Public policy. There should be no one who knows more about the perils and pitfalls of payment by results (PBR) than Justice Secretary Chris Grayling. After all it was he who as a DWP minister oversaw the implementation of the Work Programme which is as yet failing to demonstrate the step change in efficiency and performance that he is hoping to see from the probation service. There are several reasons to question whether PBR for probation will deliver: All PBR systems are subject to the inherent tendency for providers to ‘skim’ and ‘park’. The former process involves identifying those in the client group most likely to achieve an outcome (in this case not reoffending) with very little support. The provider then gets paid for something which would have happened anyway without having to add any value (economists call this ‘rent seeking’) and the taxpayer picks up the dead weight cost. * Relatedly, the PBR mechanism means the contracts have what is sometimes called a ‘smile’ profile. 1. 2.
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