Freud review of welfare to work recommends greater use of private and voluntary sectors

A radical review of the welfare system carried out by David Freud has suggested greater use of the private and voluntary sector to help benefit claimants.

The recommendations in Freud’s report, Reducing Dependency, Increasing Opportunity: options for the future of welfare to work include:

• Greater use of private and voluntary sector resources and expertise so harder-to-help benefit claimants receive more employment support.
• A new focus on long-term mentoring to tackle the problem of repeat benefit claimants.
• Greater rewards for organisations that are successful in helping claimants find and stay in work.
• Greater personalisation of employment support, with higher financial incentives for organisations to target resources at the hardest-to-help who need more support before they are ready to return to work.
• Retaining Jobcentre Plus’ role in helping customers during the early stages of their period on benefit and creating a new role for the organisation to assess how much support individual claimants are likely to need before they are ready to return to work.
• Rebalancing rights and responsibilities in the welfare system - matching increased support with greater obligations on claimants to look for work.
• Simplification of the benefits system.

Work and pensions secretary John Hutton said: “I welcome this report and want to thank David Freud for giving up his time to produce it. He has set out a compelling framework for the next stage of welfare reform which the government must now carefully consider.

“We must make use of all the experience and expertise which exists in the private and voluntary sector to complement the role of the public sector in delivering welfare. These groups can make a real difference in supporting the most disadvantaged into work and helping them stay in a job over the long term, rather than coming straight back on to benefit.”

Freud, a former journalist and investment banker, who was asked by Hutton to carry out the review, said: “This is a radical reform designed to reduce social dependency of the most disadvantaged.

“I am proposing a structure in which the private and voluntary sector would be prepared to invest substantial sums, with minimal risk to the state. In return, I am looking to people with more barriers to work to engage fully with the new support system.”