HOW TO ACT? ANALYTICAL PAPER - AUGUST 2016 - Europa.eu
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ANALYTICAL PAPER
HOW TO ACT?
Implementation and evolution of the PES
conductor role: The Belgian PES in Flanders
as a case study
Employment, AUGUST 2016
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Luxembourg: Publications Office of the European Union, 2016
ISBN 978-92-79-59513-4
doi:10.2767/527014
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Cover picture: © European Union
The European Network of Public Employment Services was created following a Decision of the European Parliament and Council in June
2014 (DECISION No 573/2014/EU). Its objective is to reinforce PES capacity, effectiveness and efficiency. This activity has been developed
within the work programme of the European PES Network. For further information: http://ec.europa.eu/social/PESNetwork.
This activity has received financial support from the European Union Programme for Employment and Social Innovation "EaSI" (2014-2020).
For further information please consult: http://ec.europa.eu/social/easi
LEGAL NOTICE
This document has been prepared for the European Commission however it reflects the views only of the authors, and the Commission
cannot be held responsible for any use which may be made of the information contained therein.ANALYTICAL PAPER
HOW TO ACT?
Implementation and evolution of the PES
conductor role: The Belgian PES in Flanders
as a case study
Written by Ludo Struyven & Liesbeth Van Parys, Research Institute
for Work and Society (HIVA – KU Leuven) & Faculty of Social Sciences,
University of Leuven, Leuven, Belgium
In collaboration with ICF International
AUGUST 2016Abstract Public Employment Services (PES) are increasingly combining characteristics from all three modes of affected by changes in the economy and labour governance, i.e. hierarchy, markets and networks. markets. Rather than focusing on the imperative A key element of the conducting role is the inter- for change (what to do), this paper focuses on the action with other actors, regardless of the mode action (how to do it). Our starting point is that to of governance. Moreover, the mix of governance is deal with the current changes in governing and changing over time. A key factor for PES in our case implementing tasks in advanced economies, PES study, and probably also in other advanced PES needs new ways of making governance work. The systems, is keeping vital labour market information aim is to consider how the move from ‘actor’ to and matching processes under public control in an ‘regisseur’ (Conductor) as a model for labour mar- increasingly digitalised labour market. In this way, ket governance affects the role of PES. This new thinking of PES as a conductor is not the end of role of conductor is a key element of the PES EU PES as we know but rather the beginning of a pro- 2020 Strategy Output Paper, adopted at the end cess of reinventing PES as a prime public service. of the Danish Presidency in June 2012. The pur- pose of the PES EU 2020 Strategy Output Paper The paper is structured as follows. In section 1, we is to establish a Vision for PES delivery by 2020. It briefly introduce the PES 2020 Vision, the intended describes the necessary elements to create a mod- changes to the role of PES and the subsequent ernised service to deliver the EU 2020 Employment conductor role as described in the policy document. Strategy. It calls for a shift from a traditional em- Section 2 gives an overview of the different types ployment service to a labour market ‘conductor’. of governance and meta governance, followed by Implementing this Vision demands that PES offer a discussion of how the PES 2020 Strategy refers a wider set of services to enable various transitions to it. Following this analytical section, section 3 of- over the life-cycle and to support new customers fers an in-depth review of conducting by the Flem- (workers, inactive groups) with no traditional links ish PES based on four main activities: tendering, to PES. PES therefore need to become enabler, local job shops, public-private partnerships and coach and also a ‘conductor’ and facilitator in the digital services. Finally, section 4 offers a discus- labour market by building partnerships with other sion of lessons learned, followed by a conclusion. labour market actors. Based on the individual case study of the Belgian PES (Flanders), we conclude Keywords that the label of ‘conducting’ means more than just coordination through partnerships and networks. Public employment service, conducting, conductor In practice, there is an evolution from a single role, partnerships, service delivery, governance, mode of governance towards a multiple mode labour market actors, digital services, PES 2020.
5 CONTENTS 1. INTRODUCTION 6 2. PES 2020 AND THE CONDUCTOR ROLE 8 2.1 Three types of change 8 2.2 ‘Conducting’ as a key strategy for PES 8 3. DIFFERENT TYPES OF GOVERNANCE 10 3.1 Modes of operational governance 10 3.2 Governance in PES 2020 Strategy 11 3.3 Meta governance roles 12 3.4 Meta governance in PES 2020 Strategy 13 4. THE CASE OF THE BELGIAN PES IN FLANDERS (VDAB) 14 4.1 Introduction 14 4.2 Organisational structure 14 4.3 The quest for a new VDAB role 15 4.4 PES as a conductor of partnerships through tendering 15 4.5 PES as a conductor of local job centres 18 4.6 PES as a conductor of public-private partnerships 19 4.7 PES as a conductor of digital services 20 5. CONCLUSION 24
6
1. INTRODUCTION
The face of Public Employment Services (PES) has private intermediaries (Struyven, 2009). The pres-
changed radically over the past two decades, as sure resulting from both political drivers and the
has the underlying paradigm of public service. private market creates a continual challenge for
While academics have studied the causes, pro- PES to demonstrate efficiency and effectiveness.
cesses and consequences of the transformation In our view, this is the main reason that PES have
of PES in relation to activation policies (e.g. Consi- focused primarily on a NPM logic (customer-focus)
dine et al., 2001; Eichhorst et al., 2008; Van Berkel rather than a new public service logic (citizen-
et al., 2011; Weishaupt, 2011), only a few, mainly focus) (cf. Denhardt & Denhardt, 2015; Hasen-
historical studies focus on the change in public feld, 2015). In other words, PES reforms were
service as a whole (e.g. King, 1995). There is even first driven by the goals of efficiency and effec-
less scientific evidence regarding its future ori- tiveness through new forms of steering via part-
entation. This paper offers insights into the PES nership with both public and private profit and
2020 Vision, by focusing on the approach of the non-profit agencies. Less central to PES reforms
European Network of Public Employment Services1. were goals related to the promotion of democratic
How do they tackle the new role and functions governance and the realisation of citizenship. How-
of PES in response to fundamental changes in ever, it is important to acknowledge that the PES
labour markets and societies? These new functions 2020 Strategy envisions a value-driven approach,
are intended to support an individual through- promoting the translation of concepts and val-
out his/her entire career, instead of focusing on ues such as equality, honesty, reciprocity, respect,
the unemployment-employment dichotomy. PES social responsibility, professionalism and engage-
will therefore be required to support a number of ment into everyday service delivery.
transitions, including the switch from education to
first job, job-to-job transitions, the transition from The way employment services are organised in
inactivity to employment, and exit from the labour each country and the institutional characteris-
market. This means targeting customers on both tics of the organisations delivering these services
sides of the labour market, i.e. jobseekers (includ- are deeply embedded in the broader political-
ing employees) as well as employers (including administrative structures of the different welfare
intermediaries). This vision is rooted in the Transi- states they operate in. This results in considerable
tional Labour Markets (TLM) approach (Schmid & cross-country variations in terms of their depar-
Gazier, 2002; Schmid, 2010), which can be seen ture points. The Vision presented in the PES 2020
as a new paradigm for PES. Strategy Paper has been heavily influenced by
VDAB’s (Public Employment Service of Flanders)
This new role as conductor in the PES 2020 Strat- long-term strategy, as formulated in the so-called
egy, formulated by the Heads of PES and sup- VONK note (VDAB op Nieuwe Koers [VDAB takes
ported by the Commission, challenges PES’s a new path]) between 2008 and 2009.
traditional role as a welfare agency. The PES 2020
Vision represents a radical shift for PES, the ser- The PES 2020 Strategy Output Paper contains
vices they provide and the customer groups they a number of elements already part of VDAB’s
serve. This transition is consistent with a new national agenda which have now been integrated
mode of governance called ‘conducting’. into the PES 2020 Vision. Consequently, VDAB has
been chosen as an individual case study for this
PES customers typically exist within a highly com- paper. Several arguments justify reviewing a single
plex policy sector, with both a high level of ‘pub- case study. As explained in section 3, the Flemish
lic interest’ and a certain level of competition with PES was established in 1988 as a purely service-
oriented provider with, until recently, no responsibil-
ity for delivering benefits and controlling jobseekers.
1 The Network was established in 2014 on formal legal
footing following Decision 573/2014 replacing previous
As one of the exceptions in the EU, it still has
voluntary co-operation in the former Heads of PES authority over competencies and training of both
(HoPES) Network. jobseekers and workers. From the beginning, the7
organisation was characterised by relative stabil- To that effect, we rely on three methods for our
ity and autonomy vis-à-vis subsequent Ministers of analysis. Firstly, we look at existing sources and
Employment, creating space for the PES to develop perform a secondary analysis of available mate-
a long-term strategy. Furthermore, VDAB was an rial. Secondly, we conduct a review based on
early adopter of computerised labour market infor- the literature on meta governance in order to
mation and matching2. For these reasons, VDAB is strengthen the analytical foundation of the new
an obvious place to experiment with innovative PES roles. Thirdly, we produce an in-depth case study
strategies in Europe. of the Flemish VDAB, mainly based on interviews3
with management and stakeholders together with
In order to better understand the PES conductor research from previous studies4. We pay particular
role(s), this paper provides: attention to the areas of labour market transpar-
ency and digital services.
1. An overview of conducting models (including
stakeholders and actors involved) based
on existing examples, including how the PES
conductor role evolved in general and in
relation to specific intervention areas,
with a specific focus on digital services;
2. An analysis of the conductor role(s) in terms
of context, drivers, triggers, types of conduct-
ing strategies and actions, capacity require-
ments, accountability mechanisms
and coordination with other ‘conductors’;
3. An empirical study of the why, what and
how of conducting strategies in practice,
based on the case study of VDAB (PES
of Belgium Flanders).
3 We are grateful to the following respondents in the
set of interviews specially undertaken for this paper;
in alphabetic order these are Mireille Gillebeert,
Sven De Haeck, Ria Deketele, Walter Dobbelaere,
Sabine Pardaens, Joris Philips, Koen Pollet,
Willem Vansina – all VDAB staff – and Paul Verschueren
(Federgon, the peak body of private labour market
2 For that reason, in Section 3 special focus will be intermediaries in Belgium).
on labour market information and digital services. 4 See list of references in annex.8
2. PES 2020 AND THE CONDUCTOR ROLE
2.1 Three types of change the importance of linking public management and
organisation to public institutions’ role and func-
The change in PES’ role envisioned in the PES tions, we also build on insights from public man-
2020 Vision encapsulates three types of changes. agement theory, (see Bouckaert et al., 2010; Hill &
First, the Vision seeks to establish a new role for Hupe, 2002; Lægreid et al., 2011; Pollitt & Bouck-
PES in terms of service provision and target pop- aert, 2004) and on analytical and empirical studies
ulation based on the holistic TLM approach, in on employment services7.
which a person’s working life is described in tran-
sitions that should be facilitated by the PES sys- We start by outlining the PES 2020 Vision, and con-
tem5. Secondly, the Vision introduces the role of sider how PES currently perceive themselves in this
conductor vis-à-vis other actors, including custom- context.
ers, whether jobseekers or employers. Thirdly, the
Visions’ changes centre on management changes
to increase efficiency and effectiveness of service 2.2 ‘Conducting’ as a key strategy
provision. These three types of change, however, for PES
should not be seen in isolation: the management-
and role-based changes are essentially rooted in In 2010, under the Belgian presidency, the heads of
the move towards a TLM-inspired labour market all three Belgian PES and the Commission launched
policy. In other words, the aspiration to TLM pro- an initiative to link PES strategic positioning with the
vides the initial framework for change at PES level new 2020 employment guidelines adopted by the
as well as in the broader institutional setting of European Council in December 2010. The Commis-
the PES system. sion’s discussion note on ‘Making Transitions Pay’
(MTP) invited PES to take a position on the subject,
In the literature, the focus is mainly either on while the view of EMCO8 on MTP (approved by EPSCO
administrative reforms (mostly with a top-down on 21 October 2010) was to encourage the Com-
approach studying evolutions such as agencifica- mission to work with the Heads of PES (HoPES) Net-
tion6, contracting-out and decentralisation) or on work in order to share information and analysis on
the role of PES organisation in the functioning of best practices. This high level debate resulted in the
the labour market. Our paper focuses on the gov- PES 2020 Vision adopted at the end of the Danish
ernance of PES from an operational point of view, Presidency in June 2012 (HoPES, 2012). Throughout
in combination with the three main functions this process, there was broad consensus on the cen-
of a PES: job brokerage; intake, registration and tral role of PES in increasing labour market partici-
screening; referral to active labour market instru- pation (Guideline 7). PES largely agreed on their role
ments (OECD, 2015). The analytical angle draws on to improving links between supply and demand of
extensive literature on public sector organisational labour and to offer tailor-made services, particularly
reform, and on PES innovation as well. Because of for client groups with specific needs.
5 In the PES 2020 Strategy Output Paper, the notion
of PES system is used to allow for their role to be 7 See Thuy et al., 2001; Considine, 2001; Sol & Westerveld,
performed by non-state actors. 2005; Struyven & Steurs, 2005; De Koning & Mosley,
6 Agencification refers to the creation of semi-autonomous 2002; Bredgaard & Larsen, 2008; Schmid, 2010;
organisations that operate at arms’ length of the Weishaupt, 2011; O’Sullivan & Considine, 2015. This
government, to carry out public tasks (regulation, paper also took advantage from a number of previous
service delivery, policy implementation) in a relatively studies under the PES to PES dialogue as well as other
autonomous way i.e. there is less hierarchical and political work done under the PARES initiative (see references
influence on their daily operations and they have more in annex).
managerial freedom. Agencies can for example have 8 The Employment Committee (EMCO) is the main advisory
a different financial system and personnel policies, committee for Employment and Social Affairs Ministers
although the degrees of financial, personnel, and in the Employment and Social Affairs Council (EPSCO)
management autonomy vary by (type of) organisation in the employment field. It operates within the policy
(Pollitt & Bouckaert, 2004). framework of the European Employment Strategy.9
Strengthening personalised services, offering ●● aligning labour market actors with labour
early-stage support, prioritising vulnerable groups market policy/labour market needs (by
and extending services to inactive groups are selecting, certifying, coordinating, directing,
objectives shared by all PES throughout Europe. managing);
There is, however, less of a consensus on the role ●● acting as supplemental service providers
of PES in the development of a skilled workforce where market failure occurs.
(Guideline 8). This makes sense since not all PES
are responsible for providing training and services These are the recommended successive steps within
to groups other than the unemployed. the core role of labour market conducting. This role
should be seen as a layered concept, involving dif-
The PES 2020 Strategy Paper highlights balanc- ferent tasks that can be executed to varying degrees.
ing the supply and demand of labour as the core In this respect, no contradiction between different
business of PES. To prioritise this function, the roles is mentioned in the PES 2020 Vision. Apply-
Vision advocates that “Public Employment Ser- ing this type of lifecycle approach means the target
vices should approach labour demand and sup- group for PES expands to encompass new “custom-
ply from a more holistic point of view which takes ers” (i.e. workers, inactive groups) who may not have
into account the multiple transitions present- traditional links to the PES. PES therefore need to
ing themselves continuously on the labour mar- act as both enabler and coach (by informing citizens
ket and during individual careers” (HoPES, 2012). and investing in them while they make transitions),
This is necessary to achieve the objectives of the but also as a “conductor” and facilitator in the labour
EU 2020 Strategy, such as increasing the employ- market (by building partnerships with other labour
ment rate and reducing the number of bottleneck market actors and managing contracting-out prac-
vacancies. This type of holistic approach entails tices rather than keeping services in-house).
“a shift from functioning (only) as service provid-
ers towards (also) functioning as service seekers, For the individual customer, this means that PES
that compose scenarios for the most qualitative, will be involved both at the point of job placement
effective and efficient constellation of services to and in broader skills development and life-long
meet a specific need on the labour market” (ibid). learning activities. Moreover, PES clearly state that
they aim to become more demand-driven, mean-
With regard to service delivery, the PES 2020 Strat- ing a substantial increase in the current level of
egy document argues for an increase in services collaboration with employers. Although some con-
delivered by different actors through “intensifying cepts and suggestions are rather abstract, allowing
partnerships with private employment services’ as for different interpretations in national contexts, the
well as other public, not-for-profit and profit actors Vision describes some of the common operational
in other policy domains such as education and wel- and management consequences of PES’ new roles
fare.” This is identified in the Paper as “conduct- and functions. As such, a lot of attention is paid to
ing”, a key term for PES to achieve the objectives optimising PES performance through improved effi-
of Europe 2020. ciency and efficacy. It also touches on the new role
of technology in achieving this.
The different “levels of conducting” are described
here (ibid): In summary , the main building blocks underpinning
the PES 2020 Vision centre on four important topics
●● enhancing labour market transparency and for PES: the conducting role and partnerships; skills
providing evidence to support policy design; development and career services; employer services;
●● securing standards for active labour market and sustainable activation. The label ‘conducting’ can
policies; be considered as the cornerstone, involving several
●● identifying labour market needs and availa- layers or activities and ways of working. Some of
ble service offers; them are meant to have direct influence on ser-
●● matching citizens and employers with appro- vice provision and actor; others have a more indirect
priate and accessible services; influence on service provision.
●● enabling labour market actors to cooperate
and innovate;
●● commissioning market operation and part-
nership formation;10
3. DIFFERENT TYPES OF GOVERNANCE
3.1 Modes of operational governance be understood as new expressions of governance,
leaving behind more bureaucratic approaches?
With a strong focus on partnerships and multiple When does market-type or network type coordina-
roles, the PES 2020 Strategy Paper touches on both tion turn into a hierarchical mode of governance?
the ‘what’ and the ‘how’ of strategic goals. However, Is there really a switch away from the hierarchi-
this concept of ‘partnership’ conceals a wide range of cal mode?
relationships, with varying degrees of self-governing,
steering, intensity, scale, duration and intention. The In their seminal work on policy implementation, Hill
same is true for the ‘network’ concept, closely related and Hupe (2002) further elaborate on the three
to partnerships (See Brown & Keast, 2003). With the modes of governance by linking circumstances and
need to cope with increasingly complex and chang- management. Hill and Hupe’s taxonomy clarifies
ing environments, PES need to find answers on how what is happening in the evolution of PES (also see
to act. Action may take many forms, depending on Table 1 below):
context, motivation and capacities.
●● Starting with the first mode of governance
Following theoretical approaches developed since “by enforcement”, the central subject of action
Etzioni (1961), Lindblom (1977), Kaufmann et al. here is regulation and imposition. The deliv-
(1986) and Thompson et al. (1991), three general ery of products and services is seen as hav-
models of social coordination stand out. These are ing a non-excludable (public good) character,
known as the ‘trinity’ of i) hierarchies, ii) markets and such as considering entitlement to and pay-
iii) networks. Some authors (see above) refer to the ing unemployment benefits or administering
trinity as organisational settings, others refer to it in a vacancy database. The term “government”
terms of modes of governance, namely the forms refers to PES as a political-administrative actor
governance can take in practice (Milward & Provan, operating under a legitimate mandate that
2000; Hill & Hupe, 2002). Typically: justifies the government’s monopoly position.
This role as governmental actor has
●● When the organisation mode is hierarchical, it been labelled a Chief Executive Officer.
requires “effective methods of command and ●● To the extent that PES move towards contract-
the use of coercion or threat to ensure compli- ing with other public and private providers,
ance with authoritative rules”. they govern “by performance”. Action consists
●● In the market mode of organisation, the prob- of creating frameworks in which other actors
lem of compliance will be perceived as “rooted can perform. At the same time, compliance and
in self-interested behaviour”. results need monitoring to ensure that delivery
●● Network or “community” organisational forms frameworks function properly. The role of PES/
“rely on the operation of custom, tradition, government is that of an Inspector. In this type
common moral codes, values, beliefs, love, of contracting-out, the PES itself is not neces-
a sense of belonging to a ‘clan’ (Ouchi, 1991), sarily a purchaser, a role that an administrative
reciprocity, solidarity and trust” (Parsons, 1995: department or any other public authority can
518-519). perform. Once a market based system
is established, an inspection is needed to
It is not enough to focus on one mode of govern- monitor proper market functioning.
ance as a universal panacea and to dismiss the oth- ●● A third mode of governance is called
ers. Paraphrasing Parsons (1995), in the real world “co-production”; here an invitation to partic-
of PES there are almost nothing but combinations. ipate is central. PES and other actors work
Other authors state that “it is the mix that matters” together to achieve shared objectives. PES
(Rhodes, 1997; Keast et al., 2004). In current dis- takes the role of Regisseur (or ‘conductor’)
cussions around PES, there seems to be a move and invites, other actors to collaborate.
towards increased partnership and less hierarchy, Here, PES are asked to make reflective choices
although there is a question on the practice. How about modes of governance and governance
are different modes interrelated? Are they really to tools (Pollitt & Bouckaert, 2004).11
Table 1 : Modes of operational governance
GOVERNANCE ROLE ‘CEO’ ‘INSPECTOR’ ‘REGISSEUR’
Fitting mode ‘Enforcement’ Performance’ ‘Co-production’/
of operational (Management via inputs) (Management via outputs) ‘Co-creation’
governance (Management via
outcomes as shared
results)
Central mechanism ‘Rules’ ‘Contracts’ ‘Trust’
Managing intra- Creating clarity on tasks Creating level-playing (Helping) realising
and inter- and competences field partnerships
organisational
relations Taking care of sufficient Enhancing contract Enhancing
resources compliance professionalisation
Realising compliance Enhancing and Sharing resources
to standard operating maintaining service
procedures orientation Fostering innovation
Leadership Rewarding target Communication flows
compliance in both ways
CIRCUMSTANCES
Ambitions High Moderate High
Legitimate government Possibility to specifiy Complex services
monopoly standards of performance requiring high levels
of creativity
Dependency on other Low Moderate High
actors
Technical competence Availability of other Need for a more creative
in-house potential agents relationship
Source: adaptation from Hill and Hupe (2002)
Which of the three modes PES choose depends 3.2 Governance in PES 2020
on a combination of factors, including political Strategy
will and ideology. Hill and Hupe (2002) identify
two key factors: the level of ambition and the The picture painted by the PES 2020 Strategy,
level of dependency from other actors. They state Paper of conducting at each stage of the process
that: “when the level of ambitions and the level of – even as an actor providing services – limits the
independence are high, a governance role as CEO role of PES. Looking deeper, three distinct modes
seems appropriate. When on the other hand ambi- of governance and related coordination instru-
tions are high but there is a large dependency on ments can be phased out by using a single part-
others, a governance role as Regisseur fits (…) in nership metaphor. This highlights the following:
circumstances characterised in-between9 (…) the
governance role can be one of setting the struc- 1. The Vision hints at the need for a value-driven
ture (cf. the market) and monitoring its functioning approach and horizontal coordination via
(the role of the Inspector)” (p. 186). a single point of contact for citizens. Think-
ing of PES as a facilitator and conductor of
What is the PES view of these three modes of labour market partnerships can be seen as
operational governance? a call for constructive collaboration between
trusted partners – hence networking. Partner-
ships and networking usually involve a wider
range of actors, including schools, employer
9 Circumstances in-between may be for instance an
awareness that other service providers than oneself
organisations, local governments, pursuing
can do the job better combined with moderate common goals of public interest. The Vision
ambitions as the state’s own service provider. also touches on another mode of market12 coordination. Indeed a major section in the to be a credible labour market conductor and PES 2020 Strategy document refers to the at the same time as being a substantial ser- renewal of the internal organisation and vice provider? In this paper, we state that the management of the PES. These types of fundamental element of conducting is the reforms often follow New Public Management interaction with other actors, not just in rela- concepts and tools, such as performance tion with a network mode of governance but management, decentralisation and compet- with all three modes of governance. itive tendering. Surprisingly, tendering and voucher systems are hardly mentioned, even Before returning to these questions, the next section though in practice these are central to the discusses the role of the PES as a ‘meta governor’. recent evolution of PES. 2. The metaphorical and superficial use of partnership can be partly explained by the fact 3.3 Meta governance roles that, in reality, no single model of tendering, i.e. networking, exists. Hybrids are much more The term ‘labour market governance’ denotes a pro- common than pure forms, which are currently cess in which a number of public and private actors in place only in Great Britain, until recently interact to govern the labour market. This stems from in The Netherlands, for defined periods in the fact that PES have become a differentiated, frag- Denmark, or at specific stages of implemen- mented and multi-centred institution dealing simul- tation in Australia (Struyven, 2014). In some taneously with benefits, labour market information, countries, the tendering model may even be job brokerage, activation, training, and even career closer to a co-production model, while in guidance. The dividing line between public and pri- others it is a hybrid between the hierarchical vate is blurred because governance is often produced and contracting models (e.g. Australia). by networks involving all types of actors. This sits in 3. Looking at shifting modes of governance, contrast with PES operating in a top-down bureau- the “partnership lifecycle” is very important cratic system of hierarchical rule. (Lowndes & Skelcher, 1998, p.320). In a pre-partnership collaboration, PES can invite When complex labour market issues and capaci- actors to make a particular contribution. ties are scattered between different actors, indirect At this stage, the network mode dominates. ways of influencing and coordinating the actions Once a partnership has been created, hierar- of self-governing actors or networks are needed. chy establishes formal procedures. Next, part- Meta governance is an indirect form of governing, nership service delivery takes place through performed by influencing various processes of self- market mechanisms of tendering and con- governance. This involves the management of com- tract. In partnership termination, there is plexity and plurality through the “organisation of a re-assertion of a network governance mode. self-organisation” (Sørensen, 2006). Sørensen, later Problems in establishing a market and refined by Sørensen and Torfing (2009), identifies steering it towards a government’s goals are four distinct ways of metagovernance of self-gov- typical for emerging market models, because erning actors (cf. Temmerman et al., 2015). market coordination is inherently driven by an actor’s own interest. In the same way, ●● The first role is “hands-off” network design. a co-production model inherently raises According to the authors, this role aims to problems of accountability – who carries “influence the scope, character, composition the responsibility when actors are jointly and institutional procedures of the network” responsible? (p. 246). In the network design role, PES seek 4. Finally, the term ‘conductor’ invites PES to to create social and political meaning in the take advantage of new forms of collabora- identity of the network. tion. Conducting is an overarching concept ●● The second role is network framing. PES set that leaves a lot of room for interpretation out the goals, financial conditions and admin- and implementation. Indeed: Does conduct- istrative basis for the network. ing mean the same as coordination, steering, ●● The third role is network support and commissioning? Or does it refer to all types facilitation. of collaboration with other actors (other than ●● In the fourth role of participation, PES become contracting-out)? What difference does one of the members of the network. it make in practice? Is it compatible for PES
13
In terms of the Conductor role vis-à-vis self-gov- because it threatens the self-governing capacity of
erning actors, these range from distant “hands- partnerships (Temmerman et al., 2015). To analyse
off” to “hands-on” roles. “Hands-off” means not precisely how each role should be played in practice,
directly interfering in operations, whereas “hands- several strategies come into play, based on how
on” means interacting directly with the self-govern- far the “shadow of hierarchy” is actively deployed.
ing actors. The authors describe “hands-on” as in no Deployment of hierarchy can be useful or even nec-
way assertive, but substantively neutral, simply to essary to protect the public interest from negative
promote actions by other actors. compromises and practices (Hill & Hupe, 2002).
After all, hierarchy is a strong coordination mecha-
The question remains then: in which situations nism (Laegreid et al., 2015, p. 935). It may prevent
is meta governance the only applicable form of unwanted effects of networking arrangements, e.g.
labour market governance? If meta governance when a private actor prescribes its own model or
is believed to be the only applicable form, which employs self-seeking tactics against PES or other
type of meta governance is the most applicable in actors. But it may also lead to exactly the opposite
which situation? Although PES may be in a good of an intended pre-partnership stage and under-
position, meta governance is not only exercised mine shared goals. Particularly within the context
by PES, but also by various actors at regional and of service delivery, there is a new tension between
local levels in the labour market ecosystem. Fol- meta governance role-playing and preserving and
lowing governance theorists, meta governance can securing a public service.
indeed potentially be exercised by any resourceful
actor – public or private (Sørensen, 2006, p. 103). The “hands-off” roles of network design and fram-
ing are particularly promising when it comes to
finding innovative solutions and mobilising the
3.4 Meta governance in PES 2020 expertise and resources of other actors to deal with
Strategy repeated job transitions and transitions between
working and learning, caring or job seeking. PES
Various indirect ways of influencing and coordi- strategy mentions “the capability to constitute
nating the actions of other self-governing actors partnerships, enable cooperation and compose net-
in the labour market gives PES more scope to sup- works” as the “strategic conducting function that
port them or become one of them. Several lessons PES are acquiring or have to acquire” (Leroy & De
can be learned from this. Haeck, 2014). This is because “PES have to extend
their own mediation and guidance services with
In the role as meta governor, PES should adopt those of other public and private service providers”
a mix of “hands-off” and “hands-on” roles. Meta (p. 44). This is particularly useful where PES need
governor role-playing is dependent on the objec- to anticipate and react quickly to meet labour mar-
tives and contexts in which it should happen. But, ket challenges (e.g. employment integration of ref-
particularly in mandated networks, how is their ugees). A precondition is that PES and government
right to exercise rules reconciled with the practi- policy goals align. However in a context of increas-
calities of meta governance role-playing? Firstly, ing target setting at the European policy level (e.g.
networks or partnerships supplement hierarchy Youth Guarantee), there is also an increasing risk
rather than replacing it (Laegreid et al., 2015a). that supranational policy goals are not in line with
It might typically be associated with policy net- genuine policy challenges at regional and sub-
works, but the meta governor role can also help regional level. Also conceivable are cases where
in a service delivery context where PES activities PES execute “hands-on” roles without taking the
involve managing internal and external relations lead in operational delivery. However, in general
to comply with standard operating procedures they do not exist for long as room for manoeu-
and reward target compliance. This is different vre is limited because PES are forced to deploy
from a policy network context, where PES activi- scarce resources to meet organisational targets.
ties involve appealing for responsibility and realis- Indeed, PES require considerable discretion from
ing partnerships to “make it happen”. Current PES government if they want to act as a meta gover-
often operate in both. nor in networks conducted by other actors. Another
important precondition is to create a balance
The mere existence of hierarchy-based coordination between vertical organisation-specific accounta-
instruments in network settings is not a problem on bility and horizontal cross-cutting accountability.
its own, but it should not be allowed to dominate14
4. THE CASE OF THE BELGIAN PES
IN FLANDERS (VDAB)
4.1 Introduction (OCMW). The PES oversees the initial registration
of unemployment and the monitoring and sanction-
Not only does multiple role-playing require room ing of jobseekers’ availability to work10. VDAB’s per-
for manoeuvre and a relatively autonomous formance is assessed against the goals and targets
organisation, it also rests on adequate corporate set out in the Yearly Business Plans11. The current
governance and organisational structure. VDAB is government decided to dispense with the (5 year)
an organisation that “pushes constant learning, Management Contracts from 2016 onwards, which
co-creation, innovating” (Leroy & De Haeck, 2014). may mean less room for VDAB to make its own
In its own terms, “PES ought to pursue constant strategic choices.
service design renewal and organisational maturity
upgrading in view of increasing responsiveness to Provincial management boards are established, at
changing labour market needs” (p. 45). PES must sub-regional level, under the responsibility of head
reinvent themselves. Core functions of mediation, office. They in turn are responsible for the 13 labour
registration and activation are at stake. Stated this market management offices. These have a front
way, the main driver for PES is to reposition itself office function only, with everyday management
as an indispensable and leading conductor of the responsibilities brought together at a higher level.
labour market. However, this inevitably causes Within local communities, PES operates around
concern within the PES system and the implemen- 90 job shops (werkwinkels)12. These job shops are
tation of this imperative is very complex. intended as a single point-of-contact for people
seeking employment. They combine PES services
This section contains an analysis of expanding and with those provided by the municipality and other
evolving conductor roles based on the Flemish PES actors, including the social welfare centres (OCMW)
as a case study. After an introduction to VDAB’s and organisations providing assistance to people
structure, reforms and transition into a conducting with work disabilities. In addition, most cities and
organisation, four sub-sections focus more spe- larger municipalities have a competence centre for
cifically on the PES’s conducting across four main professional training. The management of these
activities: contracting-out through tendering; co- was already largely established at the intermedi-
production through local job shops; public-private ate provincial level, but they will now be coordi-
partnerships; co-creation through digital services. nated by the management board at provincial level,
alongside local job shops.
4.2 Organisational structure The reinforcement of decision-making power at
VDAB’s provincial level, introduced in 2012, was
VDAB is the public actor in the Flemish labour mar- intended to increase coordination between the medi-
ket. It enjoys the status of an externally autono- ation and activation services, as well as the training
mous government agency, and is run jointly by services. A large part of VDAB’s budget is spent on in-
the Flemish representatives of employer organ- house training services for both the unemployed and
isations and trade unions (the “social partners”). employed. Integrating the competence centres aimed
Following the second state reform in 1988, unem-
ployment insurance schemes remained the respon-
sibility of the federal social security institution RVA, 10 Since the latest (sixth) state reform in 2014, finally
the monitoring and sanctioning competence has been
while responsibility for job brokerage and reinte- referred too to the regional PES and implemented
gration of jobseekers passed mainly into the hands from January 2016.
of the Flemish government and VDAB. Unemploy- 11 VDAB was the first public agency in Flanders for whom
ment benefits are paid by the National Employment the Flemish government made use of multi-annual
management contracts, practiced from 1993 until
Office (RVA) while other relevant social benefits (the recently (2015).
so-called minimum income recipients) are paid by 12 Derived from 134 job shops in the early 2000s, which
the municipal Public Centres for Social Welfare corresponds on average with 1 shop per 3 municipalities.15
to simplify the tendering process by organising it at out by private players. At that time, the notion of
provincial level for both competence centres and basic services referred to the entire body of services
labour market management offices. This approach involved in applying for benefits, screening appli-
creates more room for smaller external providers. cants and managing their intake.
More than 15 years later, VDAB now has a divi-
4.3 The quest for a new VDAB role sion responsible for its conducting functions,
known as the ‘Regie’ Department. Currently, ten-
The quest for a new definition of the role of the dering, partnership management, labour market
VDAB began in 1999 and took a decisive turn in information and European funds all fall under its
2003. The new government coalition took the new remit. The expenses for other actors amount to
ILO Convention no. 181 as an opportunity to launch 17 percent of the total annual VDAB budget. Over
a radical shake-up. The relevant passage from the time, conducting emerged in four main activities:
government coalition agreement stated that: contracting-out through tendering; co-production
through local job shops; public-private partner-
“As a result of the recent International Labour ships; co-creation through digital services. All of
Organisation Convention, the labour market has them are labelled as conducting, for every activity
been opened up to private intermediaries. These without exception. The next four sections focus on
intermediaries play a vital role in the labour mar- conducting in each of these four activities.
ket and each contributes in its own way to better
coordination of the market. To foster this, the role
of the VDAB must change from that of a central 4.4 PES as a conductor of partner-
actor to the steering role of a central ‘regisseur’. ships through tendering
This steering function will mean that the VDAB
enters into cooperation agreements with the pri- Contracting-out, or tendering of employment and
vate sector to ensure the efficient and transparent training services, is the first domain in which con-
functioning of the labour market and increasingly ducting is critical.
develops into a support organisation for that mar-
ket. The services it provides are moreover com- In Flanders, tendering initiatives emerged in 2004
plementary to the qualitative services provided by with the political aim to expand and modernise the
other intermediaries, and particular care will be playing field by inviting tenders for assistance to
given to safeguarding the provision of services for jobseekers. An important driver was the increased
those at risk in the labour market” (Flemish Coali- effort to encourage job-search behaviour among
tion Agreement, 1999). jobseekers, which was set out in the 2004 coop-
eration agreement for activation policy13. However,
The Flemish Parliament supported this shift and it is important to clarify the policy objective. Firstly,
agreed the motion calling for, among others, (1) the primary objective is not to reduce the volume
a clear separation between the steering (‘regie’) and of public execution but to organise it differently.
implementation (‘actor’) functions to ensure trans- Secondly, the responsibility for the execution of the
parency of the public provision, and (2) full integra- tendering model is with the PES in its capacity as
tion of the private sector in the service delivery. contracting authority. Thirdly, VDAB already had
experience in organising the outsourcing of training.
Firstly, the intention was that the existing public ser- There is nothing intrinsically new in this but what
vice, which for a long time had enjoyed a monopoly, is different is that it is being organised in line with
should be transformed into a conducting function the Law on Public Procurement, hence the use of
(the regisseur role), with reference to the role of the the instrument ‘call for tenders’. The aim is to make
government relative to the entire field of intermedi- projects more demand-oriented and to attract new
aries. Secondly, the government was keen to embed players. Furthermore, tenders for region-specific
the notion of ‘basic’ services in the public service, training packages are relatively small packages. In
with the remainder of the service delivery carried practical terms, this process means:
13 Cooperation agreement regarding active assistance
for and monitoring of job search behaviour concluded
on 30 April 2004 between the federal government,
the regions and the communities.16
●● Both training packages and employment The process is then played out by autonomous
assistance tasks have shifted towards com- actors. These hold a double position and, to a cer-
peting private (commercial and non-commer- tain extent, this applies to commercial, non-commer-
cial) organisations. The content is contractually cial private actors and even to various public actors:
stipulated by the PES (as the contracting on the one hand they defend the public interest, but
authority), and one or more service providers on the other they also pose a risk as both social and
are contractors. economic actors. This implies that they cooperate as
●● The public service responsible for the registra- well as compete to achieve a given outcome as effi-
tion and allocation or maintenance of a job- ciently as possible. How the actors prove their worth
seeker’s allowance refers the jobseeker to the is very complex and various relationships are created
service provider(s). In principle, the jobseeker between the actors:
can choose between multiple service providers.
●● Generally, candidates who are referred to 1. between the jobseeker as customer and the
a provider cannot simply be refused placement service, and between the customer
or referred back to the public service that and the provider. Both are a professional rela-
referred them. The idea here is to create tionship, a relationship of trust;
a barrier that prevents creaming by focus- 2. between the jobseeker as a requesting party in
sing on jobseekers who are easier to place. the service providers’ market: this in principle
Moreover, PES oversees the execution of the presumes freedom of choice and competition;
contract, monitors placement outcomes and 3. between the PES as contracting authority
continues to manage the jobseeker’s dossier. and the service provider: this is a competitive
●● VDAB is still responsible for a given ‘basic’ relationship which turns into a principal/agent
service (registration, first intake, referral as men- relationship;
tioned earlier) and does not have to buy services 4. between the service providers: this either
from private service providers for all jobseekers. involves cooperation or competition;
●● Generally, VDAB offers limited in-house 5. between the PES which provides a basic
services for recently registered jobseekers, service and referrals, among others, and the
while more intensive services for specific service provider: this in principle is a profes-
target groups are left to the market players. sional relationship involving coordination
and exchange of information.
There is a potential conflict of interest in the var-
ious roles when PES, as contracting authority and These relationships develop against the backdrop of
in-house service provider, decides which service pro- economic and professional contexts, which overlaps
viders the jobseeker is referred to (internal, public for each of the three actors (the contracting author-
or external, private). Consequently, PES becomes the ity, the service provider and the jobseeker). This is
“judge and jury”, which questions the legitimacy of shown in the figure on the next page.
the public service’s activities, even though in practice
there is no conflict around the referral of candidates
to market players.17
Figure 1: Types of relationships between actors in the tendering model
Competition /
principal-agent PROVIDER
PES relationship (3)
AS ECONOMIC Co
TENDERING m
)
ACTOR pe
tit
(2 io
oice n
(4
Ch )
OTHER
JOBSEEKER
PROVIDERS
) Tr
t (1 ust n
us (1 tio
Tr ) ra
e
op (4)
Co
PES AS PROVIDER AS
PROFESSIONAL Coordination / exchange PROFESSIONAL
of information (5)
The new constellation creates a new level of com- As mentioned in section 2, there is no single model
plexity as designing a coherent and stable system of tendering. Anyone following the developments
becomes more difficult. This stems from the rigor- in these markets in other countries will realise that
ous demands of design, management and organisa- there is no single model for organisation and that
tion of the system (see, inter alia, Stiglitz, 1988; Le design choices in countries with greater public mar-
Grand & Bartlett, 1993; Struyven, 2004; Struyven & ket tendering experience also vary (Finn, 2011).
Steurs, 2005; O’Sullivan & Considine, 2015). At the This can be explained by the objectives and experi-
same time, each tendering system must consider the ences of previous tender processes, and how actors
appropriateness of the policy goals that are imple- (commercial and non-commercial) anticipate these
mented by market governance and the organisation (Struyven, 2014).
of that system within the framework of current legis-
lation on public procurement. This leads to five fields Having experienced successive tendering for more
of tension: than 10 years, it is generally acknowledged that
the involvement of private actors has helped gov-
●● competition based on price versus quality- ernments to achieve their activation goals. VDAB
based competition; focusses on improvements in quality assurance and
●● low access thresholds versus quality and monitoring. The choices between successive tenders
innovation; are also changing in Flanders and thus influence the
●● transaction costs versus competition; market in terms of development and the services
●● client’s freedom of choice versus activation on offer. In addition, more knowledge of the poten-
duties; tial market is needed to identify which actors have
●● result-driven versus process-driven. expertise in which solutions. VDAB, in its own words,
is attached to good partnerships and healthy mar-
In a tender, each choice has implications for one of ket relationships.
these parameters. Choices impact upon each other
and the consequences will vary depending on the In theory, this should mean that the types of ser-
actors’ characteristics and strategies. We can expect vice providers vary, with a mix of large and small
differences between commercial and non-com- players, commercial and non-commercial players.
mercial organisations, or between large and small At the same time, tasks should be clearly divided
organisations. between the PES and the external service providers,
and the policy strategy to develop a public market
should be consistent.18
However in practice, VDAB’s senior management 4.5 PES as a conductor
acknowledges that they are forced to tender for of local job centres
compliance with the Law on Public Procurement,
regardless of the target group and type of services. The second domain of conducting for VDAB relates
Tendering as an instrument is not always appropri- to local job shops (werkwinkels), which began in
ate to specific aims, in particular when it comes to the early 2000s. The government wanted to bring
innovation or specialised expertise (e.g. only pro- together related services, which until then had been
vided by NGOs). divided between different bodies to avoid access
thresholds and overlap. The local ‘job shops’ model
Furthermore, in Flanders, NGOs currently seem to was the result, a sort of one-stop shop per munic-
have less chance at winning large tenders that cover ipality or group of municipalities under the joint
broader, wide geographical areas. On the other hand, management of VDAB and the municipalities. To
the main body of private providers in Belgium com- reach all jobseekers, basic services became the
plain about VDAB’s case-by-case approach, claiming responsibility of VDAB, meaning they could not be
that there is no specific policy around calls for tender. outsourced. Other services could be provided by
In addition, the government’s perception is that com- private players as part of the trajectory guidance.
mercial and non-commercial players are each other’s The distribution of steering was as follows: VDAB is
competitors, while in reality they complement one responsible for the integrated service together with
another. It remains that opportunities for investment, the other partners in the job shop; the municipalities
specialisation and cross-pollination are too limited are responsible for the development of the local
(Struyven & Van Parys, 2009). service economy. In reality, only the first task came
to fruition, with the local job shop primarily run by
Finally, private providers can feel forced to move VDAB. Initially the intention was that the local job
into a reference framework for pricing and for shop should be formed like a cooperative structure
measuring results, which does not always take into and established under separate decree. However,
account ’specific contract requirements. Such rec- this decree stalled at the draft stage. In 2004, the
ommended prices are often based on VDAB’s own job shops therefore acquired a legal basis via the
estimates of the time needed to provide a spe- founding decree for VDAB.
cific service, which in turn has contributed to pric-
ing strategies from providers that are too low to VDAB has been in charge of these job shops from
develop a given market (Ibid.). the outset, although their mission is to create an inte-
grated service (a service provided in collaboration with
To sum up the above points, while the policy dis- other partners). Counsellors helping jobseekers with
course continues to call for cooperation and equiv- basic services such as registration and job search, and
alence (instead of market forces and competition), jobseekers’ trajectory supervisors both have a place in
the tendering process, as an instrument of the mar- the job shop. In this sense, the job shop is intended to
ket-mode governance, practically results in the use work as a gateway to other actors.
of hierarchical instruments represented in an author-
ity-mode of governance (e.g. quality assurance and However, in practice integrated service delivery
monitoring; reference framework for pricing and between VDAB and local social services never hap-
result measurement). This evolution diminishes the pened and there is an institutional explanation for
chance for meta governor roles to emerge. this. The extension of one-stop shops to unemploy-
ment and other means-tested benefits is limited in
One alternative to the above mentioned complexity, Belgium by the constitutional division of responsi-
which is typical of tender systems, consists of vouch- bilities between different policy levels. Firstly, the
ers or individual accounts. These alternatives do exist national Benefits Agency (RVA) in Belgium is not for-
in Flanders for employees’ career guidance and train- mally involved with the local job centres, although it
ing and the VDAB has become the central point of was not prohibited from doing this. Secondly, social
information and purchase of vouchers. But this is not assistance benefits remain the responsibility of the
seen as part of the conducting role. federal government and are organised within the
municipalities by their public centres for social wel-
fare (OCMW: Openbaar Centrum voor Maatschap-
pelijk Welzijn). An important principle of integrated
services is the creation of one file per client (a single
view of the customer): client data is collected by allYou can also read
