Financial Times FT.com

Welfare reform under scrutiny

By Alex Barker and Nicholas Timmins

Published: January 29 2009 23:31 | Last updated: January 29 2009 23:31

A flagship £1bn government programme to find jobs for people on sickness benefit is running 73 per cent short of its target, an unexpectedly bad outcome that will test political consensus about expanding private welfare provision.

The poor performance data, measured before the big increase in unemployment caused by the recession, has wide implications for direction of welfare reform, the price of existing contracts and the terms of future negotiations with private providers.

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