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Report warns Government aim to achieve an employment rate of 80% likely to be very challenging.

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• Public Accounts Committee

Government seems complacent at the potential impact of a reduction in support for benefit claimants. In a new report on jobcentres, the Public Accounts Committee (PAC) has been left unconvinced by the Department for Work and Pensions’ (DWP) assurances that a shortfall of work coaches, who play a critical role working with people claiming Universal Credit, has and will continue to have a minimal impact.

There have not been enough work coaches to meet the need for support in recent years. In the first six months of 2024-25, DWP had 2,100 (10.9%) fewer coaches than it estimated it needed. To help deal with this, it allowed jobcentres to reduce support for claimants when coaches’ caseloads got too high, including shortening initial meetings with claimants to 30mins. More than half of jobcentres have said they are doing this. DWP acknowledged to the PAC that plans to redeploy 1,000 coaches in 2025-26 to provide intensive support for people with health conditions and disabilities will reduce available support further. 

The DWP told the PAC’s inquiry that it should not be concerned about the reductions in support because it has focused the reductions on the things that it thinks make the least difference to the primary outcome of getting people into work. However, the into-work rate is declining (from 9.7% in 2021-22 to 8.2% in 2023-24), and third-sector organisations raised concerns with the PAC’s inquiry about the quality and consistency of the support offered. The PAC was not convinced by the DWP’s assurances, and is seeking an evaluation of the impact of its measures to reduce support before any permanent changes are made. 

Government’s long-term ambition is to achieve an employment rate of 80%. The PAC’s report warns that this is likely to be very challenging, and DWP acknowledged to its inquiry that it is clearly a stretching aspiration. Achieving such a rate would represent a considerable increase - from May 2018 to October 2024, the employment rate fluctuated between 74.3% and 76.4%.  

To help reach its 80% ambition, the Autumn Budget in 2024 allocated £55m investment into a new jobs and careers service, bringing together jobcentres with the National Careers Service in England. The report finds that it is unclear how this £55m is being spent. The DWP did not indicate to the PAC’s inquiry how much of the £55m has so far been committed, and how much is left to be allocated. Noting that it is now several months into the financial year, the PAC’s report stresses the importance of the DWP quickly working out how to make best use of the funding, rather than making rushed decisions at the last minute. 

The report also finds that the DWP has not evaluated the effectiveness of its approach to supporting claimants into work for a decade. Tests are ongoing for services to be delivered through alternative means, by using video and other channels rather than face-to-face communication, and reducing the frequency of work coaches' engagement with claimants. In light of these changes, the PAC is calling for a published evaluation of the impact of DWP’s reforms to the employment support system.  

Chair comment

Sir Geoffrey Clifton-Brown MP, Chair of the Committee, said: 

“The support provided by work coaches in jobcentres is critical to help people find employment and progress in work. It would necessarily follow that reducing the levels or changing the nature of support provided, in particular limiting the length of initial interviews with claimants, which have to include all the verification as well as advice, would have an impact on how that service was delivered. DWP’s apparently complacent assurances to the contrary held no water with this Committee. We are seeing a continuing decline in into-work rates, and government itself accepts that its plans to provide intensive support to help disabled people and those with health conditions into work will make the work-coach shortfall even more challenging to manage. 

“DWP has not had the funding for the work coaches who are trying to provide support in the here and now, while being allocated £55m to test out new approaches. At the time of our report it was not entirely clear how this money was being spent. Government’s ambition for 80% employment is a stretching one, and this Committee is supportive of the principle of ambitious change where required for reform. But we are here to scrutinise how policy is delivered. Our report suggests the approach taken by government to achieve this radical shift and help individual claimants access the jobs market is currently in a muddle.” 

Update

The Committee’s report was agreed and issued prior to the attached Department for Work and Pensions’ correspondence, confirming that reductions in jobcentre support would be made permanent. The Committee notes that the evidence underpinning the first two of the measures in the DWP’s correspondence is around five years old, and that the third and final measure is based on anecdotal evidence. 

Following its recommendation 1, the Committee expects to see an up-to-date evaluation of the impact of more recent reductions in support.

Responding to the correspondence, Sir Geoffrey Clifton-Brown, Chair of the Public Accounts Committee, said: 

“This Committee had serious questions about the Department’s reductions to claimant support, and this letter confirming the permanence of those reductions only deepens my concerns, on behalf of claimants. They want to be able to access the world of work, and that is the main thrust of government policy. These changes would appear to fly in the face of that, and reinforce our original recommendation that we see an evaluation of the impact of reductions in support. 

“It is unclear what the cost savings of these changes may be, and the impact on the number of claimants getting into work. It is critical going forward that claimants themselves are consulted on these changes and how they will affect their future work chances.”

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