Unemployment scheme is outsourced to private firms

The Government has chosen the preferred operators for its first nationwide scheme to tackle long-term unemployment.

Its JobPath initiative is being controversially outsourced to the private sector on a payment by results basis.

The Department of Social Protection selected British recruitment firm Seetec and a consortium known as Turas Nua, comprising Irish recruiter FRS and UK company Working Links, to run the programme.

The scheme, expected to be operational early next year, targets the 178,000 people classified as long-term jobless – out of work for more than a year.

JobPath will be performance based, meaning operators will be paid if they secure sustainable employment for people. To ensure people obtain full-time jobs the department will stagger payments to providers.

Seetec, which operates a similar programme for the British government, has been earmarked to run the scheme in the northern part of the country and Dublin, while it will be Turas Nua in the south.

Unions critical

The financial terms of the deal have not been disclosed, but the winning bidders are understood to have beaten off several high-profile rivals.

In Britain, welfare-to-work providers can earn between £4,000 (€5,000) and £14,000 for getting long-term benefit claimants back to work.

The Government’s move has been criticised by trade unions. They claim the payment by results model will fall victim to “creaming and parking”, with providers cherry picking those most likely to find employment while offering little assistance to the hard cases.

This criticism has been levelled at the British government’s work programme which was outsourced to several private sector companies, including Seetec, in 2011.

The department says, however, it does not have the manpower to operate the scheme.

Despite being in office for more than three years, JobPath is the Coalition’s first national initiative solely dedicated to tackling long-term joblessness.

Its existing programmes, which employ more than 60,000, have been criticised as overly focused on young and inexperienced workers.

Breda O'Brien of the Irish National Union of the Unemployed said the service must get people into sustainable work.