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Re-examining British welfare-to-work contracting using a transaction cost perspective

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Original languageEnglish
Pages (from-to)129-148
Number of pages20
JournalJournal of Social Policy
Volume46
Issue number1
Early online date18 May 2016
DOIs
Publication statusPublished - Jan 2017

Abstract

This article critically reflects on the administration of activation services in the UK. It describes the welfare-to-work quasi-market and focuses on the impact of 2008 commissioning reforms that advocated amalgamating small contracts into larger ‘lots’, creating a top tier of prime providers to manage subcontractors, and increasing outcome based funding. Drawing on transaction cost theory and empirical case study research it is demonstrated that these changes led to an increase in a range of activities and costs for competing service providers that undermine government rhetoric of choice and efficiency. This article adds to the existing literature on welfare-to-work contracting by demonstrating the difficulties some organisations face in the context of welfare markets and questioning public service out-sourcing processes. It concludes by reflecting on the implications for future market based social policy reforms.
Key words: welfare-to-work, third sector, quasi-market, case study, transaction cost theory, Great Britain

    Research areas

  • welfare-to-work, third sector, quasi-market, case study, transaction cost theory, Great Britain

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