The independent think tank, the Social Market Foundation, has today published a critical analysis of the Payment by Results (PbR) element of the Government’s proposed reforms to the probation service.
The analysis, Paying For Results? Rethinking probation reform, underlines the long-standing view of the Probation Association and the Probation Chiefs Association that PbR on this scale is both too complicated and insufficiently piloted to form the basis of such rapid and large-scale reforms. We have argued for a phased introduction.
The report’s author, SMF Director Ian Mulheirn, a former economic advisor to HM Treasury, said that, while PbR made sense in principle, elements of the Ministry of Justice’s model would have the effect of turning incentives for providers upside-down.
The result, he said, would be strong perverse incentives that could leave providers who spent money on reducing reoffending worse off than if they had spent nothing at all.
Mr Mulheirn said: “The Ministry of Justice has effectively made it all but impossible for providers to achieve results good enough to get paid, without investors taking on impossibly high financial risks. The result will be that they simply won’t try.
“On these plans providers face incentives to cut frontline costs and allow reoffending rates to creep up. If they are implemented the scheme will reward failure and penalise success. Doing so would be setting the scheme up to fail for victims, taxpayers and offenders.”
In our formal response to the Transforming Rehabilitation consultation paper we said: “The PbR approach is not sufficiently tested in the criminal justice area to form the basis of such a radical change. Experience in other parts of government points to the complexity and difficulty of successful delivery of services organised in this way.”
We urged the Government to initially restrict PbR to contracts for services to offenders released from prison sentences of less than 12 months, to then develop PbR schemes for interventions and only expand PbR once solutions had been identified to the significant problems in contracting out probation business.