Private Eye on Workfare Exploitation: Nice Little Earner

Russian serfs at work – a system Cameron and the Coalition wish to bring to Britain with workfare.

I found this article on how the government is using Welfare to Work to supply cheap labour to big business, rather than get people into work, in last fortnight’s issue of Private Eye.

‘Nice Little Earner

Welfare to work companies could end up earning more taxpayer cash by placing people into unpaid community workfare than into work, under the government’s latest scheme for the unemployed. The companies could even profit from recruiting the unpaid workers themselves.

From April, through the new Community Work Placements (CWPP, thousands of benefit claimants will have to do six-moths’ workfare for charities and community organisations or lose benefit. They will be expected to do 30 hours of unpaid work a week up to a total of 780 hours – which is more than double the 300-hour maximum offenders serve on community pay-back.

It is all part of the controversial £300m “Help To Work” package, which is aimed at the hundreds of thousands of people who leave the government’s dismal Work Programme without a job.

Favourites to run 18 schemes across the country include the scandal hit A4E and Atos, the least favourite outsourcing giant among disabled people, as well as charities such as the Conservation Volunteers, Groundwork UK, the Salvation Army and YMCA. Tender documents, however, reveal payment conflicts in the scheme that may make it as wasteful a way of getting people into work as the Work Programme itself. And with CWP, workfare companies could potential sign unpaid workers to their own businesses and be paid by taxpayers for doing so if they can show that the unpaid role has “community benefit”.

Payment will also be incremental: work companies will get 20 per cent of an agreed fee at the start of any placement, a further 20 percent when someone has been on placement or in paid work for over 12 weeks, and a further 30 percent after 22 weeks on workfare, work or a combination of the two. They only receive the final 30 percent if the claimant finds a permanent job lasting at least six months. This creates a built-in disincentive to find people temporary work before completion of at least 22 weeks on CWP – companies will earn on 40 percent of the fee otherwise. They not only lose the final 30 percent of the fee for failing to secure a permanent job, but miss out on 30 percent of the fee if a temporary job ends before 22 weeks and the company is unable to move the claimant straight into other short-term work or a work placement.

As previous studies have shown, the voluntary sector has no real need for hundreds of thousands of unpaid workers. Most charities do not have the capacity or skills to employ chaotic individuals dubbed the “hardest to help” – and many are opposed to what they see as the exploitative nature of forced unpaid work, which puts others out of employment.

Many major UK charities, including Oxfam, Scope, Marie Curie and Shelter, have said they will have nothing to do with workfare. The tender documents themselves make it clear that the Department for Work and Pensions itself does not expect to pay the full 100 percent in the vast majority of cases – it does not expect more than a fifth of participants to find a permanent job. Community work placements seem more designed to force people to worki unpaid than they do to help people find real jobs.’

Which is exactly what Johnny Void and others, including myself, are also saying.

Tags: A4E, Atos, Cameron, Charities, Coalition, Community Work Placements, Conservation Volunteers, DWP, Groundwork UK, Marie Curie, Oxfam, Private Eye, Russia, Salvation Army, Scope, Serfdom, Shelter, Welfare to Work, Work Programme, YMCA