Download 5_switzerland_from_centralized_to_decentralized_model

Federal Departement of Economic Affairs FDEA
State Secretariat for Economic Affairs SECO
Labour Directorate
Labour Market / Unemployment Insurance
From centralized to decentralized steering
The Performance Management System of
the Swiss unemployment insurance
WAPES Conference Moscow, Russia - September 2014
Olivier Nussbaum - SECO
Some facts and figures about Switzerland
and the Swiss labour market
 Population:
8.1 million, 23.8% of whom are foreign nationals
 National languages: German (65%), French (23%), Italian (8%),
Rumantsch (0.5%), other (21%)
 Net activity rate (15 - 64 age range): 83.5%
 Unemployment rate by ILO standards: 4.4%
Youth unemployment rate : 7.7%
 Liberal Labour Market policy
 Structure:
- primary sector
- secondary sector
- tertiary sector
3.5%
22.3%
74.2%
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Registered Unemployment: Regional differences (July 2014)
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Since 1995: active labour market policy
• Objective: rapid and durable reinsertion of jobseekers into labour
market
• Means:
- Regional Employment Centres REC
- Labour market programms LMP
- Strict definition of a ‘reasonable job’
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Rights and duties of job seekers
 Rights:
- Receive unemployment benefits
- Get help from job centres to find a new job
 Duties:
- Actively search for a new job (own initiative)
- Respect control regulations
- Respect instructions from the job centres
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From centralized steering…
• Pilot REC in two cantons 1995-1996
• Evaluation in 1996
• Decision of general implementation in 1996
• Deployment in 1997
 All cantons had to establish REC and increase LMP
 Number of counsellors per jobseeker
 Number of administrative staff per jobseeker
 Number of managers per counsellors
 Number of interviews per jobseekers
 Minimal offer of LMP and of counselling
Steering over input / output (resources and activities)
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… to decentralized steering
• Evaluation of the deployment phase in 1999
• The system being established, decision to switch to outcome oriented
steering from 2000
 Benchmark over outcome oriented indicators
 Global budget: maximal budget, but more freedom for the cantons
when it comes to input (resources) and outputs (activities)
Two very important aspects of the way we do things:
 Pilot before general implementation
 PLAN – DO – CHECK – ACT
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Management system – paradigm shift
3’000 local employment
offices
120-150 regional
employment centres
New agreements
unprofessional
professional
Input/output-oriented
professional
outcome-oriented
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Management by results
• Steering no longer via inputs, but via results achieved on reinsertion
of unemployed persons
• Confederation sets out objectives for the cantons. The Confederation
forgoes imposing detailed regulations. No longer tells cantons how to
reach objectives.
• Results-oriented agreement
• between cantonal governments and Federal Department of
Economic Affairs
• first agreement in 2000, renewed 2003, 2006 and 2010
• Budget allowed to the cantons depending on cantonal jobseeking
rate and cantonal number of jobseekers
paradigm shift (NPM)
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Preconditions for implementing PMS
• Political framework:
• Commitment
• Stability in goals / patience
• Evaluation / no over-steering
• Accept not to control everything centrally and accept local
differences in implementation
• Legal framework:
• Stable legal basis (law), also for financing
• Contracts between parties defining the modalities of PMS
• Technical framework: Data availability and quality
• Resources: Planning possible at regional level
• Process / Development of PES: Some processes must already be
implemented
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“Global budget”
• Budget of Regional Employment Centres depends on two
parameters: cantonal job seeking rate and cantonal number of
jobseekers (decreasing scale)
• Effective costs refunded
• Greater scope for the cantons regarding:
- Staff
- Investments
- Processes
- Active labour market measures
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Labour Market Authorities of Switzerland
SECO – Directorate of Labour
Labour Market / Unemployment insurance
Public employment services
PES
Unemployment funds
Regional
Employment
Centres REC
Employers
Jobseekers
Labour
Market
Measures
Disability
Insurance
Agency
Social
Security
Services
Federal
Cantonal
Labour Market
Cooperation
Career
Private
Counselling
Employment
Agencies
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SECO – Directorate of Labour
• Responsible for instruments of Swiss labour market policy
(Unemployment Insurance Act AVIG and Employment Services Act
AVG)
• Administration of unemployment insurance fund
• Supports cantons in strategic management
• Responsible for European agreement on the free movement of
persons
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Public Employment Services of the Cantons
• Responsible for:
• Implementing relevant legal acts
• Organising different public employment services: Regional
Employment Centres, unemployment funds, Logistical Centres for
Labour Market Measures
• Implementing labour market measures
• Most operative work delegated to public employment services
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Regional Employment Centres REC
• More than 120 Regional Employment Centres in 26 cantons
• More than 1,500 counsellors
• 4 instruments:
- counselling
- job placement
- training / labour market measures
- controls and sanctions
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Agreement between cantonal governments and federal ministry
Federal Ministry
(SECO)
Steering Committee
Cantonal
governments
Regulatory framework
Steering tool (benchmark)
Activity of cantons
- AVIG
- AVIV
Communication of results
Competition
Federal act / ordinance
Measurement of efficiency
(Result indicators)
- AVG
Process and output indicators
Activity according to the
law:
-
Counselling
Job placement
Training
Controls and sanctions
Financing
- vocational training
Review of the situation
Exchange of best practices
Transfer of best
practices
- operating cost
Outcome measurement
4 results indicators:
- Rapid reintegration
- Reduce long-term unempl.
- Reduce exhaustion of
benefits
Continuous improvement process
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- Reduce re-registrations
Objectives and indicators
Objectives
Indicator
Weight.
1
Rapid reintegration
Avg. no. of benefit days drawn by former
beneficiaries.
50%
2
Prevent/reduce longterm unemployment
Entrants to long-term unemployment divided
by the # of persons who entered a new
framework period 13 months earlier.
20%
3
Prevent/reduce
exhaustion of benefits
# of exhaustions of benefits in the reporting
month, divided by the # of persons who
entered a new framework period 2 years
earlier.
20%
4
Prevent/reduce reregistrations
Proportion of benefit recipients who reregister within 4 months.
10%
Rapid and sustainable
reintegration
Global indicator
100%
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Management by results :
The econometric model
• Purpose:
Enable comparisons between cantons
• How:
By setting off the influence of special regional
features (exogenous factors):
- Labour market situation
- Seasonality
- Nationality
- Frontier workers (persons living abroad and
working in Switzerland)
- Size of agglomeration
• Calculated and made public once a year, at the beginning of June of
the following year.
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Measure of performance: publication of
results
• Benchmark using the econometric model calculated and made public
once a year
• Relative benchmark. Average = 100.
• Published at the beginning of June of the following year.
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Example of relative Benchmark result
160
140
120
100
80
60
40
20
0
ZH BE LU UR SZ NW- GL ZG FR SO BS BL SH AR
OW
Total index
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AI
SG GR AG TG
TI
VD VS NE GE JU CH
Total index adjusted
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Some Lessons learned (1)
• Management by results is tried, tested and accepted
• Strong incentive for improvement (competition, reputation effect)
• Incentive to reintegrate jobseekers as fast as possible (social security is
financed by cantonal and local authorities)
• Incentive to cooperate with private employment services and any other
partner
• Better possibilities to act on part of cantons by introducing global
budgets
• Political shield
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Some Lessons learned (2)
• Too strong competition and monetary incentives lead to
demotivation
• Relation between inputs, outputs and impacts can not be modelled
• Strong focus on rapid reintegration may lead to neglect of
sustainability of reintegration
• Focus on benefit recipients may lead to a trade off with non benefit
recipients, the later being less taken care of
• Econometric model considered by cantons to be too complicated / a
black box
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Thank you for your attention
Olivier Nussbaum
Federal Department of Economic Affairs, Education and Research - EAER
State Secretariat for Economic Affairs – SECO
Labour Directorate
Labour Market and Unemployment Insurance
Holzikofenweg 36, 3003 Berne, Switzerland
Phone
++ 41 58 464 15 78
Cellular ++ 41 79 875 34 77
[email protected]
www.seco.admin.ch
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