Committee of Public Accounts (PAC) finds JobPath scheme did not deliver value for money

PAC also recommends that any future public employment service is managed by either the Department or community-based organisations, and that all contracts between the Department and service providers satisfy procurement rules and guidelines.

In its report published today on the Examination of the 2019 Appropriation Account for Vote 37 – Employment Affairs and Social Protection and Related Matters, the Committee makes recommendations on four issues which were discussed with the Comptroller and Auditor General and the Department of Social Protection at a meeting of PAC on 12 November 2020. These are:

• JobPath;
• Local Employment Services;
• Material Level of Irregular Payments; and
• Pandemic Unemployment Payment.

Deputy Brian Stanley, Cathaoirleach of PAC, said: “JobPath is an employment support service designed to assist those who have been unemployed for more than 12 months to re-enter the workforce. It is not a job creation initiative but is intended as an employment activation service for people who are long term unemployed and who face significant barriers in returning to work.  

“Between July 2015 and October 2020 some 283,826 people had engaged with JobPath. The cost of the service totalled €247.9 million over the same period. This works out at approximately €873 per participant. This is a cheaper average price per participant when compared to Local Employment Services and direct employment services provided by the Department of Social Protection.

“However, the Committee was informed that of the 283,826 individuals who have engaged with JobPath, official statistics show that 64,000 people started work and that 22,000 people had retained their employment up to a period of 12 months. That means €247.9 million paid for employment supports through JobPath that resulted in just 22,000 persons obtaining employment for more than one year.”

Deputy Stanley said the Committee noted that JobPath has been extended for a second time to the end of this year at an anticipated cost of €50-€60 million and that since PAC’s engagement with the Department the decision has been made to cease referrals to JobPath at the end of 2021.

The PAC Cathaoirleach added: “The Committee is of the view that the JobPath model has not delivered value for money for the taxpayer and, in the majority of cases, the advice provided did not lead to sustainable employment for jobseekers. PAC recommends that the Department explores other avenues to provide better value through localised, non-profit driven employment services.”

The Committee also discussed the issue of Local Employment Services (LES) provided by Local Development Companies (LDCs). The Department stated that LES are not paid on a performance-based model and payments are made on an agreed contract capacity regardless of whether the individual obtains employment after completing the scheme. In 2020 the contracts for LES were worth €19.6 million and the caseload at the time of the Committee meeting was 18,636. This is an average of €1,052 per participant.

Deputy Stanley said: “The Committee recommends that any future public employment service is managed by either the Department or community-based organisations, and that all contracts between the Department and service providers satisfy procurement rules and guidelines. Contracts should be awarded to providers based on broader criteria than simply cost. The criteria should include the suitability of employment that will be provided to jobseekers.”

In his 2019 report, the C&AG drew attention to a material level of irregular payments totalling €117 million in 2019. According to the Department, this broke down into four main areas – fraud (€31.3m), customer error (€45m), official error (€17.5m) and estate cases (€22.6m).

Deputy Stanley said: “The Department carries out a programme of reviews of individual payment cases, usually selected on a risk assessment basis, with 609,000 control reviews carried out in 2019. The results indicate that the targeting of cases for review is relatively effective, generally identifying a higher percentage of cases with overpayment than would be expected if cases were selected randomly. PAC recommends that the Department of Social Protection continues to work in a targeted manner using control surveys as this approach appears to provide substantial results.”

The Pandemic Unemployment Payment (PUP) is a temporary social welfare measure brought in due to the COVID-19 pandemic.  The scheme is now closed to new applicants. The Committee was told that at the start of the pandemic in March 2020, some 1.5 million PUP claims were processed in less than a week. This compared to an average processing time of two to three weeks for a standard Jobseekers Assistance application.

Deputy Stanley said: “The Committee acknowledges the enormous work performed by the Department of Social Protection during the COVID-19 pandemic, given the sheer scale of the PUP scheme which was established in a short space of time. However, we would like to see the control review of the PUP scheme commence as soon as possible, so that learnings can be applied should a similar emergency support scheme be required in the future. PAC recommends that the Department provides PAC with a timeline for completion of the control review by the end of quarter one 2022.”

The PAC is a standing committee of Dáil Éireann which focuses on ensuring public services are run efficiently and achieve value for money.

The PAC Report Examination of the 2019 Appropriation Account for Vote 37 – Employment Affairs and Social Protection and Related Matters is available on the Oireachtas website.