Expert group proposes major reform of employment programmes

Current municipal employment efforts have become too expensive, micromanaged and rule-bound. At the same time, a large proportion of citizens who come into contact with job centres experience an undignified process or an effort that focuses more on the rules of the system than on the individual's need for work or training.

This is the conclusion of a government-appointed panel of experts, which has now presented its recommendations for a comprehensive reform of the public employment programmes.

The expert group, led by Professor Claus Thustrup Kreiner of CEBI, Department of Economics, makes six main recommendations for future employment programme in Denmark.

They read in cue form:

1. Few target groups and special rules
2. Individually organised initiatives for citizens
3. Balanced system of sanctions with focus on decency
4. Dismantling of job centres and free organisation
5. Greater role for unemployment insurance funds and private providers
6. Performance management instead of process requirements

According to the expert committee, the centralised employment programmes have become increasingly complex and administratively burdensome. For example, the system currently divides citizens into 13 target groups and operates with more than 200 rules and special regulations across the target groups.

"There is great potential in a new approach that focuses on the needs of the individual citizen. Our report contains recommendations for the biggest ever reform of the employment effort, making the system cheaper, simpler and more dignified without weakening employment," says Claus Thustrup Kreiner.

Decentralised and flexible approach

In general, the expert group recommends a more decentralised approach, removing the requirement for municipal job centres and giving municipalities greater freedom to organise their own employment programmes, focusing on the needs of individual citizens. At the same time, there should be less detailed requirements for citizens and caseworkers.

Overall, the recommendations will result in savings of DKK 3 billion by 2030, the majority of which will come from reduced costs for operations and other counselling/training. For example, the expert group estimates that the number of interviews in municipalities and unemployment insurance funds could be reduced by around 500,000 per year.

The recommendations submitted to the government are the result of a lengthy process of analysis in which the expert group produced a number of sub-analyses and involved practitioners, researchers, organisations and stakeholders.

See the recommendations and analysis on the expert group's website (in Danish).