Multi-level governance and employment policy

Transcription

1 Multi-level governance and employment policy Background paper for the session on employment policy at the Multilevel Governance Conference - 2 December Liège Ludo Struyven (HIVA, Leuven University) Old and new governance The government and governance of labour market and employment policy have undergone significant changes since the 1980s. In most countries, the social welfare model developed during the first decades after the Second World War brought with it a system of labour relations in which other actors were involved (horizontal dimension of multi-level governance). Traditionally, these actors were the social partners and the municipalities. In some countries, such as Belgium, Germany, and France, this led to joint policy negotiation and administration of the representative employee and employers organisations (tripartite coordination; joint management). In other countries, such as The Netherlands and Scandinavia, local authorities were traditionally given greater influence in the field of employment and training services. Many countries afforded a greater role to the non-commercial players, known as third parties, in the implementation of labour market policies. The third parties often consist of organisations in the social welfare sector or in the area of local community-building. These are often non-governmental, local organisations which specialised in the reintegration of high-risk groups. More recently, there was the rise of private job brokerage services in the wake of the deregulation of public arrangements in the employment and income system, leading to the ending of the government monopoly in public job brokerage under the Convention of the ILO on Private Employment Agencies. In several countries, this led to the introduction of contracting-out publicly paid services which were previously implemented by public offices to the private sector, following a quasi-market model, in which profit, notfor-profit and sometimes also public providers compete for the provision of employment and reintegration services. Employment policy and service delivery have never been the sole responsibility of the national or regional state and their associated Public Employment Service (PES). In this respect, one could say that the shift from government to governance was in itself not new.

2 Four shifts in governance of employment policies New are the major restructuring processes of the institutional structure for the administration of unemployment insurance systems and employment services. These processes can be summarised into four movements: 1) social partners taking a step back from involvement in the administration, in order to restore the minister s authority ( primacy of politics ) 2) the steering of public services by performance contracts ( agentification ), following New Public Management principles (Struyven and Verhoest, 2005) 3) the establishment of local job centres, based on local embeddedness, typically at the level of a single municipality or a group of municipalities, and based upon a new logic of governance through networks of PES, local government, NGOs and other actors (Struyven and Van Hemel, 2009) 4) the introduction of contracting-out significant parts of public service delivery to private employment agencies (Struyven and Steurs, 2005). However, it is not really possible to talk about a convergence of employment policies and services, as varying national political, institutional and cultural contexts made the starting points very different, just as the national policies chosen are different (Barbier, 2004). Not only the mix and extent of the reforms differ, but also what is finally attained. Radical examples of institutional reforms all point to changes in the multi-actor governance structure. The first movement led up in some countries in a way to de-corporatisation (The Netherlands, Denmark, Germany). In so doing, this brought the collapse of one of the foundations of the corporatist model for the structure of employment services. The second trend resulted in countries such as UK, France and The Netherlands into a single agency, in which the previous existing benefits agency and the public employment agency were merged. The third development has led in Denmark and Germany to a form of political decentralisation, called municipalisation, by giving local authorities full responsibility for placement and active programmes as well as for benefit administration. The fourth development led in some countries (Australia, The Netherlands) to an abrupt transition for the remaining PES. All these changes take place against the background of the bigger project of developing an active welfare state, shifting from protection to participation. This is the so-called activation paradigm. Employment agencies, whether public or not, acquired an ever greater role in the delivery of active programmes (job search, training, social employment) and provisions (information and guidance of jobseekers and employers). In many countries, the activation also affects the unemployed on social assistance. These forms of minimum income benefits are traditionally provided in a separate delivery system under the responsibility of the local authorities. The local social welfare agencies within the municipalities tend to co-operate with the PES. When unemployment insurance benefits are being restricted in time, and local authorities are gaining full responsibility for social assistance (e.g. The Netherlands), there are specific triggers for more intense collaboration and joint administration.

3 3 European guidelines and local policy levels The literature of multi-level governance refers primarily to the open method of coordination (OMC), first introduced in the Employment Strategy of the Amsterdam Treaty in the context of the European integration (vertical dimension). Basically the employment strategy consists of a continuous benchmarking of national and regional policies against European guidelines. These guidelines have to be translated into specific targets for national and regional policies. The whole process is accompanied by periodic monitoring, evaluation and peer review under the auspices of the European Commission. In many member states, the performance targets stipulated in the PES contract, are fully in line with the European guidelines. In federal states with a considerable devolution of responsibilities to regional or state governments, there is an internal vertical co-ordination between the federal and regional or state level. Local governments and actors at a subregional level (i.e. level of a labour market region) are not involved in the co-ordination process. This implies that for the local actors there is no direct urge to subscribe to targets which have been defined at the European level. This confirms the image of a relatively closed OMC process involving in particular national administrators, and not involving sufficiently all decentralised stakeholders and civil society actors. As a consequence, the PES is more fixed on performance targets at a central level. The central aim for Europe is to reduce the period during which people are dependent on unemployment insurance, the so-called preventive approach. The reasoning is that the earlier the jobseeker is activated and supported, the greater the chance of preventing long-term unemployment. Hence, the central political aim for the PES is the systematic invitation and intake of all newly registered jobseekers. These targets put great pressure on the implementation, because a considerably greater volume of clients have to be activated. Business models and management systems, supported by strong IT-systems, are used to standardise processes and increase management control over resource allocation in local service offices. When targets are centrally set and defined in terms of labour market groups, this reduces the amount of local policy discretion. The local PES office is told what to do rather than which labour market goals are to be achieved (Mosley, 2009). Policy flexibility as a key success factor As stated above, the governance regime at a central level is highly characterised by the performance management model. The solution does not appear to lie in writing off the performance management, or in boarding up such NPM instruments entirely. An increase in the reflexivity of the central governance regime concerned would offer a better solution. As Considine has argued, Organisation-wide contracts appear to be a necessary, but not sufficient condition for service improvement. These must be broken down into flexible, local and regional arrangements to avoid target harshness (Considine, 2000). This argument in favour of reflexive governance allows more scope for continual adjustment, consultation and innovation in implementing employment policies, and it is less fixed on performance targets at a central level. One option would imply that the performance management would be far more embedded in a relationship of trust with the government. An additional option is to allow more scope for local differentiation and bottom-up approach by the local PES

4 offices. By strengthening the horizontal governance and the accountability of local actors, an impetus is created for local offices and administrators to fulfil the local needs of the target groups concerned through their need for legitimacy. From the perspective of local co-ordination of employment and labour market policies, the lack of policy flexibility for local actors is identified as the principle obstacle for policy integration (Mosley, 2009). Highly centralised PES systems reduce the possibilities for joint-up, integrated strategies. There are two main reasons for a greater role of local policy integration. The first reason is related to the dynamic of the labour market, with its double and paradoxical character: on the one hand continuing structural unemployment, even in periods of economic boom, and on the other hand structural problems in filling vacancies and meeting new labour market needs. The paradox of the labour market applies specifically to the city. The city contains many jobs as well as many vacancies, but at the same time, there is high unemployment, which is systematically higher than on average. One important cause of the employment paradox is the fact that the profile of the jobseekers in the city often does not suit the jobs which are on offer. The second reason stems from the proximity of all relevant partners involved: jobseekers, firms, local social partners, political partners. In many countries, job creation and activation for work have been extended beyond what used to be considered as employment policy. Traditional boundaries between policy fields are being transcended. Policy implementation also requires coordination between relevant actors in related policy fields, such as local economic development, environment and social work. Following the OECD, the capacity of local actors to carry out these tasks successfully depends on local capabilities, which are to a considerable extent a function of the extent of political and administrative decentralisation in the national institutional setting: In developing such a joint up approach, the most crucial factor appears to be the flexibility available to local actors to adapt and deliver policy according to the strategic goals in partnership. In order to produce real change, local actors need to have sufficient authority within their own policy sector to actively influence the delivery of services (OECD, 2007). Local policy actors need more room for manoeuvre to adopt and implement joint approaches at the local level. Decentralisation presupposes that resources are allocated directly to the local level, while the role of the central level shifts from direct steering and intervention to accountability and control. Key factors for the successful implementation of local labour market policies are: - development of an integrated strategic plan with all relevant parties including government, business and the local community - local authorities seeing themselves as part of an overarching policy network and capable to manage these networks - local targets that are negotiated between central and local actors - co-ordination with central policy levels - financial resources directly channelled to the local level - effective monitoring and evaluation mechanisms.

5 5 References Barbier, J.-C. (2004) Systems of Social Protection in Europe. Two Contrasted Paths to Activation and Maybe a Third, in J. Lind, H. Knudsen & H. Jorgensen (eds.) Labour and Employment Regulation in Europe, Brussels: Peter Lang Blanpain, R., Landa J.P. & Langille B. (2009) Employment Policies and Multilevel Governance. Bulletin of Comparative Labour Relations N 71, Alphen aan den Rijn: Kluwer Law International Considine, M. (2000) Contract regimes and reflexive governance: Comparing employment service reforms in the United Kingdom, the Netherlands, New Zealand and Australia. Public Administration, 78 (3), Mosley, H. (2009) Decentralisation and local flexibility in employment services, in F. Larsen F. & R. Van Berkel (eds.), The New Governance and Implementation of Labour Market Policies (pp ). Copenhagen: DJØF-publishing Copenhagen OECD (2007) Designing Local skills Strategies. Interim Report, Paris: OECD OECD (2003) Managing Decentralisation. A New Role for Labour Market Policy, Paris: OECD Struyven, L. (2009) The local integration of employment services: assessing network effectiveness of local jobcentres in Flanders. Environment and Planning C, Government and Policy, 27(6), Struyven, L., Steurs, G. (2005) Design and redesign of a quasi-market for the reintegration of jobseekers: empirical evidence from Australia and the Netherlands. Journal of European Social Policy, 15(3), Struyven, L., Verhoest, K. (2005) The problem of agency at organisational and at street level: the case of the Flemish Public Employment Service, in E. Sol & M. Westerveld (eds.), Contractualism in employment services. A New Form of Welfare State Governance, The Hague: Kluwer Law International, p Theodore, N., Peck, J. (1999) Welfare-to-work: national problems, local solutions? Critical Social Policy, 19 (4),