Ireland offers a particularly fascinating case for studying the interplay between the social policy turn towards activation and the governance turn towards marketisation. Until relatively recently, it was very much a latecomer to the contemporary workfare project, but since 2010 it has undergone a period of ‘rapid and compressed’ reform (Dukelow, 2021: 47). The scale of change has been likened to a ‘transformation, not just of policy and processes, but of the entire spirit of welfare’ (Boland and Griffin, 2018: 101) in Ireland. The drivers of reform are complex and much debated (see Dukelow, 2015; Murphy, 2016; Hick, 2018). Ireland’s financial bailout by the Troika (the International Monetary Fund, European Central Bank, and European Commission) in late 2010 was clearly an important catalyst, as was the threefold increase in the number of people on unemployment payments from 2008 to 2011.
The Troika insisted upon structural welfare reform as a condition of bailout, emphasising especially the need for greater ‘conditionality on work and training availability’ and stronger ‘sanction mechanisms for beneficiaries not complying with job-search conditionality’ (European Commission, 2011: 63). This followed on the heels of an OECD review that heavily criticised Ireland’s pre-crisis welfare model for allowing
To appreciate the magnitude of reform over the past decade, it is helpful to first understand the contours of Ireland’s pre-crisis welfare state and the activation model that presided during the early 2000s. Accordingly, the chapter begins by briefly reflecting on the pre-crisis period and considering the extent to which Ireland resembled a ‘liberal’ welfare state. This is followed by a detailed excavation of the changes to income supports that were enacted following the crisis, which saw Ireland’s welfare state evolve from ‘a predominantly passive system’ (J Whelan, 2021: 10) focused on training and job creation into one more and more focused on accelerating job-search conditionality. Yet the success of these reforms would depend on the country’s institutional capacity to implement activation. This was far from a given, considering the extensive criticisms – not just from the OECD but also domestic actors – that Ireland’s active labour market programmes were ‘fragmented, and lacking ambition’ (NESC, 2011: xv).
Institutional reform was clearly much needed. As detailed, this took the shape of integrating income and employment supports but also, crucially, outsourcing activation of the long-term unemployed to private providers through the competitive procurement of a new JobPath service. This turn towards
Ireland’s ‘pre-crisis’ welfare state
Ireland is often now considered a liberal welfare state (Dukelow and Kennett, 2018) but this has not always been the case. Indeed, positioning the Irish welfare state of the late 1990s and early 2000s within the comparative worlds of welfare capitalism has been described as ‘a highly moveable feast’ (Cousins, 1997: 226) given the country’s ‘mix of ideological influences’ (Daly and Yeates, 2003: 87) from liberalism, to Catholicism, to colonialism, and nationalism. For instance, where Murphy suggests its broad features ‘were largely consistent’ (2016: 434) with a liberal regime given the degree of inequality and weakness of labour market regulation, Payne and McCashin (2005) position it as closer to a ‘Catholic corporatist’ regime. This was due not only to the historical role of the Catholic Church in shaping welfare state development (Cousins, 1997; Daly and Yeates, 2003) but also the presence of strong social partnership institutions incorporating employers, unions, and latterly the community sector in national negotiations on wage regulation and social policy from the late 1980s until 2008.
The main motivation for grouping ‘pre-crisis’ Ireland as a liberal welfare state was its proximity to Britain, and the fact that its building blocks were a legacy of its colonial past (Cousins, 1997; Daly and Yeates, 2003). However, several features differentiated it from its neighbour and liberal regimes more
FÁS was formed in 1987 when Ireland’s National Manpower Service merged with the Youth Employment Training Agency and another vocational training agency known as AnCo. It was therefore anchored in a predominant focus on vocational training and governed by a board of management appointed by the Minster for Enterprise, Trade, and Employment rather than the Minister for Social Protection. From the late 1990s, under the National Employment Action Plan (NEAP) that Ireland developed to implement the European Employment Strategy, claimants were to be referred to FÁS for job-search assistance after three months on payments. FÁS would also act as the point of referral for directing claimants to externally delivered programmes such as training courses provided by further education and community colleges; work-experience placements through the Community Employment (CE) programme; job-search training provided by Job Clubs; and more intensive guidance services for the long-term unemployed provided by LES. However, FÁS case officers ‘rarely’ (Grubb et al, 2009: 95) mandated participation in these
Despite the near absence of sanctions or job-search conditionality, Ireland’s spending on active labour market measures was relatively high at 0.64 per cent of gross domestic product (GDP) compared with between 0.35 and 0.39 per cent of GDP in other Anglophone countries (NESC, 2011). It was also focused on a different mix of measures.
Bonoli (2010) classifies activation measures into four ideal types: (i) ‘incentive reinforcement’ approaches such as time limits on payments, and sanctions for work refusal; (ii) ‘employment assistance’ programmes such as job-search services; (iii) ‘occupation’ measures such as public or community work placements; and (iv) ‘human capital investment’ through education and vocational training. In broad terms, workfare models favour ‘incentive reinforcement’ and ‘employment assistance’ measures over human capital investment or occupational measures. However, Ireland’s pre-crisis model was characterised by expenditure on ‘occupation’
In summary, Ireland was a comparatively high spender on activation programmes but lacked a coherent ‘overall labour activation framework’ (Murphy, 2012: 40). To the extent that it had an activation model, it was ‘low-intensity’ (NESC, 2011: xv) and more akin to being a human capital rather than workfarist model. Wiggan attributes this to years of ‘propitious economic growth’ during the Celtic Tiger period, which enabled successive governments to increase expenditure while showing ‘little interest’ (2015b) in activation. Others point to Ireland’s social partnership model, which afforded a series of veto points for unions and community organisations to block politically contested reforms. Inward migration from EU expansion also meant that employers could meet labour shortages by importing labour rather than ‘the more difficult challenge of activating reserve domestic labour’ (Murphy, 2012: 35).
Austerity and activation
The financial crisis was a watershed for activation policy development in Ireland for both political and fiscal reasons. Policy inertia was no longer an option as the number of people claiming unemployment payments soared along with the country’s fiscal deficit. The incidence of very long-term unemployment (lasting two years or more) increased from below 1 per cent in 2007 to 6.4 per cent by early 2011 (Köppe and Maccarthaigh, 2019). This prompted a threefold increase in the number of people on the Live Register, from 158,752 people in January 2007 to a peak of 470,288 claimants in July
The financial crisis quickly became reframed ‘as a debt crisis’, the solution to which was presented as a ‘politics of austerity’ (Dukelow and Considine, 2014a: 59). Faced with a choice between raising taxes and cutting expenditure, Ireland opted decidedly for fiscal consolidation. This was underpinned by the belief that high taxation would undermine any future recovery and that, as the then Minister for Finance argued, Ireland would ‘not create jobs by increasing the penalty on work and investment’ (Lenihan, 2009). Even before Ireland’s loan agreement, all major parties had embraced the need for austerity. A special group was established in 2009 to find fiscal savings through spending cuts, proposing €5.3 billion of budget cuts that included €1.8 billion in cuts to social protection (Hick, 2018: 6).
In December 2010, a coalition government led by Fianna Fáil and the Greens formally signed a Memorandum of Understanding with the Troika to financially bail Ireland out. That government soon lost office, with Fine Gael and Labour winning power and taking responsibility for implementing the terms of Ireland’s loan agreement. The Troika’s presence coupled with the fact that the agreement was signed by a previous government provided the new government with ‘scope for “blame avoidance”’ (Hick, 2018: 2) to push through strategies of ‘coercive commodification’ (Dukelow and Kennett, 2018: 496) that Hick (among others) suggests were essentially domestic in origin.
Written into the bailout terms were obligations to reduce expenditure on social protection by €750m in 2011, along with ‘strengthening activation measures’ through, among other things, applying ‘sanction mechanisms for beneficiaries not complying with job-search conditionality and recommendations for participation in labour market
Payment cuts, sanctions, and conditionality
Activation reform initially followed a trajectory of simultaneously reducing the compensatory elements of welfare while intensifying regulatory conditions. A series of rate cuts to all unemployment payments were announced in the 2009 and 2010 budgets. The headline rate of Jobseekers Allowance and Jobseekers Benefit was reduced from €204 to €188 per week (Collins and Murphy, 2016) while the payments of younger jobseekers were cut to just €100 per week for those aged 21 or under (excluding those with dependent children) and to €150 per week for those aged between 22 and 25 years of age (Cousins, 2019). This was justified on the grounds of
Ireland progressively reoriented its system towards incentive reinforcement via a three-pronged approach of ‘reducing benefit levels, reducing duration of entitlement, and tightening eligibility conditions’ (Dukelow, 2021: 50). To this end, the number of contributions that were needed to qualify for unemployment social insurance – the contributory Jobseekers Benefit (JB) – were doubled while the duration that people could remain on JB was reduced to between one and two years.
The use of conditionality was also intensified under the Social Welfare Miscellaneous Provision Act, which came into effect in April 2011. The act introduced new ‘penalty rates’ in the form of a 25 per cent reduction in payments that could be applied to those on jobseeker payments. While less severe than the nine-week disqualification that previously applied, these penalty rates could be applied in a wider range of circumstances including ‘failure to participate in an appropriate employment support scheme, work experience or training’ (Cousins, 2019: 32). Moreover, the capacity to levy sanctions in the form of payment reductions rather than payment disqualification also served to make the threat of being sanctioned that bit more palpable. Case officers, presumably, would have less reservations about reducing a person’s weekly payment by €44 than they would have about disqualifying someone from payments for up to nine weeks. This appears to be reflected in the data which points to a continuous growth in the number of people penalty rated during the post-crisis years. In 2012, a total of 1,471 claimants were penalty rated. By 2016, this number had reached 9,565 claimants, rising to a total of 12,380 people in 2018 – and
In early 2012, the benefit cuts and changes to eligibility conditions outlined earlier were consolidated into a formalised activation strategy, Pathways to Work. The strategy marked a decided turn towards a more Australian-like mutual obligations model of activation. The government promised substantial institutional reform of employment services so that people would ‘no longer remain on the Live Register for lengthy periods without an appropriate offer of assistance from the state’ with the flipside being that ‘individuals will be made aware of their responsibility to commit to job-search and/or other employment, education and training activities or risk losing welfare entitlements’ (Government of Ireland, 2012: 5–6, emphasis added). This individualised responsibility would now be formalised in a new welfare contract, the Record of Mutual Commitments, to be entered into at the point of claiming benefits. It would be further documented and updated in Personal Progression Plans (PPPs) that jobseekers would agree with an assigned employment advisor or case manager.
A new statistical profiling tool would also be introduced to assess jobseekers’ ‘Probability of Exit’ (PEX) from unemployment during the first 12 months of their claim. Claimants would complete a profile questionnaire as part of the registration process. Those with a high PEX score would be steered towards self-directed job-search activity for the first three months; those with a mid-point PEX score would be referred for group sessions ‘on how to improve their job-search activities’; while those with a low PEX score or who were on payments for 12 months or more would be referred for ‘one-to-one support from an experienced employment services advisor’ (Government of Ireland, 2012: 12). Initially, this more intensive case management was to be provided either
Widening conditionality
As Ireland’s activation model devolved around conditionality and incentive reinforcement, its reach was also extended. Pathways to Work tightened the focus on activation into full-time employment. Opportunities for combining benefits with part-time employment became more restricted as claimants in part-time employment became subject to in-work conditionality. Another early proposal was to consolidate all working-age payments into a Single Working-Age Payment that would see the forms of job-search conditionality that were applicable to those on jobseeker payments extended ‘to lone parents, partners/spouses, people with disabilities and carers’ (Collins and Murphy, 2016: 74).
Ultimately, the attempt to extend conditionality to those on disability or carers payments and to partners – or ‘qualified adults’ as they are known in the parlance of Ireland’s (male) breadwinner model – lost momentum. Successive governments have largely continued to treat welfare dependency as unproblematic provided someone is not considered the ‘primary’ income earner in their household (Murphy, 2018; Dukelow, 2021). Lone parents, by contrast, have not received the same degree of political protection from activation (Collins and Murphy, 2016). Reflecting different ‘dynamics of deservingness’ (Dukelow, 2021: 56) in Irish social policy, they have been targeted through a series of changes to the eligibility conditions for the One Parent Family Payment which, at the time of the crisis, was payable up until a person’s youngest
Administrative and governance reform
The upshot of the changes to social security just reviewed has been what Whelan describes as a widening of ‘the compulsive geography of the Irish welfare state’ (2021: 14). The experience of claiming payments has become characterised by increasing levels of conditionality as Ireland’s system of social protection has ‘entered a stage of continuing compulsion’ (Whelan, 2022: 26). In the process, the problem of unemployment has also become reframed in increasingly individualised terms; as a ‘personal failure to be remedied by personal transformation’ (Boland and Griffin, 2021: 171) in the form of claimants becoming ‘more active in their efforts to find work’ (Government of Ireland, 2012: 10, emphasis added). Having outlined the key changes in social protection, the remainder of the chapter details the administrative and governance reforms of service delivery organisations that have followed suit. For, as discussed in Chapter One, the march of workfare has as much to do with the reconfiguration of street-level organisations as it has to do with formal shifts in active labour policy.
The first major administrative reform was a long-overdue overhaul of the national training and employment authority, FÁS. The state-run employment service had been much criticised for its weak implementation of pre-crisis policy commitments to activation (Grubb et al, 2009; NESC, 2011; McGuinness et al, 2019), and pressure on FÁS intensified when a corporate governance and expenses scandal broke in late 2008 culminating in the resignation of its director (Murphy, 2012; Köppe and MacCarthaigh, 2019). Shortly afterwards, a proposal to merge income and employment supports into a National Employment and Entitlements Service was announced. This integration of benefits and employment supports was standard in other European countries and a core recommendation of the OECD’s review (Grubb et al, 2009: 132). It had also been ‘a long-standing’ (Köppe and MacCarthaigh, 2019: 142) reform ambition in Ireland but one that had hitherto failed to gain any political traction partly due to resistance from public sector unions who opposed merging staff from a semi-autonomous agency and a government department with ‘distinct organisational cultures’ (NESC, 2011: xxiv).
The newly elected Fine Gael/Labour government was determined to press ahead with the reform, making the integration of all employment and benefit supports into ‘a single delivery unit’ (Government of Ireland, 2011: 8) under the responsibility of the DSP a core plank of its programme for government. It dissolved FÁS in late 2011, transferring its training functions to 16 new regional Education and Training Boards that were overseen by a new Further Education and Training Authority (SOLAS). The DSP would assume oversight of all employment services, with the approximately 700 employment services staff of FÁS being subsumed into the department along with about a thousand community welfare officers from the Health Service
Local Employment Services
The dissolution of FÁS and transfer of its employment services functions to the DSP also had far-reaching ramifications for Ireland’s externally delivered employment services, which had previously operated under contract to FÁS. In 2011, these contracted services mainly comprised programmes operated by community organisations:
Jobs Clubs operated by 40 not-for-profit organisations across 43 locations to provide short-term (one to four weeks) job-search assistance and group training primarily for those considered ‘job ready’;
Employability services for people with a health condition, injury or disability (who participated voluntarily) were delivered by 24 not-for-profit organisations in 31 areas; and
LES operated by 22 not-for-profit organisations (mainly local development companies) across 25 different locations to provide intensive employment guidance to long-term unemployed and other jobseekers considered more distant from employment.
LES have been a feature of Ireland’s employment services system for more than 25 years. They were established in 1995 following the recommendations of a National Economic and Social Forum report on long-term unemployment, which called for more intensive and locally based employment services to be provided alongside FÁS in areas with high labour market exclusion. As such, they are intendedly place-based services. This is also reflected in the fact that the vast majority are delivered by local development companies or ‘partnerships’, many of which also provide other labour market programmes such as Jobs Clubs and the CE programme. These state-funded companies operate on a not-for-profit basis under the governance of boards comprised of elected officials, representatives of statutory bodies, members of community organisations, trade unions,
Up until the post-crisis period of welfare reform, LES were anchored in a ‘guidance-led’ (N Whelan, 2021: 92) and voluntary engagement model focused on the needs of those more distant from the labour market. However, the Pathways to Work activation strategy saw a shift in the LES client-base as the bulk of their caseload became jobseekers referred by Intreo for mandatory activation. Whelan observes how the ethos of LES as guidance-led services became ‘diluted’ by the shift from FÁS to the DSP, and the associated focus on mandatory activation (2021: 92).
Another important change was the introduction of targets and performance measurement as the DSP increasingly sought to steer contractors through instruments of corporate governance. In 2013, LES were set the target of progressing at least 50 per cent of their annual caseload into training or employment. In 2016, this was revised to focus exclusively on job placements and up until 2021 each LES provider had a target of placing at least 30 per cent of its activation clients into 30 or more hours of employment per week (although job sustainment was not measured). This was a blanket target that proved controversial for its failure to take any account of local labour market variation or differences in providers’ caseload mix (McGann, 2022a). A review of LES performance conducted on behalf of the DSP found that only half of LES achieved the target in 2016 (INDECON, 2018). The review highlighted the absence of financial penalties for under-performance, criticising the lack of a ‘systemic link between funding of the LES and their performance’ (INDECON, 2018: xi). It recommended active consideration of a ‘competitive procurement model for future provision of services’ (INDECON, 2018: xiii), which ultimately eventuated in late 2021 when the DSP announced a request for tender for new Local Area Employment Services – to be partly funded based on Payment-by-Results – that would replace the existing LES and Jobs Clubs contracts.
The integration of income support and employment services under Intreo, and changes to how LES were contracted following Pathways to Work, undoubtedly constituted major institutional reforms of employment services in Ireland. However, it is arguably the commissioning of JobPath that has been the most far-reaching post-crisis governance reform given the extent to which it marked a decisive turning point towards market governance in the delivery of welfare-to-work.
The contracting of private providers had been flagged in Pathways to Work, which cited the UK and Australian examples of ‘activation outsourcing’ and procuring services based on ‘Payment-by-Results’ as a model that had ‘proven effective’ (Government of Ireland, 2012: 21). Nonetheless, the DSP maintained that it was not any philosophical belief in the superiority of marketised implementation structures but sheer practical necessity that dictated the need for outsourcing. The surge in claimant numbers coupled with the policy shift towards active case management had severely stretched existing employment services capacity, with Ireland having a ratio of approximately 1,000 unemployed jobseekers per case manager in 2014 compared to international norms of between 100 and 150 clients per advisor (DEASP, 2019: 8). With a freeze on public sector hiring, the DSP’s secretary general argued before a parliamentary committee that the combination of ‘direct and contracted resource capacity [was] insufficient to provide a high level of service to all of the people currently on the Live Register’ and that procuring additional services from the market was therefore critical ‘to cope with a cyclical but diminishing peak in caseload’ (cited in Murphy and McGann, 2022: 6).
The procurement of JobPath was formally framed in pragmatic terms as a mechanism to bring onboard additional case management capacity (Wiggan, 2015b). Nonetheless, it was also an ‘opportunity in crisis’ (Murphy and McGann,
The request for tender to deliver the new employment service suggested ‘a striking resemblance’ (Lowe, 2015: 117) between JobPath and a neighbouring employment services market, Britain’s Work Programme. This came as little surprise to Irish social policy observers since the DSP had engaged the UK’s Centre for Economic and Social Inclusion to develop JobPath’s procurement model. Like the Work Programme, JobPath would follow a ‘prime contractor’ model. Rather than contracting with tens of providers, the government would instead deal with a select few ‘well-capitalised “top tier” providers’ (Wiggan, 2015a: 120). These ‘primes’ would be awarded high-value contracts for large areas but be permitted to subcontract some or all of service provision. This was how the Work Programme then operated: 18 ‘primes’ were contracted by the Department for Work and Pensions (DWP) to manage delivery in the same number of contract package areas (with at least two primes per contract area). But beneath these primes were hundreds of supply chain partners that the DWP had no direct oversight of.
The advantage of this model was that it reduced transaction costs for the purchaser from fewer bids to evaluate, fewer contracts to negotiate, and fewer providers to monitor.
Providers also received differentiated payments depending on the duration of full-time employment – 13, 26, 39, or 52 weeks – clients sustained, and the customer group they were in. To incentivise providers to focus on their more disadvantaged clients, JobPath participants were segmented into different customer groups based on their duration of unemployment ‘with more challenging clients attracting larger payments’ (Lowe, 2015: 121). Again, this differentiated payment model closely mirrored the design of the Work Programme, which offered higher payments if clients were receiving a disability or illness payment rather than a jobseeker’s allowance. However, in the case of the Work Programme, the differential pricing model proved ineffective. One key reason was that providers felt that the prices on offer for outcomes with more disadvantaged groups were not high enough to offset the additional costs they
The DSP initially invited bids to deliver JobPath in four areas: Border, Midlands, and West (Lot 1); Cork Central, Southeast, and Mid-Leinster (Lot 2); South and Southwest (Lot 3); and Dublin (Lot 4). However, tenderers could combine areas into ‘super lots’ (Lowe, 2015: 118) as the two successful bidders, Seetec and Turas Nua, did. The two successful bidders also each brought experience of delivering the Work Programme to the Irish market. Seetec, which at the time held Work Prorgamme prime contracts in three areas, was awarded the JobPath contract for Dublin and the Border, Midlands, and West areas. Turas Nua, which was awarded the JobPath contract for all remaining areas, was a joint venture between the Irish cooperative FRS Recruitment and the UK-based Working Links, which delivered the Work Programme in Scotland, Wales, and southwest England.
Each provider had a monopoly in different parts of the country, confining the dynamics of market competition to the tendering stage. This was a significant departure from the UK and Australian markets that had informed JobPath’s design, which included multiple providers in each area on the assumption that the innovation and efficiency gains of quasi-market models depended on maintaining competition between ‘a sufficiently large number of service providers’ (Struyven and Steurs, 2005: 7). For instance, in the Australian model, there are periodic business reallocations from low to high performing providers, meaning that under-performing agencies risk losing their share of clients within a region. There was no such ‘post-procurement competition’ (Wiggan, 2015b) in Ireland’s quasi-market, even if jobseekers could in theory always be redirected to LES as an alternative to JobPath. One rationale for contracting only one provider per region was the need to create a stable market. The DSP
A further point of departure from the Work Programme contract model was JobPath’s ‘grey-box’ design. Minimum standards concerning both the content and frequency of services were specified in detail. Employment offices would have to be located no more than one hour by public transport from where clients lived. Providers would also be required to conduct a one-on-one appointment with each client within 20 days of referral, and to maintain monthly meetings thereafter. Other minimum requirements included drawing up a PPP for each client at the first meeting and reviewing this quarterly. Caseload sizes were also capped at 120 jobseekers per advisor and were to be enforced through periodic inspections of contractors’ offices coupled with monthly meetings between the DSP and the two contractors to review their performance and compliance (Roche and Griffin, 2022). To further incentivise a focus on quality, customer satisfaction surveys would be conducted at least annually. This focus on service-users’ experiences was written into the contract, along with a clause allowing the DSP to reclaim up to 15 per cent of contractors’ payments if they were evaluated poorly by service-users.
For these reasons, JobPath can best be described as falling somewhere between a state-managed and provider-directed quasi-market. Since its commencement in mid-2015, the state has substantially ceded control over the delivery of welfare-to-work to private companies – commoditising claimants in a way that they had hitherto been shielded from in Ireland (see Chapter Three). Yet private agencies have not been given the same free rein over service delivery that they have enjoyed in other liberal welfare states; most notably during the early years of Australia’s Job Network (1998–2003) and under Britain’s Work Programme which were both ‘black
Creeping marketisation
JobPath marked a major turning point in the governance of employment services in Ireland. It has been likened to a process of ‘privatisation by stealth’ (Murphy and Hearne, 2019: 457) in that it was introduced without much public debate and with far-reaching implications for the sectoral division of welfare. It has seen Ireland’s employment services landscape evolve from a two-tiered to a three-tiered mixed economy of activation that is now firmly underpinned by market governance. The impact on community sector providers was immediately felt in terms of a sharp decline in client referrals, from 71,424 activation referrals to LES in 2015 to just 39,984 in 2017 (Lavelle and Callaghan, 2018).
The marketisation logic underpinning JobPath has increasingly come to be viewed as a threat to the model of local, not-for-profit provision that predominated during the late 1990s and early 2000s. Several motions have been brought before the Dáil (Ireland’s lower house) calling for the government to roll back the marketisation of employment services. The first of these was in February 2019, when Sinn Féin representatives successfully brought a motion calling for the DSP to ‘immediately cease all referrals to the JobPath service’ and to ‘end the use of “payment-by-results” models in job activation schemes’ (Dáil Éireann, 2019a). This followed a series of hearings and submissions to an Oireachtas (Parliamentary) Committee on Employment Affairs and Social Protection that were highly critical of JobPath’s funding model and ethos (see Murphy and McGann, 2022).
In late 2021, JobPath again came under sustained criticism from two Oireachtas committees. The Joint Committee on Social Protection, Community and Rural Development, and the Islands questioned its public benefit, when a total
The context for these criticisms was the DSP’s decision to submit all externally delivered services to a second wave of competitive procurement from mid-2021. This included not just JobPath (which was due for re-procurement) but also LES and Jobs Clubs, which had not previously been subject to any form of competitive procurement in what the DSP argued contravened ‘good governance and public procurement practice’ (DSP, 2021a: 4). The competitive procurement of these latter programmes was first mooted in late 2018, when the then Minister for Social Protection informed the CEOs of partnership companies that the government was seeking to introduce open competition for the existing Jobs Clubs and LES contracts. The DSP subsequently repeatedly stated that it received advice from the Attorney General’s office that it was legally required to competitively procure any further external services.
In 2019, the UK-based Institute for Employment Studies and Social Finance Foundation were engaged to advise on the procurement and design of all externally delivered employment services. They recommended a model of staged
The COVID pandemic ultimately disrupted these plans to place Ireland’s externally delivered employment services ‘on a proper contractual footing’ (DSP, 2021a: 4). In June 2020, all existing contracts were extended for a further two years in anticipation of a pandemic surge in demand for activation. However, in May 2021, the DSP took its first step towards wider system change when it announced a request for tender for four new Regional Employment Services. These services would be delivered in counties then under-serviced by Jobs Clubs or LES, including Donegal, Sligo, Leitrim, Laois, Offaly, Longford, and Westmeath. This was to foreshadow a country-wide procurement of Local Area Employment Services announced in late 2021. It accompanied the release of an updated Pathways to Work 2021–25 strategy, which committed to expanding the caseload capacity of employment services by 100,000 jobseekers per annum and reducing the rate of long-term unemployment to 2.5 per cent by 2025 (Government of Ireland, 2021).
In questioning before the Oireachtas, the Minister maintained that the DSP was not looking to privatise employment services nor was the contract model ‘a for-profit driven agenda by any manner or means’ (Select Committee, 2021). Nonetheless, the request for tender indicated an extension of market governance in that outcome payments – for placing participants into 17 weeks or more of full-time employment – would now constitute 37 per cent of the total potential payments per client. The remaining payments would be comprised of a service start fee (33 per cent) and a fee for completing job plans (30 per cent)
A defensive campaign was mounted to preserve community-based employment services, including strike action by LES staff and political interventions by Dublin’s Lord Mayor and a coalition of Teachtaí Dála (TDs), or Irish members of parliament. In November 2021, a motion was also brought before the Dáil calling for the government to ‘protect the not-for-profit and community-based ethos of employment services’ and to ‘suspend all plans to tender out employment services’ (Dáil Éireann, 2021). These campaigns ultimately came to no avail and on 23 December 2021 the DSP issued another request for tender for 17 additional Local Area Employment Services contracts on top of the four Regional Employment Services contracts already being procured. The results of that earlier tender were announced just weeks later, with Seetec and Turas Nua each winning contracts to deliver the new services in Longford/Westmeath and Laois/Offaly respectively.
The procurement of Local Area Employment Services was closely based on the DSP’s procurement of Regional Employment Services, being essentially the same programme in different counties. Price-bidding was actively encouraged, and outcome payments comprised a similar proportion (37 per cent) of the total possible payments per client. Despite this market governance approach and rumours that major multinational providers such as Maximus were preparing bids (Power, 2022), virtually all existing LES providers managed to win contracts to deliver the new Local Area Employment Services until mid-2025 (DSP, 2022a). For now, this component of Ireland’s mixed economy of activation remains largely in the hands of community sector providers. However, the award of parallel Regional Employment Services contracts to Seetec and Turas
Re-procurement of the JobPath programme also commenced in mid-2022 in the form of a request for tender to deliver new National Employment Service contracts. The payment model has been refined to focus on four different customer groups and different durations of job sustainment (17, 34, and 52 weeks). However, otherwise the programme represents a continuation of the JobPath model albeit at a smaller scale with contracts estimated to be worth €23.8 million per year compared to the approximately €50 million per year initially spent on JobPath (Lavelle and Callaghan, 2018). This reflects the decline in the numbers on jobseeker payments compared with when JobPath was introduced, and the proposed National Employment Service encompasses a very similar ‘grey-box’ design. Outcome payments also comprise 90 per cent of the total possible payments per participant that providers can earn (DSP, 2022b), reflecting a continuation of the DSP’s commitment to outcomes-based contracting.
By mid-October 2022, the results of the National Employment Service tender had yet to be made public. Although it would be surprising if Seetec and Turas Nua did not win the contracts given the request for tenders was issued only seven weeks before the tender deadline and two of the three contract lots mirrored the areas where Seetec delivered JobPath (Dublin; Connacht, Ulster, and North Leinster) while the third aligned with where Turas Nua delivered JobPath (Munster and South Leinster).
As evident from this overview, the use of market governance instruments to procure employment services and to govern the street-level delivery of welfare-to-work has evolved to become a cornerstone of welfare modernisation in Ireland. Initially this was through institutional layering whereby quasi-marketisation
The chapters that follow explore empirically how this turn towards marketisation reshapes the delivery of employment services in form and content, and the extent to which it has accelerated the workfarist turn in Irish social policy as part of a strategy of ‘double activation’. It is to this concept, and the underlying empirical research, that the book now turns.
