Agenda item

Report from the Strategic Director of Regeneration and Environment.

Recommendations:

That Cabinet:-

1. Approve acceptance of the Council’s indicative allocation of the Economic Inactivity Trailblazer funding to deliver activity targeted at implementing an integrated employment, skills and health system.

2. Approve use of the funding to manage the programme, commission community-based engagement activity, and personalised support (to include flexible support budgets), activate employers to create job opportunities for participants, pay for additional staff salaries (within RiDO, Employment Solutions and for other Pathways to Work roles within the Council) and cover miscellaneous costs.

3. Delegate authority to the Strategic Director, Regeneration and Environment, in consultation with Cabinet Member for Transport, Jobs and the Local Economy and the Section 151 Officer to determine detailed use of the grant or make any subsequent amendments to the proposed budget allocations.

Consideration was given to the report introduced by Councillor Taylor, Cabinet Member for Transport, Jobs and the Local Economy, and Tim O’Connell, Service Manager, regarding the Economic Inactivity Trailblazer programme. Members were informed that South Yorkshire had been selected as one of the national pilot areas for this initiative, aimed at addressing economic inactivity and supporting individuals back into employment through coordinated, targeted support.

Councillor Taylor reflected on the initial launch of the Pathways to Work Commission report the previous summer, describing the potential of the programme as highly aspirational. He noted that while it had been known for some time that South Yorkshire would serve as a trailblazer, clarity on the operational framework only emerged following a recent government announcement. He commended the report’s author for the significant work done to date and emphasised the ambitious targets ahead, alongside the opportunity to make a meaningful difference in residents’ lives.

The Service Manager provided an overview of the issue, explaining that an ageing UK population, a persistently high number of economically inactive individuals, and increasing job vacancies had created a growing mismatch in the labour market. In Rotherham, approximately 40,000 people had been economically inactive for several years. He highlighted that many of these individuals, despite not actively seeking employment, had indicated in prior research that they would prefer to work under the right conditions. The reasons behind economic inactivity were identified as complex and varied, ranging from caring responsibilities and education to long-term health conditions. The Trailblazer programme sought to address these barriers by unifying existing support systems such as NHS Growth Accelerator, Department for Work and Pensions support, and a forthcoming programme titled Connect to Work. The aim was to deliver personalised assistance, collaborate with employers on sustainable workplace changes, integrate data to drive effective intervention, and ultimately grow the local workforce.

It was reported that across South Yorkshire, the initiative aimed to help approximately 2,000 people secure employment, including 420 individuals in Rotherham. In addition, the programme sought to prevent around 950 people from becoming economically inactive. While acknowledging the difficulty and ambition of the project, officers emphasised the significance of the opportunity and requested the Council’s support in accepting the grant and proceeding with implementation.

Following the introduction of the report, the Chair invited further clarification regarding the allocation and use of the Trailblazer grant. In response, it was explained that the funding would initially be received by the SY MCA, which would then distribute the allocated amounts to local authorities. Rotherham’s allocation was confirmed to be approximately £1.7 million.

The grant would be used to support several key elements of the programme. This included the establishment of a system service manager function within the local authority to coordinate and improve integration across support services. Funding would also be allocated to provide personalised employment support. It was noted that Rotherham already operated a successful employment support service, Employment Solutions, and the grant would allow for the expansion of this provision as well as the development of complementary activities aimed at reaching cohorts not currently engaged.

Additionally, funding would support what was described as employer activation, involving direct engagement with employers to create suitable opportunities for economically inactive individuals. This could involve initiatives such as work simulation pilots, in-work support, and the use of personalised budgets to remove barriers to employment.

In response to a follow-up question from the Chair regarding leadership and accountability, it was confirmed that the Strategic Director of Regeneration and Environment held overall responsibility for the Economic Inactivity Trailblazer, while the Strategic Director of Adult Care, Housing & Public Health was leading the Employment Solutions team.

The Chair invited members of the Overview and Scrutiny Management Board (OSMB) to raise questions and queries on the points raised earlier.

Councillor Blackham welcomed the funding opportunity but raised concerns regarding the internal management and planning for the £1.7 million allocation. While not suggesting the Council should turn the funding down, the Councillor emphasised the need for greater clarity and direction. It was noted that the paper did not clearly outline how the funding would be used or managed.

The Strategic Director of Regeneration and Environment clarified that the funding formed part of a national pilot scheme, commissioned by the Department for Work and Pensions (DWP), with South Yorkshire being one of nine selected areas. The pilot aimed to explore new approaches to support a client group historically underrepresented in employment due to complex barriers such as ill health or caring responsibilities. Each of the four South Yorkshire local authorities had flexibility in designing and delivering their approach.

It was further explained that the Council intended to utilise the existing Employment Solutions service due to its strong track record. In addition, there would be engagement with voluntary and community sector organisations, subject to Cabinet approval of the report. A further strand of delivery would be led by the RIGO team in reaching out to employers. The Strategic Director acknowledged that this approach would evolve over time as the pilot progressed. It was also noted that the Secretary of State had recently indicated the potential for the scheme to be extended by a further three years beyond March 2026. Additionally, it was confirmed that funding had been allocated not only to combined authorities, such as the SY MCA, but also to devolved administrations, including the Welsh Government.

Councillor Yasseen expressed strong support for the funding and hoped it would significantly impact the target cohort. While acknowledging the pilot nature of the programme, she highlighted the need for more detailed plans. She explained that a large group of economically inactive individuals, such as students and Pakistani women in Rotherham, required tailored support with entering the job market. The Councillor also noted the importance of addressing the psychological barriers many in the target group face. She questioned the ambition of the target to engage thousands of individuals, given the complexities involved.

The Service Manager acknowledged that engaging thousands of people was a challenging target. He emphasised the need for innovative and flexible approaches to reach the target group, particularly by engaging the voluntary and community sectors, as many individuals do not feel comfortable with traditional routes like DWP or council services. The pilot programme would allow for experimentation with different methods of engagement. He noted that research from the Pathways to Work programme indicated that while many people in the target group expressed interest in working, they currently do not perceive the right support or circumstances to be available, leading to their continued disengagement.

There was a suggestion to further collaborate with health services, particularly addressing health-related barriers to engagement, and the potential of expanding social prescribing to include this group. In response, it was confirmed that collaboration with the health sector was a key component of the Pathways to Work approach. Efforts had been made to integrate health services with employment support, such as bringing work coaches into health settings. This aimed to engage a large portion of the economically inactive population, especially those with health issues. However, it was noted that health was just one aspect, and other factors contributing to economic inactivity would also need to be addressed with appropriate support.

Councillor Keenan inquired whether the program had specifically considered working with veterans, recognising that many ex-service personnel possess valuable skills but may face challenges re-entering the workforce due to factors such as PTSD, housing issues, and other circumstances. She asked if there were plans to collaborate with the Armed Forces Covenant Group or Armed Forces Charities to explore back-to-work solutions for veterans.

In response, the Service Manager explained that veterans were included as a cohort in the connect to work initiative, which was part of the broader Pathways to Work program. The goal of the initiative was to connect and integrate support systems, as veterans often need assistance from the broader system, not just veteran-specific services. The challenge, the Service Manager noted, was to ensure that veterans receive personalised support while also connecting them to a wider network of services. He confirmed that engagement with veterans’ groups and organisations would be a priority, and they would be open to further discussions with these communities.

Councillor Marshall asked whether the program would be extended and if there were any specific criteria that needed to be met for an extension, such as meeting the set targets. It was confirmed that reassurances had been received regarding no clawback of funding. Although no explicit targets were set for the extension, it was noted that the government had already expressed a preference to continue the approach for a longer period. It was suggested that, while no specific targets had been outlined, demonstrating progress and success would likely be important for securing the extension.

Councillor Bacon sought clarification about the progress of the Employment Solutions Team, noting that there hadn’t been much inroad on employment. In response, the Chief Executive (CEX) explained that when the investment in Employment Solutions was made, metrics were provided showing that the team had supported 879 people into employment and 825 into training since 2022. Despite the lower numbers, the team had higher success rates compared to other routes, as they worked with some of the hardest-to-reach individuals. The outcomes of Employment Solutions were among the top quartile when compared to similar organisations. The lower numbers reflected the challenge of engaging these individuals, but the effectiveness of the team had been demonstrated through evaluations presented in previous budget and scrutiny reports.

Additionally, the Councillor asked if the funding was known before the budget was set and the £718,000 allocated to the Employment Solutions Team. The Leader of the Council responded that while the exact amount of funding was unknown, ongoing negotiations with the government were taking place. The Leader emphasised that having a permanent workforce in Rotherham to support people back into work was a stronger position than relying on temporary, shifting grant funding. The Leader confirmed they would make the same decision again, as it ensured a more stable approach for Rotherham.

Councillor Bacon expressed concern, suggesting that the £718,000 was taken away from other frontline services to support a niche area and questioning why this was done before the funding was confirmed. The Leader clarified that Rotherham faced significant challenges, such as unemployment, low wages, and economic inactivity. Public engagement showed overwhelming support for the council's action to help the local economy, and the Leader agreed with that view. The Leader stated they would prefer having a dedicated team of people helping those out of work, rather than relying on uncertain government funding in the future.

Following the discussion, the Chair recommended that the OSMB would receive a progress update on the implementation of the Economic Inactivity Trailblazer programme within four months and a further report within twelve months following its implementation.

Resolved: That the Overview and Scrutiny Management Board supported the recommendations that Cabinet:

1. Approve acceptance of the Council’s indicative allocation of the Economic Inactivity Trailblazer funding to deliver activity targeted at implementing an integrated employment, skills and health system.

2. Approve use of the funding to manage the programme, commission community-based engagement activity, and personalised support (to include flexible support budgets), activate employers to create job opportunities for participants, pay for additional staff salaries (within RiDO, Employment Solutions and for other Pathways to Work roles within the Council) and cover miscellaneous costs.

3. Delegate authority to the Strategic Director, Regeneration and Environment, in consultation with Cabinet Member for Transport, Jobs and the Local Economy and the Section 151 Officer to determine detailed use of the grant or make any subsequent amendments to the proposed budget allocations.

Further actions that arose from discussions were that:

•       OSMB would receive a progress update on the implementation Economic Inactivity Trailblazer programme as soon as possible but within four months.

•       OSMB would receive an update on the progress of the Economic Inactivity Trailblazer programme within twelve months following its implementation.