European Social Fund (EUC Report)

Baroness Young of Hornsey Excerpts

Wednesday 3rd November 2010 Lords Chamber

[Baroness Young of Hornsey]

My Lords, it is with a mixture of pleasure and sadness that I rise to speak in this debate. It is a pleasure to be once again participating in a debate on an EU Select Committee scrutiny report, led so ably by my noble friend Lady Howarth of Breckland, and it is sad because this is the last occasion on which the work of Sub-Committee G will have the benefit of her wisdom and leadership. I express my heartfelt thanks for all the support and guidance she has given me and other members of the EU Sub-Committee on Social Policies and Consumer Protection. She is right; it is a great job, but she has made it quite a hard act to follow, as experienced and diligent as she continues to be. We hope, although we are sad at losing her, that she is enjoying her move to Sub-Committee D on Agriculture, Fisheries and Environment.

I want to elaborate on some of the key points raised by my noble friend regarding so-called hard and soft outcomes. I should say here that although it is widely used, and although I use it myself, it is not terminology that I find particularly helpful. I also want to look in a bit more detail at the role of the third sector and sustainability.

Sub-Committee G recognises the value of the contribution of the ESF in its support of a variety of projects in different parts of the country. Based on the evidence, we concluded that it is an important component of the EU’s broader social and economic cohesion policy. As my noble friend Lady Howarth and others have stated, it is clear that we are facing huge economic challenges and such a backdrop must inevitably inform how we think across all categories of expenditure. Clearly, in such circumstances, it is all the more important that we gain maximum value for money.

I think it is worth mentioning here how useful it was to go and talk to participants in an ESF project. We visited Step Up at the Elephant and Castle, a project working with 14 to 18 year-olds, helping them to gain new skills and prepare for employment. The majority of the participants, when asked what they valued about the project, responded that the mentoring was very important. They very much enjoyed learning new skills and saw getting the educational qualifications needed for work—or for FE or HE—as really important to equip them for work, but they also saw it as important that they were helped to build up the confidence to aspire to something other than the route mapped out for those considered to be troublesome, difficult young people. This attitudinal change was crucial for them and very much a part of the work carried out at the centre.

The aim of working with those hardest to reach—those with the most difficulty in securing employment—is an aim that most of your Lordships would see as laudable and indeed essential, I am sure. Different agencies have different strengths, and this is an area where a multiagency approach, involving the Government, further and higher education, the third sector and the private sector, can have real benefits if appropriately organised. In particular, the third sector is well placed to make a substantial contribution to such programmes, as we heard from a range of witnesses and written submissions, as well as from noble Lords this evening.

Many witnesses pointed out that it is necessary to have a certain amount of bureaucracy in any programme of this sort, and we agree. Efficient bureaucratic processes serve as democratic checks on public spending. However, it is essential that these processes are proportionate to the size of the programme and help the programme to achieve its objectives, not hinder them. We recommended that the Government continue to press for the reduction in the 10-year record retention requirement for smaller organisations, whose valuable role should not be hampered by disproportionate audit requirements. We are pleased to note that the Government have assured the committee that they will continue to work for the rules on document retention to be simplified and proportionate when the structural fund regulations are renegotiated prior to coming into force in 2014.

One of our concerns is that the system of competitive tendering under cofinancing in England, while it has several merits, could lead to providers recruiting those participants who are easiest to place in the labour market; my noble friend Lady Howarth referred to that. This issue is linked to that of how the success and effectiveness of programmes is assessed. If the sole measurement of the success of a programme, and thus the basis on which providers are paid, is how many people end up in employment, it could lead to cherry picking. Of course, we understand that it is crucial that a funding programme seeking to get more people into a position where they can secure paid work delivers on that objective, and the number of people getting work as a result of participating in the programme is an objective measure of that.

However, as important as that is, by definition, many of the people who constitute what is called “hard to reach” will face a variety of enormous challenges in their quest for work. For example, someone for whom depression has meant that getting up, washing, cleaning their teeth, getting on a bus, communicating with people face to face, et cetera, whose problems are seemingly insurmountable, may take some while to reach the stage of employability. This does not mean that they will not benefit from an appropriate ESF programme. If at the end of a programme, that person is able to complete what seem to most of us to be ordinary, everyday tasks, it would represent a substantial step forwards—a step towards employability—but the person is not quite there yet.

How can we best capture the distance travelled by that individual? How can we appropriately recognise the work of a programme that enables such progress to be made? We accept that such questions are not easy ones and that it is crucial that providers are able to give a clear account, one as objective as possible, of what they think they have achieved. There are methodological evaluation models that can capture and measure this kind of progress, and these should be deployed where possible.

Our investigation led us to conclude that there is an excessive reliance on measuring hard outcomes, almost to the exclusion of soft outcomes. As we have said, we recognise that outcomes in terms of jobs secured are the ultimate and legitimate aim of ESF interventions but, particularly with the hard to reach, it is necessary to undertake intensive, intermediate work to improve employability.

Our report also recommended the use of longitudinal cohort studies, which would be useful in terms of capturing hard and soft outcomes from programmes but also, crucially, facilitate us in the assessment of the sustainability of hard outcomes, such as job retention and progression. The Government do not wish to introduce any new ESF data collection requirements for administrative and, I would imagine, financial reasons. Nonetheless, this is an important point, because so much is being invested in participants gaining work. If this work is short-lived—there would need to be a control study to check against average length of employment—and the participant is thrown back into low self-esteem, lack of confidence, et cetera, we would need to assess the success and value of that programme rather differently. In its response to this concern, the EC thinks longitudinal cohort surveys “highly relevant” to assessing the sustainability of hard outcomes. The Commission notes that some member states have been including this as an element of their evaluations since 2007, and that we could gain something from exploration of this issue. We await developments on this front with interest.

I also reiterate the strong view of the committee regarding the withdrawal of funds from richer states. Other noble Lords have spoken comprehensively about that and given a rationale, and I support those views.

Finally, focusing on sustainable development and the development of green jobs and low-carbon economies is vital globally, not just in Europe. This will be a crucial element when the priorities for the ESF in 2014-20 are being fleshed out and I agree with the noble Lord, Lord Liddle, that the alignment of the EU 2020 strategy with the ESF objectives is desirable. The issue of green skills and whether some regions in the UK are better suited than others to adapting to this agenda was one that arose. Given that the Government agree in principle that, within a reduced ESF budget for 2014-20, the most disadvantaged groups should be targeted for getting into work, what strategies will be put in place for ensuring that we have the right infrastructure to facilitate people in these priority groups to participate fully in and maximise the benefits of ESF programmes with a focus on green skills and jobs?

As the new chairman of Sub-Committee G on Social Policies and Consumer Protection, I look forward to working with colleagues following up on the issues raised in the report and the Government’s response to it.