Robert Neill (Bromley and Chislehurst) (Con)

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It is a pleasure to serve under your chairmanship, Mr Bone. In a different context, in weather like this many of us might have been told that we could remove our wigs, rather than our jackets. We do not have to do that today.

It is a pleasure and an honour to present this Justice Committee report on transforming rehabilitation. It is the result of an eight-month inquiry, during which we took significant amounts of written and oral evidence from providers and users from across the probation sector on the programme initiated by the then Government in 2014-15.

The programme was a major structural reform of the probation service, of the way probation activities are delivered, and of what probation activity comprises. It had high ambitions. Its key objectives were to reduce reoffending; to open up the market in probation services, particularly to bring in more voluntary sector providers; and to do so in a way that achieved efficiency and value for money for the taxpayer. I regret to say that the result of our investigation is that we conclude that it has failed on every single one of those measures.

Let me start by explaining why. First, reoffending rates remain stubbornly high. They are still historically high, and they do not bear comparison with those of our neighbours in western Europe and other equivalent advanced democracies. They have not been improved by the reforms. Indeed, in some areas, it is clear that sentencers’ confidence in non-custodial alternatives to imprisonment has declined, rather than improved. The objective was to have a robust system of alternatives to custody. I regret to say that we conclude that that has not been achieved.

Secondly, our evidence shows that the involvement of voluntary and third-sector organisations has declined, rather than increased. There are isolated instances of good practice, but they are precisely that: isolated, patchy and frequently outweighed by the areas where the service is not delivering to the standard required.

Thirdly, the programme has not driven efficiency. Contracts were let to community rehabilitation companies on a seriously flawed financial basis. As a result, more public money, to the tune of several million pounds, has had to be pumped into those companies to keep the show on the road. That is not sustainable.

Let me set out the report’s findings in a little more detail. The contracts are important, because the purpose of the process was to split probation provision between the National Probation Service, which is still in the public sector, and the community rehabilitation companies, which are generally owned by a consortium of large outsourcing companies, the names of which we in the public sector are familiar with, with the involvement of some voluntary-sector groups—regrettably few, given what the intentions were.

The split was supposed to be based on risk: the higher-risk offenders would be supervised by the National Probation Service, and those of a lower risk would be supervised by the community rehabilitation companies. We conclude that that had two disadvantages. First, it disrupted the considerable networks that agencies had built up at a local level. Secondly, the community rehabilitation companies were often not geared up in time to take on the new responsibilities. We conclude that the introduction of the system was, frankly, rushed. There was no attempt to pilot it or do proper assessments before it was brought in. It is also clear from our evidence that risk is a crude and ineffective measure for dividing responsibilities, because an offender’s risk profile—the level of risk they pose to the public, their risk of reoffending and so on—changes over the course of their journey. That is not reflected in the way the division is currently cast.

The other very serious issue that concerns us about the contracts is this. It is clear from the evidence that the bids by the public-private sector consortiums were wildly optimistic in their financial assumptions, which were based on an assessment that the fixed cost of running the service would be about 20%. In reality, it is 60% to 70%. They could not have been further out. That meant that they were not financially sustainable, and the Government faced the prospect either of the contracts failing or of having to pump in more money. That is not a way to run a system efficiently or effectively.

We believe that there has to be more transparency about the contracts, and that the Ministry has to look again at its capacity to deal with such matters. It is clear that the robustness of the financial model was not challenged sufficiently at the beginning. That cannot be allowed to happen again.

We are not satisfied that the monitoring of the performance has achieved what was desired. A great deal of the system depends on payment by results, but we found that in practice, that does not work as an incentive to reduce reoffending. Again, it is a crude measure, not least because some of the factors that drive rehabilitation and the risk of reoffending are outside the control of the probation providers, so it is not a well set-up system of reward. We believe that the Ministry of Justice should review that mechanism, just as it must look at the split. There have been attempts to resolve the issue, but there are basic problems with data sharing, co-ordination and so on. They must be dealt with.

We must ensure that future contracts have specific targets and incentives to involve the voluntary sector properly, as was intended. The contract structure favours the big boys, because they have the resource to put in complicated framework bids, whereas smaller-scale operations frequently get squeezed out. That is the reverse of what was intended, and we believe that that needs to be changed.

Staffing morale was found to be at an all-time low in the National Probation Service and in CRCs. Staff have higher case loads than anticipated, and often feel that, because of the artificial nature of the split, they are dealing with cases for which they do not have adequate training. We think there is a need for the Ministry to publish a probation workforce strategy covering both the NPS and the CRCs.

We need to deal with the operation of the through-the-gate system—the attempt to provide people with support on release—which we find to be wholly inadequate. In the past, people got a £46 discharge grant and nothing else. Now, they appear to get a £46 discharge grant and a leaflet. The follow-up supervision is woefully inadequate. In some cases, it is a telephone call once every six weeks. That is no way to turn lives around properly. It does a disservice not only to the offender but to the public, because it increases the risk.

We also need to look at the use of custody in shorter sentences. The intention was to give sentencers confidence that they could punish by way of community orders of one kind or another. There is nothing wrong with having a punitive element in them, but they must also have rehabilitative elements. Unfortunately, because sentencers —magistrates and judges—do not have confidence that the requirements of the order will be properly monitored or delivered, their use has declined, rather than increased. Instead, more shorter custodial sentences are being imposed, despite the fact that all the evidence shows that short custodial sentences have the worst outcomes in terms of stopping reoffending, so it becomes a revolving door. We believe that there should be a presumption against short custodial sentences, but for that to happen, the Government must put in place a robust alternative.

There are a number of other issues, which I will happily touch on if asked to by hon. Members, but I hope that I have given an overview of a serious report, which was agreed by the Select Committee unanimously, cross-party, on the basis of compelling evidence. All the Ministers in the team are new to their post. They are having to pick up the pieces of something that was misjudged, but there is a chance to put it right. It is a question of properly reforming the system so that it works properly, which would be to our economic advantage, because the cost to our economy of reoffending is £15 billion or more, but it would also benefit society, because less reoffending means fewer victims, and that is in everyone’s interests.

Robert Neill

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I very much agree. I hope—indeed, I am sure—that my hon. and learned Friend the Minister will take that view back to her ministerial colleagues. It is very clear that the situation was not acceptable. Putting more and more sticking-plaster money into the system is not a sustainable way forward. I am glad to say that on an earlier occasion when the Minister of State gave evidence to us, he said, as hon. Members will recall, that removing or terminating contracts, if they were failing, was absolutely an option on the table, and so it should be, because the whole point of contracting out is that if there are failures, we can take the contract away, but for that to be done, there has to be a willingness both to do it and to put something workable in its place. The right hon. Member for Delyn (David Hanson), whose work I very much appreciate, makes a most important point.

Robert Neill

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Yes, I think that is right; I do want to be constructive. Whether or not we would have started from here is an interesting question for debate, but we are here. Turning round systems such as this is a bit like turning round an ocean liner: it takes a long time. A U-turn is not practical, it seems to us, in these circumstances. That is why we say that an urgent review by the Ministry is necessary right across the piece to start identifying the areas of failure and start working on them immediately. I hope that our report helps to set out for the Ministry where that work needs to be done.

Robert Neill

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I am grateful to the hon. Gentleman for those comments. I am not sure how far the roll-out has gone so far, but we certainly believe that the move in Scotland is in the right direction, and that is evidenced by the situation in many other jurisdictions, where there has been the same effect. I would not want to be held to specific numbers, but I think that the direction of travel to which the hon. Gentleman refers would be absolutely right. I do not think that there are basic, underlying causes that make the English more intrinsically criminal than the Scots, or more prone to reoffending than the Scots, the Germans, the Dutch or our other neighbours—it is tempting fate to say that to the hon. Gentleman, but with a middle name of MacGillivray, perhaps I can say it. I do not think that is the case, so I think we should pursue this proposal. The key bit, I think, is systemic failures, rather than underlying social causes.

Robert Neill

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The hon. Gentleman, whose work on the Select Committee is much appreciated, is absolutely right. There are examples of good work being done in the system. In the north-east in particular, there are some areas where the voluntary sector has worked well, taking a leading role within CRCs, but they are the exception to the rule. That is why we think that the new system must have specific targets for the voluntary sector, and means of getting it into the system. I know from my experience over the years that the voluntary sector is much more flexible. It is much more able to calibrate to the local social, economic, job-market and housing-market needs, which are all-important in rehabilitation, and is able to build up links at local level with the relevant agencies, in a way that so far has tended to be lacking in the very large and sometimes remote organisations. The hon. Gentleman is totally right.

Robert Neill

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That is absolutely right. My recollection is that that was not the way through the gate was sold at the time it was brought in. I think there is a little bit of rewriting of history there, to be blunt. The truth is that for a long time we have been appallingly bad at follow-up supervision of people who are released. Through the gate actually extended it to those serving sentences of one year or less, which indicates that the Government thought that it was a good thing, but that has not been delivered in practice. We do need a wholesale review of it.

For example, if the CRC becomes involved with an offender only about 12 weeks before their release, that is wholly inadequate, in terms of setting that person up with the support that they need when they come out. We suggest that during that time, there be work to ensure that bank accounts are set up, and that people can register for universal credit, so that they get it on the day they leave custody, rather than coming out with their £46 and not necessarily having a roof over their head. The temptation for them then is to go straight to meet their mates at the pub or the café; they spend their £46; and then they are back into exactly the same sort of offending—often to drive drug, alcohol or other habits—that got them into prison in the first place. The leaflet in their pocket, which is supposed to do the signposting, is not much use to them in those circumstances.

Robert Neill

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One problem that we have, to which we refer in the report, is the lack of transparency around the contractual terms. One would expect, if there were a complete failure of performance, that there ought not to be significant payments, as with any contract, but we do refer to the tendency—it is not unique to the Ministry of Justice; it is across Government—for the excuse of commercial confidentiality to be used almost as a blanket bar to examining terms. That is why we recommend in the report that there be much more transparency around the letting or re-letting of contracts. We should certainly have more transparency about the matrix on which they are based, the financial model, the performance criteria that are built into them and the means of performance measuring of the CRCs themselves. We do not have adequate information on any of that, and I think the public are entitled to it.