In April 2018 the Scottish Government launched Fair Start Scotland, its first fully devolved employment service. The service’s aim is to reach out to and help people who are further from the labour market, including individuals who have disabilities or long-term health conditions.

We were commissioned by the Scottish Government to carry out an independent economic evaluation of Fair Start Scotland. To determine the value for money of the service, we used the DWP Social Cost Benefit Analysis (DWP SCBA) model. Since this model utilises data at the individual level, it was time consuming and prone to user error, especially with 10,000 data point to impute. Therefore, our economists worked closely with our developer team to create a bespoke algorithm to streamline the analysis. We also created representative groups of participants which were then scaled up to reflect the entire population. This freed up valuable time that helped us generate additional insights on the wider impact of the service.

It quickly became apparent that a purely fiscal evaluation would not be enough to capture the full impact of Fair Start Scotland. This is because Fair Start Scotland had much wider social goals than simply moving people into employment. These included contributing to inclusive growth, improving the wellbeing of its participants, treating them with dignity and respect, and helping them achieve good quality jobs. It was important to take these aspirations into account to thoroughly evaluate the service.

Our analysis yielded very interesting results and highlighted the importance of taking a wider social impact approach to economic evaluations. Because of the way the DWP SCBA model and the incentive payments of Fair Start Scotland were structured, there was an underestimation of the value for money of moving people with disabilities into employment. As a result, the areas that helped the largest proportion of people with disabilities appeared to have performed the worst in terms of value for money.

We became aware of this limitation early on in the analysis, and we made sure that it was reflected in the report and in our recommendations. Instead of only looking at areas with the highest value for money as estimated by the DWP SCBA to gauge the best performance, we advised learning from the areas that achieved lower financial benefits but reached the people who most needed help.

Read our report here.

Economic Evaluation of Fair Start Scotland – Scottish Government