Breaking the cycle of welfare dependence is a complex task. Approaching the issue in a more scientific manner can pay dividends, the Department for Work and Pensions’ social justice director explains to Joshua Chambers
What exactly is Social Justice? It’s an oft-used phrase, beloved of politicians, policy wonks and civil servants alike. It’s also understood differently by different people – but work and pensions secretary Iain Duncan Smith, who’s made it his personal mission, defines it in his Social Justice Strategy as “supporting the most disadvantaged individuals and families”.
To help him realise that ambition, Duncan Smith appointed Mark Fisher as director of social justice at the Department for Work and Pensions (DWP) – so CSW met him to learn what he intends to do.
When Labour came to power in 1997, “they thought that the best route for individuals out of poverty is work, and we needed to reconfigure the system of welfare benefits for those of working age to focus on that,” Fisher says. The government did so by introducing tax credits and subsiding those on low wages, making work a better option for those on benefits.
The coalition also believes that work is the best way to relieve poverty, “and that’s why we’re doing things like the Universal Credit, which guarantees that people are better off in work than they are out of work; and [why] we put in place the Work Programme, to improve the way people get into work,” Fisher says. Essentially, the government wants to get rid of the ‘benefits trap’ once and for all.
The government “also recognises that a lot of people, through no fault of their own, are a long way from the labour market and it’s not going to be easy for them to get a job,” he says. Easy it won’t be, but policymakers believe it’s the right way forward. So the coalition wants to tackle the root causes of long-term welfare dependency, which are preventing people from seeking and gaining employment. These include multi-generational worklessness, mental health problems, other health problems and disabilities, debt, drug addictions, and previous involvement with the criminal justice system.
It’s difficult to set benchmarks and measure progress for achieving social justice, Fisher says. “Ultimately, we need to see more people from the most disadvantaged groups in employment. That’s the single, most powerful progress measure we can have.” But he refuses to set out a target, or even a broad figure for the number of people that DWP wants to get off benefits and into work by the end of this Parliament.
Partly, this reluctance to set targets reflects the vagaries of the labour market, he says, especially given the precarious state of the global economy. However, it’s also because the social problems that lead to welfare dependency are not well understood. Fisher is currently heading up work to investigate the underlying issues, and the DWP is working with other departments to bring together data. “It’s only recently that we really understood some of these problems: for example, how some ex-offenders ended up on benefit,” he says, explaining that only in the last year did the Ministry of Justice (MoJ) and the DWP match the data they held on reoffending and on benefits. Similarly, he is also working with the National Treatment Agency to understand how many people with histories of drug addiction are on benefits, and data-matching with the Skills Funding Agency to know how many people on benefits have low skills. “It’s only now [the data is matched that] we can really begin to look at those problems a bit more scientifically,” he says.
This data is already changing how government deals with the social problems that can lead to welfare dependency, says Fisher: under Labour, “we only had a superficial knowledge about some of the deep-seated problems, and while we did some great work, we didn’t have some of the [data] in place that we do now.” Importantly, the figures allow government to commission on a payment by results basis, focusing on outcomes rather than paying for outputs. To commission in this way “any scheme has to pass a number of tests. The first test it has to pass is whether this is good value for the taxpayer,” Fisher says. “At the end of the day, you’ve got to configure a system whereby you’re paying up-front for results, and you’re paying sums of money that represent value for the taxpayer.” It took six months to get the Work Programme metrics right, he adds.
A cross-departmental ministerial group is currently investigating new areas where payment by results can be used. Meanwhile, Fisher’s “personal hobby horse is driving approaches to achieve multiple results, because if you can configure systems with all the providers for reducing offending, driving employment, reducing drug addiction, I think we could see some powerful progress.”
Currently, the MoJ and DWP are looking at a system where providers are recompensed both for getting people into work, and reducing reoffending. Both departments “recognise that those two objectives are completely interdependent: one of the best ways of preventing reoffending is to get somebody a job,” Fisher says.
However, expanding schemes to include more than two departments might prove more difficult, he admits. For a start, the metrics would be very difficult to work out: “This is not a short-term, easy business. This is going to be quite hard, I think.”
Is there also a problem of departments acting as free riders? The Home Office, for example, will save police time if the MoJ’s funding results in a reduction in reoffending; if it doesn’t contribute, won’t other departments be reluctant to get involved? “That may be a problem, but this comes down to leadership,” says Fisher. “If you’ve got a powerful reason for doing something and the initiative washes its face financially for the taxpayer, then I’m less worried about free riders, to be honest.” He also notes that, in the communities department, Louise Casey’s Troubled Families Unit has managed to bring together a number of departments to fund work that will reap savings for all of them.
Departments aren’t even the only source of up-front funding for these initiatives. The Social Justice Strategy envisages a key role for social investment – under which charities and private companies invest in schemes that will receive taxpayer cash only when social aims are achieved by providers. This means that departments only pay for results, and do so using the savings produced by falling demand for public services. “There is a market out there, and it is a market that wants to grow. I think we need to help it grow, and Whitehall in particular needs to help it grow,” he says. “I am told that there are plenty of investors out there with funds willing to make social investments. The issue is more configuring the demand side to create those big opportunities.”
It’s handy that there are potential philanthropists and investors willing to fund innovative schemes, because the social justice agenda doesn’t have a budget in its own right. “This is about trying to create a movement and a dynamic for change across Whitehall, when we don’t actually have a budget for this,” Fisher says. “All we have are some great ideas, and some allies and friends around the system in Whitehall and in local government.”
Austerity helps focus minds on some of these schemes, Fisher thinks, “because it forces people to look afresh at what they’re doing and think about whether there are better, simpler, smarter ways for getting results”. And an expansion of payment by results schemes will ensure that the savings are easy to measure, he says.
Welfare has been at the heart of Fisher’s career, he says, and “once you’ve worked in the welfare system for a long time, and if you’ve been through a number of reforms, you can see that you have to start getting to the root causes of these problems.” How does the old saying go? Give a man a fish and he’ll eat for a day. Listen to Mark Fisher, and more may work for life.