Scotland's Employability Support Services: Employability Minister's speech to Scottish Parliament

Presiding Officer, let me at the outset – lest I forget – move the motion in my name.

I welcome this opportunity today to tell Parliament how I propose to deliver one of the first of the powers devolved under the Scotland Act 2016. That is the power for Scottish Ministers to deliver employability support to help disabled people or those at risk of long term unemployment to seek, obtain and retain employment.

Parliament first debated these new powers in April 2015, which marked the start of a process of engagement on the services we want to see in Scotland. We've taken a consultative and collaborative approach to policy and programme development to listen to views and assess policy options. We've engaged with openness and determination with the UK Department for Work and Pensions and JobCentre Plus. We've made significant progress as a result.

From design to delivery

I am pleased to say we are now coming to the significant point – where we move from designing services, to delivering them.

Importantly, this government intends to deliver new powers for Scotland in the interests of the people of Scotland and with dignity and respect central to our thinking.

So, Presiding Officer, I want to set out the way forward for the smooth and seamless delivery of new devolved services and how those services will support people into employment.

And today I will also set out where we will use powers differently in Scotland, including on how our devolved employment programme will interact with the systems of conditionality and sanctions reserved to Westminster.

Today is also the opportunity for members to set out their views on these matters.

The opportunity and the challenge

We have, Presiding Officer, a significant – and unique – opportunity to deliver employment support in Scotland.

I intend to take that opportunity to deliver employment support services which will:

• reflect fair work and social and economic inclusion;

• put an emphasis on partnership delivery, building on our strengths in both the public and private sector, and in local authority, third sector and specialist delivery;

• treat service users with respect; and which

• take people with us, encouraging and supporting people into work, rather than cajoling them, regardless of circumstances.

It's fair to say, delivering these new powers is not without its challenges.

There are limitations on the powers being devolved by the UK Government. Devolution is limited to powers to replace the existing contracted services delivered by the UK Department of Work and Pensions [DWP] in the Work Programme (for long term unemployed people) and Work Choice (a voluntary disability employment service).

The Devolution Committee of the last Parliament shared our disappointment that the degree of devolution does not deliver on the Smith Commission's recommendation.

Then, only a week after publication of the Smith Commission agreement, the UK Government, despite our strong case for swift transfer of powers, announced that, rather than devolve services on expiry of their current commercial arrangements in March 2016 as had been agreed, they would actually extend the contracts to March 2017.

Then in the UK 2015 Autumn Budget Statement, the then UK Chancellor announced replacement of the current programmes with a new Work and Health Programme in England and Wales. That programme is still undefined, meaning disabled people and those who are long term unemployed in England and Wales still do not know what support services they will have.

Members can be assured that we are determined to give people in Scotland certainty about the future support our programme will offer.

UK funding cuts and Scottish Government's response

But by far the biggest impact of the UK Spending Review has been the massive funding cuts for these services.

We estimate expenditure on current DWP programmes in Scotland this year will total around £53 million. In December 2015, DWP indicated a budget for delivery of new devolved programmes in 2017 and 2018 of £7 million. This represents a budget cut of almost 90%.

As Parliament and the people of Scotland would – I think – expect the Scottish Government to, we have argued that is unacceptable. It was done with no prior consultation, after we had started consultation on our services, and it significantly undermined our plans.

The shifting policy and financial landscape imposed by the UK Government has therefore been a continual – and continuing – challenge.

But we are meeting that challenge head on, and we are on track to deliver our Programme for Government commitment to deliver devolved employability support services in Scotland from April 2017.

We have a clear sense of the services we should aim to deliver – informed by the engagement we have undertaken.

Building on that engagement, we will continue to listen to those who rely on these services so we can use their experience in developing our services.

Indeed, just this morning, I met a group of unemployed single parents in Edinburgh, and again I heard how important it is for support to gain employment to be able to adapt to meet the needs of the individual, and flexible enough to recognise child care needs, working patterns and travel to work issues.

We are also responding to the challenge posed by the reduction in funding.

Scottish Ministers have stepped in to provide up to £20 million in additional funding above the reduced settlement from the UK Government, to replace the Work Choice and Work Programme schemes.

This triples the funding being made available to exercise new devolved powers on employability from 1 April 2017.

And we have made a further commitment for subsequent years up to 2021 – to invest £20 million a year over and above the UK Government's settlement, to ensure those who most need support get it.

Our investment means we can create a strong platform for delivering future services from 1 April 2017, and in the years beyond.

It means we will continue to support the most vulnerable unemployed people in Scotland, including those with a disability.

Our aim is employment support in Scotland that:

• meets the needs of people who need support and the needs of employers in Scotland;

• reflects the current delivery landscape; and

• helps deliver sustainable employment and economic growth.

To start to deliver this, on 8 September, I announced a two part approach to services from April 2017.

In Work First Scotland, Scottish Ministers will agree a one year contract with current providers of Work Choice in Scotland. This service will deliver employment support and advice for up to 3,300 people with disabilities, with a tailored approach to meet individual needs, and including pre-work and in-work support. The procurement process is already underway, and I expect contracts to be signed in November 2016.

In Work Able Scotland, Skills Development Scotland will deliver a one year transitional employability service for clients with a disability or health condition and at risk of long term unemployment, and who want to enter work. This service will provide a combination of advice, support and coaching. This will ensure continuity of effective and accessible support for those who need it most in 2017. This means we are building on existing assets and delivery strengths, both in Scottish Government and in Skills Development Scotland.

Crucially though, the transitional year will also give us the space to define the service we will put in place from April 2018.

As part of that, we are taking forward a wider – and longer term – agenda of integration and alignment of services.

We are working to align and join up services. We are working to redefine the current complex delivery landscape, and set out where policies could better align, and where roles and responsibilities could be clearer – across Scottish Government policies and programmes, and across local authority and third sector provision.

This process will not be complete by April 2017, nor indeed by April 2018 – but it is one we must begin to ensure maximum benefit for those we need to support.

Members views today on these areas would be most useful.

Integration with JobCentre Plus – and sanctions – where we will differ

We are also working to align, where we can, with JobCentre Plus.

The Scottish Government has long argued for Scotland to have full powers over employability policy, programmes and delivery, including over the operation of JobCentre Plus.

There are still strong and compelling arguments for that, not least the process of better alignment of service I spoke of a moment ago, with a more coherent set of powers to develop the links between JobCentre Plus and devolved services, and ability to change the culture, focus and approach of JobCentre Plus.

But the current political reality is that Jobcentre Plus will remain reserved, and will be a critical conduit for people to pass into devolved employability services.

Scottish Ministers – indeed this Parliament, and much of Scottish civic society – have long been critical of the UK Government's approach to mandating – effectively forcing – people to take part in work programmes, without always considering other issues affecting their lives, leading to too many being sanctioned.

Sanctions often affect the most vulnerable in society, including lone parents, young people and those with a disability.

Those who face sanctions are often unable to comply with conditions for a range of complex reasons, including many practical and personal barriers.

Even with the devolution of this new area of responsibility that we debate today, the UK Government will remain responsible for decisions over claimant conditions in their social security system and any penalties imposed if these conditions are not met.

The sanctions regime in operation remains the policy and responsibility of the UK Government. But it is not the policy of the Scottish Government.

Existing Scottish programmes, to support people on the pathway to employment, are voluntary and give people the opportunity to participate in activities to support them into work.

I believe that we should continue to operate a voluntary approach with our devolved employment programme, where the DWP's conditionality requirement, and therefore their sanctions, will not apply.

In December 2015, the then Secretary of State for Work and Pensions indicated the extent of conditionality in our devolved employment programme was for us to determine.

I therefore wrote to the Secretary of State for Work and Pensions seeking confirmation that whilst JobCentre Plus will clearly have a central role in referring their clients into our employment programme, the Department for Work and Pensions will not require they do so on a mandatory basis, or that Jobcentre Plus clients have to take part in our employment programme to continue to receive social security support.

The Secretary of State for Work and Pensions has replied to my letter and set out a commitment for us to work together on the approach I want to take forward. He has reiterated too that the conditions in our devolved programmes are for Scottish Ministers to determine.

But let me be clear Presiding Officer, I have decided I do not want our enabling, person-centred approach to be undermined by participation under threat of DWP sanction – and my expectation is that the DWP respect that perspective and our way forward.

On that basis, I have written again to the Secretary of State for Work and Pensions today – and will continue to pursue this with him when we meet next week.

Presiding Officer, I believe that these programmes will work better if they are voluntary.

I believe our programmes will work better if we bring people with us.

I believe services will work better if they are designed around people's needs.

I believe our programmes will work better if they are seen as an opportunity, not as a threat.

I do not believe this will be the case if we enforce mandatory participation to devolved programmes.

We will maintain our good progress to deliver services in 2017, with contracts in place before the end of this year.

I will announce to Parliament next year further details and progress on our 2018 service.

Presiding Officer, the Scottish Government will deliver devolved employment programmes that support people into work, and help them tackle the barriers they face to employment.

This will be done with fairness, dignity and respect at the forefront of our minds – and at the heart of our services. I urge Parliament to endorse that approach this evening.