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NAO conclusions are premature says ERSA ….







23 January 2012

Welfare to work providers respond to National Audit Office report on Work Programme procurement

The Employment Related Services Association (ERSA), the trade association for the welfare to work industry, today comments on the findings of the National Audit Office (NAO) report into the procurement of the Work Programme (released 24 January 2012).    ERSA welcomes the focus of the National Audit Office on referral numbers and type.  However, it believes that the NAO’s conclusions in relation to likely performance levels are premature. 

In particular, ERSA highlights the following points in response to the report.

  • The rapid procurement and implementation timetable of the Work Programme was met by the welfare to work industry, with a great deal achieved over a short time.   Undoubtedly, the process of transition from previous welfare to work programmes to the Work Programme was difficult for many providers, with largescale TUPE transfers taking place across the sector.  This has necessitated industry-wide collaboration, which has been to the benefit of customers.
  • ERSA does not recognise the performance levels anticipated by the National Audit Office.  These appear to be speculative and not based on performance information.   ERSA believes that it is too early to draw any conclusions on likely performance levels across the life of the contracts.  Providers are working hard to achieve the best possible performance levels for all customers and early indications of job entry levels are in line with expectations.
  • Clearly, however, the economic backdrop has worsened since providers submitted tenders in spring 2011.  In particular, regional variations in economic outlook may have an impact on performance levels over the next two to three years.  ERSA will therefore track the UK’s economic performance very carefully and is ready to help facilitate dialogue with the Department for Work and Pensions if this were to become necessary.   ERSA does not believe that this is the case at present.
  • ERSA welcomes the recognition by the National Audit Office of the problems faced by the industry of the lower than expected level of customers on Employment and Support Allowance (ESA).  ERSA believes that this is currently the number one problem that the government needs to solve.  Low level of ESA referrals have disproportionate affects on voluntary and community sector providers, as this sector disproportionately provides the specialist support many of these customers need.


  • ERSA regrets any suggestion that providers will act unethically in the delivery of services.  ERSA members are asked to sign up to a code of conduct, while all providers are subject to the Merlin standards of responsible supply chain management.  In addition, the sector is introducing its own set of qualifications and is setting up a dedicated professional institute to ensure the very highest quality standards across the entirety of the industry.

Speaking in response to the NAO report, ERSA chief executive, Kirsty McHugh said:

‘The welfare to work industry welcomed the ambition of the Work Programme, believing that its design and scale will help to facilitate high quality support to jobseekers.   Providers have achieved a great deal in implementing the programme over a short period of time.    We welcome the focus by the NAO on the need to increase the number of ESA referrals to the Work Programme, but do not recognise the performance figures in the report. 

‘Clearly, however, the worsening economic backdrop must be taken into account and therefore the industry will require a strong partnership with the Department for Work and Pensions to ensure that the Work Programme delivers for the benefit of all customers. ‘


Notes to Editors


ERSA is the trade association for the welfare to work industry. Established in 2005, by the industry for the industy, it exists to help members achieve their shared goal – to help people achieve sustainable work.  ERSA’s membership ranges from large multinational corporations to small specialist charities. It represents over 90 percent of those organisations that have been awarded prime contracts for the Work Programme. Approximately half its members are third sector organisations.

Press enquiries should be directed to Philip Curry at philip.curry@ersa.org.uk or 07919622053.


  1. We, Renaisi, are a social enterprise and subcontract to three of the Primes and are not a member of ERSA, but just as a point of clarification, ERSA membership is listed on their website. You need to bear in mind that the somewhat free-for-all bidding process to become a prime, it has resulted in some Primes actually subcontracting to other primes in one CPA and vice versa in other CPAs so enevitably there are a mixture of Primes and subcontracting Primes in ERSA. Outside of these however I would imagine there will be less representation from smaller organisations not least because of the relatively high membership fees that ERSA charge!

    Sadly we were not canvassed for our views by the NAO!

  2. The NAO report is spot on. Why is ERSA trying to defend the WP, maybe because it represents Primes . How many non -prime contractors are members of ERSA? . We all knew that the Work Programme as designed was not viable . We also knew that the failure to pilot the programme and keep some of the targetted provision was a grave error , with swaves of unemployed being left to their own devices as specific support for young people, lone parents etc were culled , leading to the current deplorable situation. It is simply impossible for the Work Programme to cater for all categories of unemployed people. The funding mechanism is the greatest barrier as it is unrealistic and simply impossible. It would be useful to find out how many subcontractors ( specialist providers ) have received referrals and if so how many?

    • So ERSA don’t recognise the performance levels suggested, but at the same time indicate that the state of the economic situation will have an impact. Where do they get their “early indications” from? I thought providers weren’t allowed to tell anyone, under pain of contracts being withdrawn, about their job entries. Are ERSA really saying over 40% of starts have gone into work and are still there? Let’s say to achieve 40% sustained you need to get 60% into work. Come on! In this climate? NAO may be speculating but it will be an educated speculation!

      And they don’t think anyone has acted unethically so far? How many primes passed on the same payment by results model that DWP gave them? How many abided by the Merlin standard of not placing undue risk on subcontractors? How many changed the offer after they were awarded the contract? And their have the audacity to mention TUPE after that complete farse?!!

      Who do ERSA actually represent? When will organisations such as ERSA and CESI stop sucking up to politicians and be honest with themselves and their members.

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