Further Education and Training for the Unemployed

When the recession struck and unemployment surged, there were two principal providers each with its own set of programmes for assisting unemployed job-seekers to improve their employability by participating in further education or training.

68 An Irish Tourist Industry Report, for example, identified similar issues preventing employers in its industry from taking the high-skills route – high staff turnover and exit rates from the industry, disruptions to business while employees are on training, the financial costs involved for SMEs, and dissatisfaction with current training programmes (ITIC, 2006: 28).

FÁS, while it also had major responsibilities for training people in employment, persons with disabilities and apprentices, operated a suite of programmes for training unemployed people. While unemployed people could voluntarily apply for places on these programmes, being referred to them from the LR after contact with FÁS Employment Services under the National Employment Action Plan had become an increasingly important route by which places were filled. Up until 2010, all unemployed people who participated on FÁS training courses were eligible for receipt of the FÁS Standard Training Allowance equivalent to the standard rate of payment for Jobseeker’s Benefit and Jobseeker’s Allowance. Since 2010, only unemployed people with an underlying entitlement to JB or JA receive the Training Allowance. As Chapter 2 made clear, FÁS training programmes for the unemployed have been under particular pressure since the recession began to expand their capacity, retain and even improve their quality, and demonstrate flexibility and responsiveness in meeting the needs of the new unemployed.

Similar but, perhaps, not such intense pressures have come on Vocational Educational Committees during the recession to increase the participation of unemployed people in the full-time and part-time programmes they operate. Their further- education objectives are not specifically linked to dealing with unemployment but are intimately linked to the factors that increase its risk for many people. Further education, as the VECs pursue it, is to provide second-chance education generally for people who do not complete upper-secondary level and meet the specific needs of early school-leavers, while also providing vocational preparation and training for labour market entrants and re-entrants (this latter potentially embracing all the unemployed). All unemployed jobseekers who participate in FET do so voluntarily. Whether or not they receive income support while on a programme, have their fees and tuition paid, get support with childcare or are entirely self-financing, depends on their circumstances and their eligibility for different forms of support (e.g., the Back to Education Allowance, Vocational Training Opportunities Scheme, Back to Education Initiative, etc.). Financial support provisions for participants in FET have also been impacted by fiscal constraints (for example, the new €200 annual

contribution from participants on Post-Leaving Certificate programmes introduced in Budget 2011).

As outlined in Chapter 2, a major response to the labour market crisis to date has been an institutional reconfiguration, which has seen responsibility for all FÁS training (that for the unemployed included) being transferred to the Department of Education and Skills. The two parallel sets of programmes in place as the recession began, delivered through two different structures that were the responsibilities of separate government departments, are, henceforth, to be the responsibility of the one department. The DES is seizing the opportunity to integrate education and training under a new agency, SOLAS, to bring a new coherence, effectiveness and status to further education and training, making it a constitutive pillar of the Irish educational system. It is envisaged that, in time, VECs– after mergers to produce a smaller number that are more strongly equipped and managed, and after absorbing FÁS training centres and regional staff – will have the ultimate responsibility for

which unemployed people can improve their employability. It is also intended that VECs should be an integral part of activation strategies and that referrals from the DSP’s new National Employment and Entitlement Services will be made to all the programmes for which VECs have responsibility.

Table 1.4 provides a summary of the principal ‘raw material’ or building blocks that the DES has to hand as it seeks to provide unemployed jobseekers with a more seamless, efficient and effective service in improving their labour market skills and competences (a brief primer on each programme is provided in Appendix 4.1). Allowing for the smaller programmes not included in the table, in broad terms, some 87,400 training interventions are being provided for unemployed people by FÁS in 2011 using a total budget of about €228m, and about 170,000 places on

further education and training courses by VECs and others out of a total budget of over €400m.69 (Note that these totals for training interventions and places

respectively aggregate programme participations of very different durations and intensities.)

In framing assessments, and more importantly expectations, of the level and quality of the the services unemployed jobseekers receive from FÁS and the VECs at the current time, the human resource situations of the providers must be factored in. FÁS staff numbers have been reduced by 19 per cent overall between 2008 and 2011 and the number providing training services is to fall further from 1,162 in 2011 to 1,024 in 2014 under the Employment Control Framework (ECF); the latter’s freeze on renewing temporary contracts or replacing staff who retire or leave is impacting strongly on the capacity of VECs also. Qualitatively, major restructuring and redeployment is not always being experienced positively by staff (particularly in FÁS, and with the impact of substantial mergers between VECs still unclear) and, consequently, productivity and service improvements can lag behind institutional and operational changes.

Training Budget €m Interventions/ Places FÁS Programmes*

Specific Skills Training** 58.7 20,900

– (Long) 38.0 11,000

– (Short) 20.7 9,900

Community Training Centres 45.5 3,100 Local Training Initiatives 36.2 3,600

Traineeships 32.2 5,100 Bridging 13.2 4,000 Redundant Apprentices 8.1 1,100 Evening Courses 6.2 21,500 TESG 6.0 9,200 VEC Programmes**** Full-time PLCs***** 186.0*** 31,688 VTOS 80.0 5,000 Youthreach 67.0 3,688 Part-time Adult Literacy 30.0 49,000 BTEI****** 17.0 28,000 Community Education 10.0 50,000

Table4.1

Principal Further Education and Training

Measures for the Unemployed, 2011

Source DES

Notes * Only FÁS training programmes for the general unemployed are included (thus, not training for people in employment, nor apprenticeships, nor training that is specific to persons with disabilities). Also, only programmes with 2011 budgets of €6m

or higher are included.

** Not including the 6,000 extra places announced in the May 2011 Jobs Initiative (1,000 long; 5,000 short).

*** Assuming overall expenditure is similar to 2010.

**** Senior Traveller Training Centres (2011 budget of €21m for 684 places) are not included as they are being phased out

and provision for Travellers over eighteen years of age is being integrated into more mainstream programmes.

***** Not including an additional 1,000 places announced in the May 2011 Jobs Initiative.

A major weakness that has challenged, and continues to challenge, the effort to use resources to maximum effect and procure the best possible FET outcomes for unemployed people is the underdeveloped evidence base in Ireland for determining what works best and for whom.

Different types and levels of evaluation of FET programmes have been carried out in Ireland but few have employed what, by contemporary standards, would be regarded as methods that unambiguously establish programme-specific effects. There have been several overviews of the full range of programmes available in Ireland (e.g., Forfás, 2010b; Grubb et al. 2009; NESF, 2006; O’Connell, 2001; Indecon, 2002), a large number of individual programme reviews conducted by consultants for the public sector (e.g.,Eustace & Clarke, 2006, on the LDSIP; Indecon, 2005, on the NEAP; Fitzpatrick Associates, 2003, on the PES; Deloitte & Touche, 1998, on CE; etc.) or as part of value for money reviews within the public sector (e.g., DES, 2008, on Youthreach; DETE, 2005, on supports for the LTU; DSFA, 2005, on BTEA; etc) and a wide range of once-off studies examining one or several programmes from a specific view point (e.g., the Equality Authority, 2003, on Travellers’ experiences; the National Disability Authority, 2003, on accessibility for persons with disabilities; the NESF, 2003, on issues for older workers, etc).

Some early lessons emerged, such as that training programmes demonstrably linked to what employers need and expect of potential employees (and, frequently, with employer participation), other things being equal, procure better transitions to employment than training programmes with weak or no links to employerw (a conclusion, much cited, to which, nevertheless, a degree of the obvious attaches). The reviews of individual programmes conducted for – or within – the public sector tended, as with expenditure reviews generally, tended to provide clear descriptions of programmes’ origins, their development and levels of inputs and outputs, but seldom to ascertain the net difference programmes were making to outcomes over and above clear counterfactuals, and at what cost.

Where attempts have been made to compare what specific FET programmes achieve for participants over and above what would have happened anyway, the tentative conclusions are not impressive. Forfás (2010b), for example, sought to compare programme outcomes for participants with what happened to people on the LR similar to participants in all key respects except that they did not participate in the programme in question. Significant variation was found, from significant effects for small programmes such as Traineeships (outcomes eighteen percentage points higher than for a similar group on the LR) and Local Training Initiatives (thirteen percentage-point better outcomes) to modest effects for major programmes (Specific Skills Training making a five percentage-point difference) and nil effects for others (the Bridging Foundation programme, Community Training Centres, etc.). A recent evaluation of the NEAP has used, by Irish standards, an advanced methodology only to establish a clear negative impact of the programme on participants’ outcomes (McGuiness et al. 2011, discussed in Chapter 7).

4.4 Funding the Individual and not the Provider

Two specific instruments merit close examination for their potential to improve access to, and outcomes from, training and education for unemployed jobseekers – training vouchers and individual learning accounts (ILAs). Since the late 1990s, the majority of EU states have experimented with one or the other in an attempt to better incentivise both employees and the unemployed to invest in upgrading their knowledge, skills and competencies as part of an overall emphasis on lifelong learning (Cedefop, 2009; De Grier, 2008). In general, a voucher-based approach involves the state providing a direct subsidy to individuals to help defray the costs of their training or education, while ILAs can receive contributions from several actors (the state, individuals, employers) that are then pooled to enable individual to purchase education or training (Cedefop, 2009).

While nominally different, the distinction between these policies instruments is blurred in practice (Dohmen, 2009). Importantly, both approaches are underpinned by the same fundamental principle, namely that ‘public money should follow consumers rather than suppliers’. In the context of active labour market policy, this involves a shift from the state providing Exchequer resources to providers (public, private and not-for-profit) who then offer courses to unemployed individuals and to a situation in which public funding is channelled directly to unemployed individuals who then utilise their purchasing power to select a course from a range of potential providers. It is anticipated that such a shift should further a number of beneficial outcomes, principally:

s A greater sense of personal empowerment that increases an individual’s interest

and motivation in training and education;

s A better alignment between training provision and individual needs in a manner

that enhances an individual’s future employability;

s Increased competition in the supply of education and training provision with,

consequently, the development of more innovative, flexible and customer- focused services; and

s Greater efficiencies in the deployment of state resources.

Training vouchers are still a relatively new instrument within active labour market policies and the literature suggests their success to date has been limited (De Gier, 2008, 2009). In many instances, the same challenges that face training systems based on the direct funding of providers – namely, deadweight, displacement, substitution and cherry-picking – are seen to also be capable of undermining the effectiveness of voucher-based training initiatives. For example, information asymmetries in Germany contributed to lower levels of participation by the long- term unemployed and low-skilled in voucher-based training, and undermined their objective of improving client choice (ibid.). A lack of universal quality information meant, in effect, that ‘equality of purchasing power did not lead to equality of access’. There was also no tangible evidence that the shift to funding the learner generated an increased diversity of providers. In the USA, the long-term unemployed also had

there was even a significant decrease in the demand for places on training courses for the long-term unemployed.

Comparative research on the impact of ILAs similarly points to mixed results (Cedefop, 2009; CES, 2010). On the one hand, evidence suggests that significant numbers of individuals would not have participated in training without the support of an ILA, pointing to a mobilising effect (Dohmen, 2009). On the other hand, the evidence also suggests that reaching certain disadvantaged groups remains difficult unless further specific targeting measures are adopted (ibid.).

IndividualReintegrationAgreements

It has to be acknowledged that evidence for the increased efficacy and efficiency of training vouchers or ILAs is currently sparse, and that specific difficulties arise in using them for the more disadvantaged groupings within the labour market. This does not mean that the intuition that public funds for FET should, to the greatest extent possible, follow the individual and not the provider, and involve individuals themselves in choosing the provider and course they use, is not sound and worth pursuing. The Dutch have had some success with the application of this intuition, too, in the particular field of pathways from welfare to work or activation strategies. In the Netherlands, Individual Reintegration Agreements (IROs) (see Box 4.3) are agreements that allow individuals, in conjunction with competent and independent advisors, choose which providers and programmes receive public funds on their behalf to help them. They are considered to have improved outcomes for clients and to have led to the adoption of a more client-focused service by private providers. It should be noted, however, that the Dutch IROs are primarily for the insured unemployed, that is, individuals who were relatively recently in work and have a better educational profile than the long-term unemployed.

Box4.3

Individual Reintegration Agreements (IROs)

Since the year 2000, reforms to labour market policy institutions in the Netherlands have delivered a quasi-privatised market for the provision of activation (reintegration) services to unemployed job-seekers (Finn, 2008; Lindsay and McQuaid, 2009; Sol et al., 2008). Initially, the shift to a tender- based system was expected to yield more flexible and client-focused services. Instead, a convergence towards standardised approaches was noted as private reintegration agencies strove to minimise costs. As complaints from clients regarding the quality of these services grew, forceful lobbying by the National Client Council (LCR) — a statutory body established to represent the view of clients to the Minister — resulted in the UWV70 _{introducing Individual Reintegration Agreements (IROs) and}

establishing a network of independent advisers to support this new initiative.

IROs enable eligible individuals – those entitled to unemployment insurance benefits or who are partially disabled – to negotiate an individual reintegration (activation) agreement with a private reintegration agency of their choosing. In making their selection, the service user can access advice on available providers from both a UWV reintegration coach and an independent adviser, who has no role in the decisions about the final plan or about the benefits. Once a private agency is selected, they first work directly with the client to draw up an agreed reintegration trajectory and attendant set of steps. This joint plan is then reviewed by a coach from the UWV and, if accepted, a performance- based contract is signed between the benefit agency and the private provider.71 _{An IRO trajectory can}

last for up to two years and the normal maximum price is €5,000.72

IROs have proven popular with unemployed jobseekers and they now account for approximately 60 per cent of the trajectories agreed by the UWV (Sol et al. 2008).73 _{IROs have provided clients with}

a greater sense of ownership and choice in relation to activation services and supports, as they are now active participants in the design and delivery of their ‘individualised’ reintegration plans. These personalised trajectories enable clients to more effectively utilise their ‘rights’, better understand their obligations (ibid. 2008) and, thus, appear to represent a deepening of the mutual obligations approach in Dutch activation policy. They have also encouraged more openness and creativity on the part of clients and providers, helping to overcome what had previously been diagnosed as a lack of flexibility and innovation in service provision. They have stimulated providers to pay more attention to ‘client needs’ than was evident in the tender-based system (De Grier, 2008) and more ‘tailored’ services to clients have resulted. Initial evaluations of IROs, therefore, have been positive and demonstrate that, for unemployment benefit and disability benefit recipients, they perform better than employment services delivered by the contracted-out tender-based system (ibid.) . In particular, IROs appear to have had a positive impact on job entry and job retention; in a country where a degree of ambiguity is acknowledged with regards to the overall impact of activation strategies, IROs are considered to have clearly contributed to getting people back to work (Lindsay and McQuaid, 2009). In summary, IROs are a good example of how a combination of client voice, user involvement and practical support for individual choice can generate innovation and service improvements that generate benefits for the state and unemployed jobseekers. They underline, however, that implementing a genuinely client-driven approach requires developing the appropriate set of institutional supports that can assist individuals in making informed, personal choices.

70 The Administrative Agency that is responsible for the administration of contributions-based benefits.

71 The contract offers a ‘no cure, less pay’ funding formula under which the private agency is paid 20 per cent at the start of the plan, 30 per cent after six months’ participation and the remaining 50 per cent only if the participant enters sustained employment.

72 For users who face more significant barriers to employment the price of the trajectory may be up to €7,500 and in exceptional circumstances the

UVW may increase this limit.

73 They have also stimulated an influx of much smaller providers as the number of companies with which the UVW has contracts increased rapidly from less than 100 to 2,400 between 2003 and 2007.

assumed to be associated with increasing individual choice, a strong policy interest remains in models premised on funding the individual and not the provider (Cedefop, 2009; CES, 2010). This interest also surfaced in Ireland in recent years74

and was encouraged by the positive experience with the pilot Customised Training Fund (CTF) for unemployed people (Fox, 2009a). The CTF was designed to give FÁS ESOs greater flexibility in responding to the specific training needs of caseload clients by allowing them to purchase specialised training needs that could not