The Jobcentre network could outsource the majority of its employment services to the voluntary and private sector, according to the minister for work.
Everything except benefits, managing contracts and deciding on eligibility could be outsourced from the 650-plus Jobcentre offices as the government attempts to revamp its welfare-for-work programmes in a proposed green paper.
The minister Margaret Hodge told the Financial Times there was “huge interest” in the proposals which aim to reduce the 2.7 million people claiming incapacity benefits.
The Association of Chief Executives of Voluntary Organisations and the Employment Related Services Association are due to meet David Blunkett, work and pensions secretary, to discuss the proposals. They will support their plans with strong evidence from Australia which has reported a 40% drop in employment costs since outsourcing its job service to private and voluntary suppliers five years ago.
Hodge said the private and voluntary sectors appeared to offer more flexibility and a more personalised service to claimants.
But last month Blunkett ruled out complete privatisation of the Jobcentre network amid reservations about whether the private sector could exercise authority against benefit claimants.