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Private firms to find people work Private firms to find people work
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The government is to offer private firms and voluntary groups cash rewards to get unemployed people into work. Private firms and voluntary groups are to be offered cash incentives to get unemployed people into work for longer.
The plans will involve about 250,000 long-term unemployed people and all new claimants for sickness benefits. The changes will affect about 250,000 long-term unemployed people and all new claimants for sickness benefits.
Cabinet minister James Purnell said a "radical blueprint" was needed to get people into "sustainable" jobs.Cabinet minister James Purnell said a "radical blueprint" was needed to get people into "sustainable" jobs.
Meanwhile an MPs' committee reports that 40% of jobseekers' allowance claimants who find a job are out of work again within six months. Meanwhile an MPs' committee has found that 40% of jobseekers allowance claimants who find a job are out of work again within six months.
The public accounts committee concludes: "Despite high employment levels many people cycle between work and benefits". The public accounts committee concludes: "Despite high employment levels many people cycle between work and benefits."
Work and Pensions Secretary Mr Purnell will unveil plans later for a "commissioning strategy", that will see more private companies and voluntary groups involved in finding work for people on benefits - following a review by investment banker David Freud. Longer contracts
'Innovative solutions' Work and Pensions Secretary Mr Purnell has announced a "commissioning strategy" that will see more private companies and voluntary groups involved in finding work for people on benefits - following a review by investment banker David Freud.
New contractors are expected to be offered incentives for getting people into work for at least six months, with further incentives planned in the future for increasing it to 18 months.New contractors are expected to be offered incentives for getting people into work for at least six months, with further incentives planned in the future for increasing it to 18 months.
In return, they will get larger contracts which last up to seven years - twice as long as usual.In return, they will get larger contracts which last up to seven years - twice as long as usual.
The public accounts committee report also criticised the fact the government had considered 13 weeks a "yardstick" for sustained employment, saying it was "too short".
Gordon Brown is tinkering around the edges - a bit of reform here, a bit of participation by the private sector, a slight toughening of sanctions Chris GraylingConservativesGordon Brown is tinkering around the edges - a bit of reform here, a bit of participation by the private sector, a slight toughening of sanctions Chris GraylingConservatives
Mr Purnell will tell a conference he wants to free benefit services from central control and allow them to generate "innovative solutions".
Among the suggestions in the review carried out by Mr Freud almost a year ago was that of the 2.7 million people claiming incapacity benefit, only 700,000 need it.
Lone parents are also expected to face tougher requirements to find jobs or lose benefits.
'Real success'
Mr Purnell said there was a "big challenge" adding: "We have got really radical goals, getting one million off incapacity benefit, we need a radical blueprint to achieve it."Mr Purnell said there was a "big challenge" adding: "We have got really radical goals, getting one million off incapacity benefit, we need a radical blueprint to achieve it."
He told BBC 2's Newsnight: "We've had a big improvement in terms of getting the unemployment level down; now we need to get the inactivity level down."He told BBC 2's Newsnight: "We've had a big improvement in terms of getting the unemployment level down; now we need to get the inactivity level down."
He added: "We've had three million new jobs under this government. That is not a culture of dependency, that's a real success in terms of full employment."He added: "We've had three million new jobs under this government. That is not a culture of dependency, that's a real success in terms of full employment."
Mr Freud says most claimants should be looking for work 'Economically rational'
Incapacity benefit costs the Treasury about £12bn a year. But the Department for Work and Pensions said recently the number of claimants was at its lowest since 2000.Incapacity benefit costs the Treasury about £12bn a year. But the Department for Work and Pensions said recently the number of claimants was at its lowest since 2000.
Mr Freud has previously said it would be "economically rational" to pay as much as £62,000 to a company which managed to place an incapacity benefit claimant in a job which lasted three years or more. Mr Freud has said that of the 2.7 million people claiming incapacity benefit, only 700,000 need it.
The public accounts committee report also criticised the fact the government had considered 13 weeks a "yardstick" for sustained employment, saying it was "too short". Mr Freud says most claimants should be looking for work
He estimates it would be "economically rational" to pay up to £62,000 to a company which placed an incapacity benefit claimant in a job for at least three years.
Of the government's latest plans, shadow work and pensions secretary Chris Grayling said the government was trying to "steal Conservative language on welfare reform".Of the government's latest plans, shadow work and pensions secretary Chris Grayling said the government was trying to "steal Conservative language on welfare reform".
"We've set out very clear and very detailed plans for welfare reform based on the experience in other countries, a very full package," he said."We've set out very clear and very detailed plans for welfare reform based on the experience in other countries, a very full package," he said.
"Gordon Brown is tinkering around the edges - a bit of reform here, a bit of participation by the private sector, a slight toughening of sanctions. Nothing like the scale of radical change we would need.""Gordon Brown is tinkering around the edges - a bit of reform here, a bit of participation by the private sector, a slight toughening of sanctions. Nothing like the scale of radical change we would need."
The Liberal Democrats have previously welcomed the use of the voluntary and private sector to help more people back into employment, but said it must be "properly financed, and include provisions to help those with serious problems such as low skills or mental health problems".The Liberal Democrats have previously welcomed the use of the voluntary and private sector to help more people back into employment, but said it must be "properly financed, and include provisions to help those with serious problems such as low skills or mental health problems".
But unions have raised concerns that contracting out services will lead to job cuts and "lower standards and the exploitation of claimants".But unions have raised concerns that contracting out services will lead to job cuts and "lower standards and the exploitation of claimants".