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Re-examining British Welfare-to-Work Contracting using a Transaction Cost Perspective

Published online by Cambridge University Press:  18 May 2016

HAYLEY BENNETT
HAYLEY BENNETT*
Affiliation:
Politics and IR, University of Edinburgh, 4.02, 4f1, 18 Buccleuch Place, Edinburgh EH8 9LN, Scotland. email: Hayley.Bennett@ed.ac.uk
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Abstract

This article critically reflects on the administration of activation services in the UK. It describes the welfare-to-work quasi-market and focuses on the impact of 2008 commissioning reforms that advocated amalgamating small contracts into larger ‘lots’, creating a top tier of prime providers to manage subcontractors, and increasing outcome-based funding. Drawing on transaction cost theory and empirical case study research, it is demonstrated that these changes led to an increase in a range of activities and costs for competing service providers that undermine government rhetoric of choice and efficiency. This article adds to the existing literature on welfare-to-work contracting by demonstrating the difficulties some organisations face in the context of welfare markets and questioning public service out-sourcing processes. It concludes by reflecting on the implications for future market-based social policy reforms.

Type
Articles
Information
Journal of Social Policy , Volume 46 , Issue 1 , January 2017 , pp. 129 - 148
Copyright
Copyright © Cambridge University Press 2016 

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