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Employment Assistance cost-effectiveness report - 2016/2017

Each year MSD summarises its evidence on the cost-effectiveness of its expenditure on employment assistance (EA) programmes and services and case management (CM) services. The results are used by MSD to inform its decisions on design and funding of employment programmes and uses.

Developed annually since 2011, the current report updates this series to the end of 2016/2017. The research and evaluation team has taken the opportunity in this report to improve its approach to this analysis.

The analysis presented in the current report differs in several ways from previous EA effectiveness reports. For example, in this report, MSD divides the results between discrete EA interventions (e.g. wage subsidies, job placement and training programmes) and CM services (i.e. assigning people to a specific case-management service); included the impact of EA interventions on education achievement, and justice outcomes; switched to reporting intervention effectiveness ratings by financial year rather than as an overall average.

MSD now assesses the effectiveness of interventions against multiple outcomes, while it previously assessed effectiveness on a more limited set of outcomes (primarily independence of welfare). It also now reports the effectiveness of EA interventions separately for each participation year, rather than an average effectiveness rating over all the years the intervention operated. This allows the Ministry to track whether the performance of individual interventions is changing over time (i.e. is an intervention more or less effective for people who have participated in more recent years).

Key Findings – Employment Assistance

  • Of evaluated expenditure ($206 million), $149 million (72%) went on effective or promising employment assistance, $32 million (16%) went on EA interventions with mixed effectiveness, and $25 million (12%) went on interventions that either made no difference or had a negative effect.

Effective/Promising ($149 million)

Effective and promising EA interventions have overall positive impacts across one or more of the five main outcome domains.

  • Job placement interventions: these include vacancy placement both in-house and contracted out hiring subsidies and training for pre-determined employment.
  • Work obligation focused interventions: interventions that use work obligation requirements to ensure people are actively seeking employment.
  • Short-term training courses: for people who are likely to be on main benefit long term.
  • Contracted-out case management.
  • Limited Services Volunteer.
  • Training Incentive Allowance.

Mixed ($32 million)

The overall effectiveness of Vocational Services Employment ($31 million) has improved over the last 11 years, with participants showing positive impacts on both overall income and time in employment.

No difference ($9 million)

For interventions that have small overall effects, we cannot always identify whether these effects are statistically significant or not. In some instances, this may mean the intervention is still useful, but current methods are not able to identify its impact.

Negative ($16 million)

This year Youth Service – NEET (Not in Education, Employment or Training), was the only intervention given a Negative effectiveness rating. Service Delivery is working on changes to the targeting and design of the Youth Service (NEET) to improve its effectiveness.

Key Findings – Case Management (CM) services:

  • From July 2013 people receiving income support assistance are allocated to specific CM services.
  • Some people on income support receive more intensive case management, and some case managers specialise in working with certain groups such as those with a health condition or disability.
  • Within each service, case managers are responsible for maintaining people’s income support entitlements as well as helping them move into employment.
  • In 2016/2017, case management cost $279 million, $202 million of that on Intensive Case Management.
  • (GCM, $77 million) is the default CM service people are assigned to and is the service which the more intensive CM services are compared against, where possible. For this reason, we cannot give GCM a specific effectiveness rating.
  • The Intensive Case Management services were all found to be effective in reducing the time participants spent on main benefit relative to General Case Management

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Cost-effectiveness of MSD employment assistance - Summary report for 2016/2017

Feb 2019

Cost-effectiveness of MSD employment assistance – Technical report for 2016/17

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