from the perspectives of activation, education and experience and capture all of the challenges of the families in question. More is needed. Once that is done, it should be a priority in where we move next.
Yes. If I am here for long enough, I would have no problem doing so, but if we get this body of work done in the next couple of months, we need to consider putting a cross-departmental task force together immediately afterwards, or perhaps even in tandem, to examine specific geographical areas. There could be a proof-of-concept pilot. If it can get better outcomes for 1,000 people within 12 months, it might be a model with which we can move forward. I am willing to do that. The national action plan for inclusion is being launched in May. If we can work between now and then on developing a pilot, that would be a great time to launch it.
The Chairman mentioned a new range of programmes, but they are not new. We have a range of services offered by a range of contractors. Some of them are fabulous but some could be better, given their skill sets and the need to reach people whom we have never reached before. We need to enhance and empower services. We are not getting rid of youth employment services, over 55s services, CE, Tús or RSS, but tweaks can be made to address specific challenges and enhance our offering. That is what I hope to do with the Department in the coming months.
Senator Higgins discussed how we measured outcomes. The same metric that is used for her is not used for Senator Nash or Deputy Brady. The outcome is the provision of a pathway back to work and sustainable, happy and fulfilling lives for those we service. The Senator is right about there being some people on the live register who need a more holistic wraparound service to help them get from where they are to where we want them to go. For some, that might take three years. For others, it might take seven years. It can only be determined by each person's willingness to work and co-operate with the services, assuming those services are tailored to that person's set of needs. Measuring outcomes in CE will not be the same as it is in Tús, JobPath, LES or job clubs. Outcomes are measured in the fulfilment of the person's needs. For some, that might just involve learning the capacity to understand that they need to show up at the same place ready for work every day. A service might need to train someone to develop learning skills, teach people a different language and so on. Some people will have a specific set of requirements on day 1. By year 2, they might have a different set of requirements. Different factors and outcomes for different levels of service are required to get people from where they are, which is long-term unemployment, into long-term, sustainable and supported employment. That range of services will be designed in the coming months. We will also tweak existing services to ensure that we fill every gap.
Thankfully, the live register figures are reducing, with numbers on the long-term live register decreasing at an even greater speed. More importantly, they are doing so faster than in our European counterparts. Given the current capacity in our system, this allows us to reach people who are intergenerationally unemployed and to address their issues. It also allows us to reach people who are not on the live register but who want to work and just need access to the range of supports and educational opportunities. It allows us to stretch our offering to reach a much wider audience. This is not just about apple pie and love. We are reaching the stage of not having enough people to fill the job vacancies being created by the economy, so it is in the country's interests to encourage people who are not working but who are not on the live register to participate in the economy. We must provide whatever services we can to ensure that it is an easy and supported journey for them.
The most serious message that I should get across today is that our services are not in competition with one another. That one has an outturn rate of 28% versus another's 25% or 9% or CE's 37% does not mean it is a competition. Each person attending a body for assistance has different needs. If the metric was the number of people who got a job within one year, some organisations would be excelling and others would not, but that would not take into consideration any of the challenges facing the people we have sent to those organisations. This is not about competition. It is about having an array of services that suit individuals' needs at a particular time in their lives. As long as I can offer a full range of services that complement one another, that provide someone attending an Intreo office a choice depending on his or her social challenges, difficulties or barriers to employment, and that find that person a niche and allow him or her to progress to other services or into work directly, getting that right will be a measure of success.
I think that will be a measure of success, if we can get that right. It will not be easy because, as I said, the people who are presenting have a variety of different issues but it is our job to provide services at the best level we can.
The biggest message I am hearing today is that the committee's concern and nervousness is over public procurement, so I will be very honest and brutal. EU procurement rules apply to everybody except those services to which they do not apply. The legislation, as advised to me by both the Chief State Solicitor's Office and Attorney General, is to the effect that, much and all as they and the committee would want it to be otherwise, the Irish Local Development Network, ILDN, local employment services, LES, and our job clubs do not come under that derogation. They have to be attributable to the EU procurement laws, as does everybody else in the country.
That is not something to be afraid and fearful of. If that is the only thing the committee is concerned about, even though it is not necessarily a message that we are getting from interactions with people from LES, and job clubs, then it genuinely has nothing to be concerned about. Our job is to provide for the 77,000 people who are long-term unemployed, the 45,000 people who are on community employment schemes and want to progress into sustainable employment and those hundreds of thousands of other people who are not on the live register but potentially could be in employment if the proper services were available. There is much work to be done at a tailored and detailed level. People are facing different challenges today, and will do in the future, so we cannot offer the services that we intend to offer to the far too many people who are unemployed without the procurement of LES and job clubs. We must ensure that we continue to use their expertise and employment skills in the future. We must tailor our plans and models. They will not be the same because some people will be looking for a certain type of service and others will be looking for a different type of service but there will be a place for all our service providers in the future.
Deputy Brady asked specifically whether I intend to contract JobPath in the future. What I currently intend to do is to fulfil the contract we have, which runs until 2021, and what we decide for the future is totally dependent on the outcome of deliberations we will have with each other over the coming weeks as to what kinds of services we need to offer. I ask the committee to ponder the fact that the 48,000 people who got work in the past number of years because of JobPath did so because of that particular model. I do not know how many of them would have got jobs without that help but I am sure we did not have the capacity to look after those people within the system, through our own offices and those of our service providers, before 2015. We were incredibly stretched which is why we introduced the new Intreo model and contracting services on a pay-for-performance model because it works as part of a mix of services. That is international best practice. That is not the only service, nor will it ever be.
There are 48,00 people currently going through JobPath to whom we have a responsibility. We will fulfil the contract with JobPath before we make decisions, in the next couple of weeks, as to what the next generation of services will look like.
Senator Nash asked if I could give him a timeline, if we are wedded to tendering, but and I cannot do that. We are currently in breach of the EU legislation and have been for the past number of years. I am not rushing to confirm a tender next Tuesday. We need to know for what we are tendering. I cannot do that specifically until we know exactly what kind of services we want, and the range of them. We will work in co-operation with LES over the next couple of months to find out what extra capacity and skillset they have that we have not heretofore been utilising. Senator Higgins alluded to some of that.
We will decide in the next couple of months on the best level of service offerings for training, employment and activation services we need to give to the next generation of unemployed Irish people. We will then work with the services we have to allow those people consider which ones they want to work with and fulfil. It will not take years but it will not take weeks away either. We need to ensure we get it right for the next generation, rather than for the next couple of years, and that the services we offer are based on the experiences we have today. There is a reduced number of people on the live register but we have extra capacity within the current system to extend the services we currently offer and, indeed, future services we offer to people who heretofore we have not offered services.
I will return to the procurement question. There is a case to be made for alternatives but I accept this is the route the Minister is looking at. The social inclusion and community activation programme, SICAP, was restricted to not-for-profit and other similar services. Is that a capacity within the tendering process? I am serious when I say that there are spaces for human services where not-for-profits are better able to be responsive.
I welcome that the Minister has referred to choice being offered to the person who is being assisted. What weighting would be given to quality if this procurement process is pursued? Quality of training of staff had a low weighting in the JobPath process. It is vital that a high weighting is given to quality and different quality measures. That is different from the paper performance which is about the outcome.
Quality and responsiveness are important. The scaling moved up quickly with JobPath.
There would be space and freedom from the European procurement directives if tendering was not pursued and Intreo's internal capacity was looked at instead. Is there potential for, or are there plans for, increasing Intreo's staffing levels and perhaps, in some of the ongoing work, increasing the internal and ongoing capacity of the services to support Irish citizens?
We talked about groups of people who are hard to reach, perhaps those who are precluded from payments because of an habitual residency condition. They may be addressed under a consideration of voluntary access.
SICAP was an open competition tendering process which adheres to the EU procurement rules. There are lessons we can learn from how that tendering process was done before we go out to our own tendering process.
It is all about outcomes and it has to be across every single scheme because, ultimately, the aim is to get somebody into long-term, sustainable, supported employment but it is not a race. Different services will have different speeds, for want of a better word, depending on the support they are offering, the types of services they are offering and the people they are serving. It might take one service a year to help somebody get a job and it might take another service three years. Somebody might need to go from one service to another service for five years in total before they get employment. It is not about how quickly we get somebody to the outcome. It is about providing a service that is tailored for that particular person's needs and supporting them through that journey back into full-time, sustainable employment, no matter how long it takes. That must be the aim and it must be acknowledged that one type of service does not fit everybody's requirements. That is why we need a broad spectrum of services provided by a range of people.
We will not increase our Intreo offices. The live register numbers are coming down and the premise from the Department of Public Expenditure and Reform is that we should be reducing our overall staff count, not increasing it. We have enough capacity in the system currently and we do not need to employ any more. Between LES, job clubs, Intreo case officers and the case officers in JobPath, we have just under 800 individual case office managers which is sufficient, on the ratio of 120:1, which is international best practice, to get the best outcomes.
It will depend on the service that is being contracted for. We will design the tender based on the service that is required. If that service requires a higher wraparound, it will not be the same kind of tender as it would be for service we want to help a person get work experience or training.
There has to be an acknowledgement that different people are going to be travelling at different speeds. Supports have to be there to enable them to feel supported and empowered all the way through the journey, no matter how long it takes.
I have a number of queries. I will follow up on some points made by Senator Alice-Mary Higgins on procurement. She is correct regarding SICAP tendering. It was approved by the Attorney General and I am told it was restricted to non-profit companies. The Minister stated there are lessons she may take from the process. I would like to know what she thinks those lessons are. The process did achieve what it set out to do. It was an open tendering process but who could tender was restricted. The Minister is stating nobody should be afraid of the tendering process. Nobody is afraid of the process, but the question is on what grounds the tendering process is based.
If it is based on payment by results and open to for-profit companies then that is something of which to be fearful. These private companies are more concerned about their shareholders and meeting their demands than the individuals they are supposed to be looking after. There is certainly something to be fearful of regarding the tendering process and how it is going to be put in place. I am not convinced we are bound to use that process by EU guidelines. Will the Minister circulate the advice she has been given to the committee? The information I have completely contradicts the Minister's. I am not going to get into an argument with the Minister on this and we may have to agree to disagree-----
There is competition and we have evidence on that from people within the LES as well as people in other services such as adult guidance. People who had been engaging with those schemes and were then referred to JobPath ultimately ended up back at their starting point a year later. They were taken out of training and education schemes that were working and put sitting in front of a computer screen for a year only to then find themselves back in the LES. We know there are difficulties in CE schemes. I cited those already in my opening comments, including the number of vacancies. The Minister stated there are 800 staff attached to all of these services, including JobPath. She did not go into much detail, however. She did state that when JobPath was rolled out in 2015 it was not possible to scale up the existing services such as the LES and similar schemes.
Now is the time to start scaling up those schemes because there is a distinct difference in the staff. I am not going slate any employees in Turas Nua, Seetec or anywhere else. There are all doing a job. The level of training of staff in the LES and job clubs is second to none, however. There is a high turnover of staff in Turas Nua and Seetec and that seriously impacts on delivery for people on those schemes. There is an opportunity to upscale the LES, jobs clubs and other services now. We all agree that things have to change and now is the time to start looking at scaling up the 23 LESs and the job clubs. We all agree those are working. I am not convinced how beneficial it is for people to engage with Turas Nua and Seetec. We could argue all afternoon about how successful those initiatives are. The vast majority of people, however, who have got jobs would have got jobs one way or another. There are many people who-----
-----further away from the workforce now because they have been sitting in front of a computer screen for three years. Those people will probably find themselves linked in again with the LES. The Minister did not answer my question on the future of JobPath.
The Minister stated the programme would be examined in 2021. The contract itself is up this year with a two-year run-off period. The Minister stated that she wants to see the 48,000 people engaged on the programme complete it and she will not make any decisions on the future of JobPath until 2021.
I apologise but I have just one more question before the Minister responds. Returning to the issue of procurement, if the Minister does push ahead with open tendering will the €20 million condition that was part of JobPath be part of this tendering process? I have serious concerns if that is what is intended.
I will start with SICAP. It was an open competition with public tender. When I mentioned lessons could be learned from it, I meant in the structure of the tender, the lot size and the awarding criteria. It was an interesting process and we have learned from that. We will take cognisance of those lessons when we are doing our own tendering process. The only advice I get as a Cabinet Minister is from the CSSO and the Attorney General. I am bound by that advice and I have been told there are no derogations regarding public procurement in EU legislation regarding my ambition for publicly tendering for service offerings. I accept that advice. As is normal, I will certainly not be issuing copies of advice intended for me and the Cabinet. I am bound by that advice but I agree with the reasons underpinning it and the model itself.
I state again to Deputy Brady that there is no need to be fearful. Regarding services we need to offer in future, there are more than enough people for the service offering we have today. I refer to the 77,000 people long-term unemployed, the 42,000 people on CE schemes and anybody else who wants to work and who is not on the live register. That is before we even tweak the system. There are enough people to continue using the contractors we have into the future. Our ambition is to tailor and tweak the services we are currently offering to suit the requirements and needs of people not being fulfilled in every way they could be today. We also need to recognise that the challenges unemployed people face in the future will be slightly different.
For about a year after I became Minister the case was often made to me that the sole reason for the decrease in CE applications was JobPath. We changed the legislation last June to allow anybody on JobPath to be part of a CE scheme, if that is what the person wanted to do. We still have, however, a large number of vacancies on our CE schemes despite there being no restrictions preventing anybody on JobPath applying for and participating in a CE scheme. I can only conclude that the tens of thousands of people I was told were on JobPath who apparently wanted to do CE schemes have either gotten jobs, as part of the roughly 47,000 people now in work again, or are happy to continue with JobPath. Applications have not been made in the kind of numbers Deputy Brady and his colleagues presented to me previously.
We do have an issue at the moment with CE placement. It is not as simple, as Deputy Brady seems to think it is, as having thousands of people on the live register and thousands of vacancies in CE schemes. We cannot just make people go onto CE schemes. That is not the way we work. People have to apply for CE jobs and they can only do that if that is what they want to do. We are certainly not in the business of making people apply for work experience if that is not what they want to do. We are in the business of recognising that no one-size service is going to fit everybody's needs.
Over the coming weeks and months, we will develop and design a range of services that will be sufficient to provide a level of service support, activation, encouragement, mentoring, training and everything else that is required to help people who are out of work in the short, medium or long-term. This will ensure they have a State service they will fit into nicely and be able to work with at the various stages of unemployment to get them back into long-term, sustainable and supported employment.
Deputy Brady stated that we had removed people from educational courses and training schemes and placed them on JobPath. That is categorically not true. People in training, on an educational scheme or doing a course in college do not appear on the live register. The only people we send to JobPath are those who have been on the live register and have been under-employed or unemployed for more than 12 months.
The Deputy commented that we should beef up the numbers being sent to LES and JobPath. The outcomes, expertise and excellent service we achieve are possible because the ratio of clients to case management teams in the local employment services and job clubs is below the best practice maximum. According to international best practice, the ratio should be not more than 120 clients to one service case officer. At the moment, the ratio is probably around 100 in all of our contracted services, including Intreo. We have the capacity to scale up the number by about 20. I have no doubt that when we start offering services to people with a disability who are not on the live register and those in jobless households who are registered as qualified adults as opposed to being on the live register, we will have more than enough people to increase the average ratio from 100:1 to 120:1. If the Deputy is suggesting I should overload the local employment schemes by raising the ratio to 200:1, they would be overwhelmed and unable to offer the level of service they have been able to offer in recent years. We have a capacity of 800 case managers and we need each and every one of them. We have no intention of diminishing the services, particularly at a stage in the country's cycle when we are about to try to expand the range of people to whom we offer those services.
On open tenders, compliance with EU regulations and so forth, I respect the fact the Minister has received advice from the Attorney General. I also understand, as will anybody who has sat on the Government benches, that the Attorney General's advice may not be shared. The Minister hit on a point that is very accurate and true, which does not only apply in the areas in which she is involved but applies everywhere. The very nature and type of tender that one seeks influences the outcomes. As she designs the process, I hope the Minister will be in a position to keep the committee informed of her thinking and progress on the matter. The open tender is not the issue. It is how the tender is structured that will determine the outcome. I ask that this committee have some input, oversight and view of that process as it develops. That would be useful.
On the procurement process, the Minister did not answer a couple of my questions on the €20 million condition that was used for JobPath. I appreciate she may not have started consideration of the tender but there are serious concerns about the matter. I also questioned the Minister using the payment-by-result model. On the EU guidelines, I acknowledge the Minister's point that she cannot share the information given by the Attorney General. The Attorney General gave the go-ahead for the SICAP tenders. The EU guidelines, which I quoted earlier, provide that services of general interest expressly include services provided directly to the person such as social assistance services, employment and training services. These services are specifically mentioned in the list of services of general interest. I firmly believe we can address this without having to place the services out to tender. I am not going to give up on the matter.
There was a specific reason that sum was in that tendering process. The Deputy asked me whether it will form part of all tender processes in the future. I cannot say whether it will form part of all tender process in the future but I cannot rule out that it will form part of some of them. The payment-by-result model, which is the one the Deputy fears most-----
The Deputy wants me to answer whether we have designed and have specific recommendations or conditions in a tender when we do not know what we are tendering for. I will answer his specific question on the payment-by-result model. The model has its own merits but it is only one model. Based on the range of people we need to serve, we need many models. I do not know how many times I have to say this before the Deputy will acknowledge our bona fides in what we are trying to do. I am not trying to send everybody to JobPath. There are some people the service does not suit. There are some whom we have not even reached yet and it will not be beneficial to send them to JobPath until we send them to other levels of supports and services. If the Deputy fears that all services will be disbanded in the morning leaving JobPath as the only remaining service, he has nothing to worry about. JobPath is a very successful model but it is only one of the models we use. We have extremely successful other services that we continue to work with, which are full of experience, expertise, advice and empathy. There are many different models that are working exceptionally well. We need to tweak some of them for this generation, enhance others and move to multi-annual contracts to ensure people do not worry about whether they will get their money next year or the year after that. What we are trying to do is improve the range of models and services that we are offering, not undermine, threaten or give anybody the willies. We are trying to improve the level of services offered by the State, while recognising the complete level of requirement and changing requirements the people we serve have today. That is all we are trying to do. There is nothing to be scared of.
I concur with the Chairman's request that the committee have an input in the process because it is very important that we do so. We have already made a case in respect of services of general interest. One of the issues was outcomes, specifically educational outcomes. The Minister outlined how it may take people five or six years to move through a service. Let us say there is a two-year or three-year contract. Is the Minister considering what the outcomes will be? If somebody moves through a local employment service and then starts a three-year degree, that will not translate into employment within the period of a particular contract. However, it must be recognised as an outcome. That is what I was saying about the measurement of outcomes. There is a long-term goal but, as the Minister has acknowledged, sometimes people are very distant or have an ambition to travel a great distance.
We must recognise any movement out of the remit of the Department and into long-term education, a primary degree or whatever. This should be recognised and it would be very useful for the committee to have an input.
Just transition and multi-annual contracts are very important but they must be flexible and able to respond, for example, to the collapse of an industry caused by Brexit, climate change or whatever. Does the Minister know what I mean? New contracts will be needed. There have been sectoral crises and in some areas large numbers of persons may be in danger of becoming unemployed. I emphasise the point I raised earlier about people who are at risk of becoming unemployed, whether as a result of Brexit or climate change.
We have enough to do providing services to unemployed people without providing services to people in pre-unemployment. We need to empower people who are in precarious or vulnerable situations with stronger legislation, as we have done with the enactment of the Employment (Miscellaneous Provisions) Act, which commenced in March.
I would be open to introducing more strenuous legislation to support people's employment rights in the jobs they have, as opposed to trying to help them to get their next jobs from the jobs they are already in.
People who are not registered anywhere, other than as independent qualified adults, potentially have a valuable contribution to make in the social economy or the real economy but have never been offered supports. We often hear from women that they have never been asked. Most of them are already working in the social economy, for example, in volunteering agencies in towns and villages.
The Senator is touching on a model with regard to the local employment service and outcomes. We do not currently model the service on outcomes, but I think we should. When I refer to outcomes, I do not mean that there should be a target of getting jobs for a certain number of people. I envisage that the wraparound services on offer from our local employment services in the future will be far more holistic about getting people on the road to recovery, as opposed to getting them a job. Outcomes can and should be measured in a variety of ways. That is something we can potentially look at in the very near future. At the moment, we do not really do outcomes with our local employment services or community employment schemes. We do not intend to put people under pressure by giving them outcome targets. We want to make sure we can see people moving and progressing through a range of services that are on offer. Maybe they will move from education into employment, or from upskilling and confidence-building into education. We want to see a progression over the range of services. I would be very keen to move to an outcome level without putting any fear factor in that.
It should not be a performance outcome because what might be a successful outcome for me might be a different measure or metric of a successful outcome for someone else. We need to be cognisant of all of those metrics.
I thank the Minister. That brings our proceedings more or less to a conclusion. My final question for the Minister relates to the insight this committee might have into the policy formation that will underpin the tendering process. What might be possible in that regard? I do not expect the Minister to answer that question now. Her officials might send us a note on it. I understand that tendering is a legal process. Issues have been raised about the type of tender, how it is structured and the criteria used. The Minister knows what I am trying to get at.
Such issues have an effect on who can apply for a tender, who would suit it and the types of company or organisation that may or may not apply. The Minister might send us a note on what might be possible, from her point of view and that of the Department, as a means of keeping this committee informed on the progress that is being made in this regard.