Pensions secretary commits to wider role for private sector in welfare reform

Work and pensions secretary James Purnell yesterday pledged to take David Freud’s welfare reform policies “to another level”.

Purnell said that welfare-to-work provision – among other public services – would be turned over to private providers on a previously unimagined scale.

Former investment banker Freud last year called for incentives for the private and voluntary sectors to get the long-term unemployed back to work.

Purnell yesterday announced that contractors would be encouraged to come up with their own proposals for providing welfare services, rather than having to wait for them to be put out to tender. A commissioning team at the Department for Work and Pensions will evaluate every serious idea, he said.

Speaking at a welfare conference in Birmingham, Purnell said: “I want to hear their proposals. I want to be able to harness this creativity, and test the ideas we receive so that we can develop the innovative ideas for future programmes or enhance the effectiveness of current ones to help even more people back into work.”

He told the Financial Times: “This is us saying very clearly that the only limit is the quality of service and the imagination of the provider.”

Asked whether even Jobcentre Plus could be run by the private sector, Purnell replied: “I’m not ruling anything out.” He added: “We are taking this to another level.”

The government is expected to reveal pilot welfare-to-work projects in the next couple of months.