Best Practices in Reintegration Services: Analysing Modes of Contracting in the Dutch Private Reintegration Market

Abstract

Over the last decade, many of the Western welfare states have found themselves under pressure to reform due to both exogenous factors, such as globalization and the ageing of society, and endogenous factors, such as a shift in focus from welfare to workfare. An important aspect of these reforms concerns the introduction of processes of privatization. One of the elements of the welfare state that has been subject to privatization is the provision of reintegration services. The Dutch reintegration market is regarded as a prototype of this form of privatisation. During the last five years, the Dutch reintegration market has been investigated extensively. What we know from this research is that the privatisation of reintegration services has gone hand in hand with many problems. At the same time success stories have been identified. However a clear understanding of the factors that have contributed to these successes is still lacking. Since the outcomes of reintegration services are influenced by many factors, such as labour market conditions, client motivation and client ability it is, however, very difficult to demonstrate to what extent reintegration services have contributed to the outcome. The quality of reintegration services is therefore difficult to measure on the basis of outcome measures alone, which might make output-based contracting inadequate. In this paper, we will argue that for a proper functioning of a private reintegration market the understanding and application of good contracting is essential. This entails more than just examining the design of the contracts, but also includes the comprehensive analysis of monitoring and enforcement of contracts. The goal of this paper is to identify some theoretical starting points for the safeguarding of public values during the process of delivering social services through private actors and the consequences this may have for identifying best practices.

Keywords: Privatisation, reintegration market, contracting-out, welfare reform, best practices, Netherlands

JEL Classification: I3, I38, L33