The government is clueless as to whether the almost £2bn Kickstart Scheme to boost youth employment through the pandemic was “worth the money” as it has little idea what was actually delivered, a damning new report has found.
Revelations from the Public Accounts Committee include an implementation period described as “chaotic”, that “little track was kept” of how the money spent was being used, and that applicants with higher education levels were more likely to be recommended for roles, doing little to address inequality in the jobs market.
Ultimately, the scheme failed to live up to its ambitions for “young people, employers, or taxpayers”, MPs concluded.
The Kickstart scheme, designed for under 25s who were claiming universal credit and at risk of long-term unemployment, was one of the government’s initiatives to “level up” the country after the pandemic.
However the “early delivery was chaotic” with the Department for Work and Pensions (DWP) “neglecting to put in place basic management information that would be expected for a multi-billion-pound grant programme,” reads the new committee report.
Asked why many young people who joined universal credit at the start of the pandemic have remained on the benefit rather than moving into Kickstart jobs, MPs found that the DWP simply “doesn’t know why.”
Comparing the Kickstart Scheme with the government’s Covid response schemes such as test and trace, chair of the committee Dame Meg Hillier said that both saw “little track kept of whether a scheme was delivering what it promises.”
“In this case the department simply has no idea whether this scheme was worth the money, not least because it has little idea what was delivered for it,” she continued.
The government paid 100 per cent of the national minimum wage plus national insurance and pension contributions for the duration of each six-month placement, with employers given £1,500 to spend on training per kickstarter.
But the DWP was found to also be in the dark on “what employers are providing with the £1,500 employability support grants they get for each young person they take on.”
Launched in September 2020, the Kickstart scheme was allocated a budget of up to £1.9 billion, with a target of supporting 250,000 participants.
But after 15 months of operation, there had only been around 100,000 Kickstart job starts, with the DWP predicting that a total of 168,000 young people will have taken part once the scheme ends. The project has used just £1.26 billion of the original budget.
The cross-party group of MPs are calling on the government to “ensure that it is able to, and does, claw back employment support costs where the employer has not used the money in line with its expectations”
The Committee also found that applicants with “higher levels of education were more likely to be referred to Kickstart jobs, and also more likely to be appointed to the job once referred.”
Although the DWP advertised the Kickstarter schemes through “ethnic radio stations and contextually-targeted digital advertising,” as well as targeting support to people from ethnic minority groups, the committee found that, ultimately, the scheme was not used to “tackle inequalities in the labour market.”
New figures released by the Office for National Statistics show little change in the number of young people aged 16 to 24 years who are not in education, employment or training (NEET) in October to December 2021 compared with July to September 2021, with the total estimated to be 692,000.
Around one in ten young people are currently unemployed and not in education, down less than a percentage compared to before the pandemic.
A government spokesperson told the Big Issue: “Kickstart has categorically delivered, giving more than 130,000 young people opportunities to work, earn and improve their prospects. It responded to extraordinary circumstances at unprecedented pace, as part of the wider Plan for Jobs which has defied forecasts of unemployment rising to 12 per cent – the headline rate is actually 4.1 per cent.
We will consider the (Public Accounts Committee) conclusions as we continue our mission to get people into work so they can take home more money.”
The scheme formally ended in December 2021, though some Kickstart employees have remained in their roles.
Urgent action is needed to prevent even more people being pushed into homelessness. A secure home is the first step in addressing the cruel cycle of poverty to ensure people can fulfil their potential. Join us to keep people in their homes.