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Experimental Analysis of Mandating Participation in New Deal for Over-50s

This report evaluates the New Deal 25+ program for individuals aged 50 and over, focusing on the effects of mandatory participation in the Intensive Activity Period (IAP). The analysis is based on a randomized control experiment conducted from 2004 to 2006, examining outcomes related to employment and benefit status. Preliminary results indicate encouraging trends, although important questions arise regarding the representativeness of pilot areas and the timing of randomization. The full implications of the mandate will require further observation beyond initial participation.

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Experimental Analysis of Mandating Participation in New Deal for Over-50s

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  1. Mandating full New Deal participation for the over-50s: an experimental analysis Richard Dorsett & Stefan Speckesser, Policy Studies Institute Commissioned by Department for Work and Pensions

  2. Overview • Background • Evaluation design • Interim results • Interpretation and generalisability • Conclusion

  3. Background

  4. New Deal 25 plus (ND25+) • ND25+ is a mandatory programme for individuals aged 25+ who have been claiming JSA for 18 months. • ND25+ has three elements: • Gateway • Intensive Activity Period (IAP) • Follow-through. • For those aged 50+, IAP is voluntary. Many choose not to volunteer so in 2002 government announced intention to pilot IAP mandate

  5. ONS population estimates

  6. Evaluation design

  7. Experiment • Those eligible randomly assigned to action group (mandatory IAP) or control (voluntary IAP) group • Randomisation takes place at start of Gateway - effect possible from that point on • Adviser collects background information then telephones DWP who assign. Customer informed immediately • Randomisation ran from: • 5 Apr 2004 – 31 Mar 2006 in 11 areas • 10 Jan 2005 – 30 Jun 2006 in 3 (ERA) areas. • Identify effect of mandate rather than IAP itself

  8. Data

  9. Data • Track outcomes using administrative data • 2,305 participants randomised up to 24 June 2005 • Merge with New Deal Evaluation Database (NDED) • 87 (3.7%) not found in NDED • 28 (1.2%) appear to start ND25+ after RA • 129 (6.0%) participants excluded as duration on Gateway longer than 28 days before RA • Result: 2,061 participants (89%)

  10. Interim results

  11. Regression results - exits to employment

  12. Regression results - exits to non-JSA benefit

  13. Duration analysis: predicted effects on status after 1 year (% point differences)

  14. Interpretation and generalisability

  15. 1. Are the right people randomised? • substantial number of eligibles excluded • substantial number of ineligibles included • Considerable variation across JC+ districts • Does this matter? Perhaps it replicates how policy would operate when rolled out nationally.

  16. 2. Is randomisation on time? • Experiment does not replicate how programme would operate when rolled out nationally • This does matter – do not observe full effect of mandate

  17. 3. Are pilot areas representative? • Compositional differences between pilot and non-pilot areas - eg ethnicity, age, length of benefit claim • Treatment differences between pilot areas (action and control groups) and non-pilot areas • those in pilot areas take 3 weeks longer until IAP • treatment offered under IAP differs across pilot and non-pilot areas

  18. Conclusion • Early results appear encouraging but important to note that these are preliminary. • Need to observe individuals beyond first ND25+ exit – final report will use more complete data. • Some deviations from programme design – highlights the importance of monitoring • Some issues relating to generalisability of the results need careful thought: • identification of eligible customers • timing of randomisation of eligible individuals • pilot representativeness

  19. Interim report available from: http://www.dwp.gov.uk/asd/asd5/rports2005-2006/rrep362.pdf

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