More cash will be poured into a scheme for the unemployed despite doubts about its effectiveness at getting people into work.
Run by the Department for Work and Pensions (DWP), the Sector-based Work Academy Programme (SWAPs) aims to get people off benefits by combining training and work experience with an employer, followed by a job interview.
A new impact assessment estimates the SWAP scheme raises the chance of someone entering employment by 12.5 per cent.
It is the first time in five years the DWP has published a financial evaluation of the impact of the scheme, first launched in the 2010s and ramped up in 2020.
The internal DWP evaluation calculated that after taking part, participants earned £1,400 more than if they had remained on universal credit, working 90 days more and saving the taxpayer about £360.
SWAPs appeared to have the largest impact on older people and those on benefits for 13 to 24 months.
A cost-benefit analysis concluded the programme makes a return of £1.83 for every pound spent after two years, and that for society it makes a return of £5.66 on every pound spent.
Experts say the scheme is a necessary attempt at raising employment and lowering inactivity rates, but questioned whether the data suggests the scheme is a success.
‘An incomplete picture’
Imran Tahir, an economist at the Institute for Fiscal Studies, commended the DWP for publishing evidence on SWAP’s impact that “allows us to make more informed policy decisions.”
However, he said that while the research finds a positive impact on employment it also has “important limitations,” such as finding out what kind of jobs people are moving into.
Tahir added: “The jobs may be insecure and low-paid – this isn’t taken into account in the evaluation.
“In this sense, the report is an incomplete picture of the impact of SWAPs on employment outcomes.”
Between April 2021 and December 2024, about 350,000 people started SWAPs, with DWP statistics suggesting about two-thirds of starters completed their course.
Stephen Evans, chief executive of Learning and Work Institute, said SWAPs is a “successful programme” as the courses “increase the time people are in work and make a positive contribution to both the exchequer and society.”
Expanded scheme
The Labour government has decided to expand its targets for participation on the scheme from 80,000 people a year to 100,000, employment minister Alison McGovern announced last week.
This will include the rollout of a UKHospitality-led SWAP to “offer new opportunities in some of the country’s most deprived communities,” including 26 new areas and 13 coastal towns.
McGovern said: “The evidence is clear – SWAPs boost your earnings and keep you in your job for longer.
“That is why we are promising to deliver more of them than ever, as we Get Britain Working as part of our Plan for Change.”
The clear evidence?
The DWP’s evaluation methodology, known as “propensity-score matching,” compared people who did a SWAP with a larger group on universal credit with similar characteristics such as age, gender, household type, employment history and disabilities.
This allowed researchers to “estimate the counterfactual” of what would have happened if participants did not take part.
But this approach, the evaluation admits, does not take account of “unobservable” factors such as whether participants already wanted to move into work.
Despite this, Tahir said the positive impacts of SWAPs are encouraging, given the difficulty governments have in moving people on benefits into long-term employment.
‘Hardly a success’
Professor Alan Smithers, of the Centre for Education and Employment Research, said: “SWAP has certainly been something worth attempting to increase the unemployed’s chances of work.”
“But it can hardly be claimed to be a success when the Government’s evaluation shows it makes little difference to 87 per cent of those taking part.”
“The fundamental problem this government faces, as did those that went before, is how to better integrate education, training and employment, so that so many don’t fall by the wayside.”
A qualitative analysis of 93 interviews and focus group sessions in late 2022 found that while many participants tended to be “positive” about the programme, many doubted whether it was “useful.”
The research suggested that some participants were disappointed about a lack of work placements or job interviews and most were surprised to find the programme took “two weeks or less.”
The recent evaluation estimates that SWAPs in 2021-22 cost an average of £752 per person, with funding split between the DWP which leads on the scheme and the DfE, which funds the pre-employment training element from adult education budgets.
At this rate, 350,000 starts could have cost both departments up to £263 million.
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