Payment by Results
Nicky Robertson-Peek, 3SC
Steve White, VCS Assist
Payments By Results
The future e.g. Transforming Rehabilitation/WorkChoice/WP2
Market share shift
End loaded contracts
The Third Sector is traditionally better at providing bespoke
services and individual support that promotes sustainability
with so called “disadvantaged groups”
With the right platforms, processes and planning the Third
Sector will ALWAYS be better than the private sector at
delivering sustainability because they PUT THE CUSTOMER
Payment by Results Five Main
Areas we will cover:
Finance and Forecasting
Caseloading and RAG rating/Staff Resource
Quality and Compliance
Financing and Forecasting
Contract Profiles v performance
Delivery to meet Contract Compliance (not getting thrown out of supply
Level of Deficit against profiles
Delivery to meet organisational financial needs (more than contract
What is realistic to achieve?
Financing and Forecasting
Current Conversion Rates
Case loads too high? Too many staff?
Throwing money at problems and poor performance
Lack of accurate output forecasting for cash flow
Unable to return contract due to punitive penalties
Been put on performance improvement by Prime (Breach)
Solutions: Finance and
Cost/benefit analysis of overall contract value for next 6 months
Design Flight Path forecasting for each year.
Regular checks of unclaimed output opportunities
Cut out resource waste and duplication i.e. premises, staffing, resources
Exploit double funding opportunities i.e. with other partner courses with
Viability of Contracts through overall improved performance in all areas.
Caseloading and RAG rating
Most people can‟t RAG rate properly
Which effects everything from forecasting to assignment to wrong staff
Ineffective employer engagement
Distance from Labour Market
RED Amber Green
Profile of RAG Rated Clients
RED – extensive
overcome to enter
employment, lots of
low self confidence,
Basic Skills Training
AMBER - Need
Motivated, keen to
ready for interview
Operational RAG Rating
in the life of
Likely to find
Employment Advisor Profile:
• Empathy, compassion personal experience of related barriers
• Sales/target driven/bonuses
• Graduate – no experience in W2W
(articulate/good communication skills/creative)
–some organisations have made this their model for staffing
• Commercial recruitment background
• Older – diverse employment history
• Volunteers (how do we use them?/could be any of the above)
• Mentors - (how do we use them?/could be any of the above)
• Who does In-work support calls?
• Administrators (how are they used/ what are their skills?
• Any of the above?)
Division of case loads does not reflect staff skills
Lack of output targeting set for staff
Unrealistic panic targeting against staff skills
Culture shift and team dynamics
Problems with TUPE staff
Lack of Accountability of poor performers.
Lack of effective supervision
Solutions: Staff Personal Action
100% Buy-in by staff to the contract (collaborative Flight Path)
Effective Targeting. Do you have team targets or/and individual targets?
How are those targets communicated (competitions, team boards etc)
What sanctions are you prepared to impose on poor performance?
Solutions: Staff Resource
Perform team skills analysis and individual staff review
Examine Case Load and link to identified skills set
Set clear challenging realistic targets for all team members
Develop individual staff work plan and support through effective supervision.
Effect staff buy-in through accountability (wake up call)
Instigate regular staff performance meetings. (channelling what works)
Channelling whatever works with team dynamic
Put in place effective supervision structure with both rewards (incentives) and
consequences for non performance within the team dynamic
Break up cliques, of poor performers and effect proper inductions of TUPE staff.
Lack of dedicated member of staff
Lack of skills in sales and employer engagement
Wasting resource on unrealistic jobs opportunities
Lack of communication between advisors and employer
Lack of understanding of case load potential or limitations
Organisation working in isolation within local labour market.
Solutions: Employer Engagement
Identify or recruit most suitable member of staff to dedicated post.
Examine the caseload‟s skills and aspirations for unrealistic
expectations within local labour market
Partner with other organisations to maximise replicable vacancies
Working with other organisations fulfil employer vacancies
Regular team meetings to discuss employer engagement and
interventions re caseload
Essential investment in Employer Engagement Post or Training.
Lack of resource for contract
Pressure of short term performance targets affecting long term contractual
compliance resulting in job dropout etc through lack of proper job
Excessive pressure on staff to perform to meet short term gains.
Organisation at high financial risk due to poor performance
Performance slippage after short term bursts of crisis management of
Embed monitoring systems and tracking to ensure monthly targets are
Higher success will generate more income to meet resource demands.
Ongoing analysis of good practice and what works to evolve, up skill
and develop competencies to meet contract targets.
Effective forecasting to ensure long term goals and targets are met.
Proper support to staff to ensure development of skills and aid delivery.
Building up a network of suppliers, employers, complementary
agencies to ensure delivery of outputs.
Quality and Compliance
Contracts in breach due failing audits/quality/compliance
Over or under resourcing of quality systems to meet compliance
Lack of staff buy-in and commitment to contract quality issues
Huge risk in terms of illegality through fraud due to lack of internal
audits, and checks.
Solutions: Quality and Compliance
Designate a quality compliance champion within the organisation to
monitor and ensure contract quality and compliance standards are met.
Ensure that minimum quality standards are met and reduce administrative
burden on organisation.
Encourage staff peer auditing to reduce quality admin and encourage
good practice and time effectiveness.
Set minimum file reviews per month to ensure that files are all reviewed
ready for any contract audits.
Ensure staff buy-in by integrating into staff roles rather than it being seen as
Exercise 2 : Turning around a failing PBR contract
Exercise 2 :
Jobs-R-Us is a London-based charity with 22 staff members and a turn over of
£1.5m. They have a number of W2W contracts and have a successful track
record of delivering employability contracts for GLA, ESF, London Councils etc
to long term unemployed. They also deliver literacy, numeracy and ESOL
They are tier 2 end-to-end delivery provider on Work Programme and have
approx 800 customers. They initially started well and met all their targets for job
entries but for the last 6 months they have had erratic performance (sometimes
meeting in-month contract targets and then the next month being 60% below
profile). This has resulted in them becoming significantly behind profile and
having a deficit that is accumulating every month. The Prime has put them on
a 3 month Performance Improvement Plan (PIP) and the Board have raised
concerns about cashflow. The staff have been made away that they may
have to make redundancies if this continues and this has seriously impacted on
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