Providing welfare - invitation to the private sector

The Governments looks set to ask private companies and charities to help run the welfare state, the Telegraph reports today.

"[In a speech this evening] James Purnell, the Work and Pensions Secretary, will call on firms to help overhaul the payment of benefits" ... encouraging them to "bid to run everything from welfare-to-work schemes to projects to rehabilitate former prisoners."

This 'open invitation' follows Tory suggestions earlier in the year that private companies might play a bigger role in finding jobs for the unemployed. Such schemes in America have proved relatively successful, offering job seekers a more refined service and saving taxpayers millions of dollars. Critically, the numbers returning to welfare after their first year back in work has dropped significantly.

While initially wary of such moves, the ineffectiveness of government reforms have forced Labour to reconsider. Any move towards better services, a smaller state and lower taxes is of course welcome, but as is often the case with potentially positive proposals from this government (proposals albeit often co-opted from their opponents), the end result will no doubt be half-baked, a hollowed out compromise between Labour's pragmatic reformist wing and its old guard. Another missed opportunity.

That the Secretary of State is even considering it though is a welcome development, an indication that even Government now recognises that better government is only possible if there is less government.