From Private Eye: Welfare to Work Companies and the Profits of Workfare


The mad jobcentre manager from the League of Gentlemen, who delighted in humiliating claimants, while doing everything she could to stop them from actually getting a job. This is definitely case of life imitating art.

In their issue for the 24th January – 6th February 2014, Private Eye published this story about how changes in government legislation could allow welfare-to-work companies to earn more from placing their unemployed clients in workfare than from actually finding them a paying job. The article ran:

Welfare to Work
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 (CWP), thousands of benefit claimants will have to do six-month’s workfare for charities and community organisation lose benefits. 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 potentially sign unpaid workers to their own businesses and be paid by taxpayers for doing so if they can show that the unpaid role has a “community benefit”.

Payment will also be incremental: work companies will get 20 percent 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 finial 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 only 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 work unpaid than they do to help people find real jobs.

A few days ago, I posted up another piece from the Eye reporting that several members of one of the workfare companies had been prosecuted for fraud. They altered the figures of the numbers of people for whom the company had found work. The companies only get paid for their results, and the government actually expected most to fail when they set the scheme up. Now it also seems that workfare is almost deliberately structure to keep people in unpaid work.

This will, of course, come as absolutely no surprise to anti-workfare campaigners like Johnny Void. Void has made clear many times, along with other left-wing blogs and those by the unemployed themselves, that workfare is basically just a modern form of slavery. I have myself posted blog pieces pointing out the similarity between workfare, and the compulsory ‘voluntary’ work put in practice in the Third Reich, the Reichsarbeitsdienst, and the use of slave labour in the Nazi concentration camps and Gulags of Stalin’s Russia. This article suggests that the similarity is not accidental. Workfare really is slave labour, to exploit the unemployed.

As for the charities named in the article, Oxfam, Scope, Marie Curie and Shelter are to be congratulated and praise for their principled stance against this exploitation. The opposite goes to the Conservation Volunteers, the YMCA, the Salvation Army, and Groundwork UK. They have been named repeatedly by bloggers like Mr Void as exploiters. For this, they deserve nothing but contempt and opprobrium.

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2 Responses to “From Private Eye: Welfare to Work Companies and the Profits of Workfare”

  1. sdbast Says:

    Reblogged this on sdbast.

  2. arthurstreeb Says:

    Reblogged this on All that is wrong with the UK, and right..

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