Despite having limited numbers of staff, jobcentres coped with a rapid rise in claimants after the start of the downturn. In six months (between September 2008 and March 2009), Jobseeker’s Allowance claimant numbers increased by two-thirds (from 0.9 million to 1.5 million). The Department relaxed requirements about the activities that jobcentre staff needed to undertake during 2008-09 and 2009-10, which meant jobcentres were able to prioritize checking eligibility for benefits and making sure claimants were paid.

However, the NAO found that, although the Department has continued to pursue efficiency, variations in case load across jobcentres suggest further gains may be possible. The average Jobseeker’s Allowance caseload per adviser in 2011-12 was 168, but varies by nearly 30 per cent across jobcentre districts.

The Department has simplified its performance measures and now primarily targets the move by claimants away from benefits, or ‘off-flow’, as a simple and intuitive measure of performance. However, this gives no information about how individual jobcentres perform in supporting claimants to work. Some may have found work but, in 40 per cent of cases, the reason for moving off benefits is not recorded. Claimants may have moved onto other benefits, been imprisoned or ceased claiming without taking up work.

A separate survey carried out by the Department estimated that 68 per cent of off-flow from benefit is into work. The Department has yet to decide how to adapt off-flow measures after the introduction of Universal Credit, which merges out-of-work and in-work benefits.

The need to understand performance has been increased by the Department’s move away from nationally mandated processes towards encouraging jobcentre staff to tailor support for claimants. Personal advisers are encouraged to vary the nature of their support, for example by using phone, text messaging and email as well as face to face meetings with claimants. There is also flexibility on the length, timing, staffing and number of work-focused interviews.

While flexibility encourages local innovation, the Department needs to broaden its evaluation of new approaches and improve performance measures if greater flexibility is to lead to better services.

The National Audit Office has today issued a report examining arrangements at the Department for Work and Pensions for detecting and preventing fraud and improper practices in employment programmes.

The report concludes that levels of reported fraud in employment programmes are low. The introduction of the Work Programme in June 2011 largely addressed the main weaknesses in previous programmes which had led to a risk that fraud by providers was being understated. Some risk still remain because not every control applies to every programme, particularly to smaller ones.

The report finds in particular that the Department’s past assessment of the risk of fraud at A4e missed vital evidence. The Department does not currently obtain all relevant copies of providers’ internal audit reports and did not receive the paper sent to the Chair of the Public Accounts Committee. This included evidence of nine possible cases of fraud and seven of improper practice by A4e’s staff and highlighted a possible systematic failure to mitigate the risk of fraudulent and irregular activity at both an office and regional level.

According to today’s report, the total value of cases of reported fraud investigated since 2006 is £773,000. More than half of fraud allegations since 2006 have been in respect of New Deal programmes which ended in 2011. The Department knew of the fraud risks inherent in such programmes but did not do enough to quantify and address them. Compensating controls, for example, checks at employers to verify claims that people had actually been placed in work, were not introduced.

Schemes such as the Flexible New Deal and the Work Programme that replaced the New Deal have been designed with measurable and verifiable outcomes to minimize the risk of fraud. For example, the DWP now checks the records of HM Revenue and Customs to test whether claimants are actually working. But, notably, in the case of the £8 million programme providing mandatory work activity, there are still no independent checks with employers that unemployed people said to have been placed with them for work activity have been.

Among recommendations by the NAO are that the Department make the most of the fraud risk knowledge it possesses and share it more effectively; and that users’ complaints be used to assess the quality of service providers.

Unrealistically ambitious initial targets and inconsistent implementation reduced the efficiency of the programme. Take up was much lower than expected at first, leading to underspending and the need for changes in eligibility to increase learner numbers. The now strong demand for training needs to be better managed, to make the programme sustainable while avoiding overspending this year.

Learners have nevertheless benefited from improved work skills at a basic level, and surveys of employers have provided evidence of improved business performance from the training. For many of the 554,100 learners who achieved a qualification it was their first qualification, giving them a boost in self-confidence as well as new employment skills. Some employers have reported that the training has led to improved business performance. Many of the 143,400 engagements with employers to provide advice on skills training were with ‘hard to reach’ businesses that had previously provided little or no training for their staff.

Learners’ success rates have varied substantially between training providers. In 2006-07, success rates ranged from 8 to 99 per cent for the largest 100 providers. So while some training providers have been doing a very good job and most are above the ‘minimum standard’ that is being introduced, one quarter of the largest providers were performing below the minimum. A half of employers whose employees received training would have arranged similar training without public subsidy.

The report concludes that the now strong demand for training should be used as an opportunity to focus resources on the areas of greatest need and on training with the highest quality providers. The Learning and Skills Council is taking steps to improve its management and communication of the programme – which has previously led to confusion among employers, training providers and brokers – and the Department and the LSC must be alert to the risk of disruption of these efforts by the transition to the Skills Funding Agency.

Autism, which includes Asperger syndrome, is a lifelong condition which affects the way in which people interact with the world around them. It is estimated that there are around 400,000 adults with autism in England, many of whom may require specialised support. Yet the NAO found that most NHS organisations and local authorities do not know how many people with autism there are in the areas they serve, and three quarters of local authorities do not have a specific commissioning strategy for adults with autism.

GPs and social care staff have low awareness of autism and how to diagnose it, with 80 per cent of GPs surveyed reporting that they need additional guidance and training in order to identify and treat patients with autism more effectively.

Around 200,000 adults with autism do not have a learning disability. This group often fails to secure appropriate support, as health and social care services are traditionally configured for people with a learning disability, a physical illness or disability, or a mental health problem (which autism is not). Three quarters of local authorities said adults with autism who do not meet eligibility criteria experience or report difficulties accessing the services they require. Almost two thirds felt that current services for adults with autism are limited. Providing specialised support could improve outcomes for this group of people and their carers, and potentially enhance value for money, as the costs of establishing such support could be outweighed over time by overall savings.

There are few specialised employment support services for people with autism. A lack of understanding of autism is a significant barrier to gaining employment and more training is needed for those delivering employment support and those administering benefits.

Recorded complaints probably account for some 20 per cent of all complaints received by Agencies. There is a risk, therefore, that difficulties in recording complaints may mean that Agencies could miss early warnings of poor service, systematic errors, or problems with their processes. The report also found significant dissatisfaction with how complaints were handled. The main areas of dissatisfaction were timeliness, knowledge of staff and adequacy of response given to customers’ complaints, though Agencies’ response times range from 72 to 99 per cent of their target response times.

Improving the quality of responses could prevent complaints being unnecessarily escalated. Complaints handled effectively by front-line staff can be up to 40 times cheaper than those escalated up to the final stage of the internal process. There is, however, no consistently applied Department wide quality checking of responses given to complaints to determine whether they are handled effectively by staff across the three Agencies.

Cost data on complaints is limited, but the NAO estimates that the Agencies spent between £4.7 million and £6.2 million responding to their recorded complaints during 2007-08. This figure could be up to £11 million when both recorded and non-recorded complaints are considered. The Department also made compensation payments of £3.6 million during this period, as a result of complaints.

The project was well managed, particularly the procurement aspect, where between £120 million and £140 million worth of savings were made. The project has clear lessons for other public sector procurement programmes.

Most of the offices were rolled out within four years as originally planned, although factors outside the control of the project team meant 80 offices were delivered in an additional fifth year of construction. The NAO has found that whilst this delay had an impact on the speed of improvements to customer services locally, it did not have any major operational or financial affects on the programme.

Operating out of fewer offices has released about 20 per cent of the Jobcentre Plus estate, resulting in an overall saving in running costs of £135 million a year by 2006-07. The total cost so far of disposing of buildings is £42 million, estimated to rise to £56 million once this process is complete. Two thirds of this cost consists of payments to Land Securities Trillium, the PFI contractor which managed the property on behalf of the public sector, to compensate for the reduced number of properties they manage.

Overall, customer satisfaction with the new network is high with the majority (86 per cent) of people who use the new Jobcentre Plus fairly or very satisfied with the results. However, in some others respects the quality of customer service may initially have reduced, particularly for customers unable to reach contact centres by telephone.

The employment rate for the ethnic minority population is 60 per cent, and 74 per cent for the general population.The Department has achieved its 2003 – 06 Public Service Agreement target to reduce the employment gap and is on course to meet its Spring 2008 target.

However, the gap costs the economy £8.6 billion each year and, although there have been significant fluctuations over the last 20 years, the gap is only 1.3 percentage points lower than it was in 1987. Reasons for the gap include that some ethnic minorities live in deprived areas with high unemployment; and some face discrimination and unequal treatment.

Most ethnic minorities who find employment through Jobcentre Plus do so through its mainstream services. But between 2002 and 2006, the Department introduced a number of programmes to tackle the ethnic minority unemployment gap, with varying levels of success. After spending £40 million and filling 15,500 jobs, these schemes have now been discontinued. The Department now focuses efforts on disadvantaged groups and deprived areas more generally, coupled with a move to more local decision making. This shift in focus carries opportunities to concentrate help on members of the community who are most disadvantaged, but carries the risk that ethnic minorities may not receive the help they need to gain employment.

The Department has now discontinued its programme to reach out to the ethnic minority community and help ethnic minorities who are not actively seeking work. Outreach activity by Jobcentre Plus is now discretionary, and in some offices is being significantly cut back. This risks losing the skills and experience of local voluntary sector organisations who specialise in this work, and their links to some isolated sections of the ethnic minority community. However, Jobcentre Plus advisers do an impressive job in helping ethnic minorities to find employment and a recent survey indicated few differences in the satisfaction levels between ethnic minority and white customers.

One consequence of lower employment rates for ethnic minorities is increased levels of poverty. nineteen per cent of the white population live in low income households compared with 56 per cent of the Pakistani and Bangladeshi population. And 23 per cent of white children live in low income households compared with 60 per cent of Pakistani and Bangladeshi children.

In 2005-06 over 3.6 million people who had previously been unemployed or economically inactive entered work. However, some experience difficulty staying in work, and of the 2.4 million new Jobseeker’s allowance claims made each year, around two-thirds are repeat claims.

Over a quarter of people who leave benefits and enter work return to Jobseeker’s Allowance within 13 weeks, and 40 per cent are back on benefits within six months. Looking at past trends, nearly half of all people on Jobseeker’s Allowance are likely to have at least two spells on benefits over a five year period. The National Audit Office estimates that if the time that repeat claimants spend on benefits could be halved by increasing the amount of time they spend in work, it would save the taxpayer £520 million a year.

One way to increase the sustainability of employment is to help people improve their skills, so that they can progress from short-term, entry-level jobs to better jobs. To do this, the employment programmes provided by the Department for Work and Pensions need to be better integrated with the programmes for raising skills, provided by the Department for Innovation, Universities and Skills. A number of initiatives, outlined in World Class Skills and In work, better off, have commenced to do this.

In a labour market as large as that of the UK there will always be a degree of movement in and out of jobs. There many reasons why people return to benefits and one reason is that a number of the jobs people find are only temporary – 40 per cent of repeat jobseekers allowance claimants said they were only able to find temporary work. Over 70 per cent said they were not able to find suitable employment and that barriers such as family responsibilities, low skills or disabilities made it hard for them to sustain employment once they had found it.

Improving job retention is essential for the Government if it is to meet its objectives on child poverty and employment rate targets. Lone parents are entering jobs at the same rate as the average, but leave employment at about twice the rate. A 20 per cent reduction in lone parent exit rates from work would lift 44,000 children out of poverty.