Fair Start Scotland - individual placement and support review: findings

A full report including findings and recommendations of an independent review of Individual Placement and Support (IPS) in Scotland commissioned by Scottish Government and produced by Social Finance.


Context and COVID-19 Impact

The Scottish Government has a target to halve the disability employment gap by 2038[60]. With rising unemployment linked to Covid-19, the Scottish government policy response has so far focused on youth unemployment and supporting those who have recently, or are at risk of, losing their jobs[61]. Economic output in Scotland is currently more than 10% lower than pre-COVID levels, and 15% of all employees in Scotland were furloughed in August[62]. Unemployment is forecast to peak at 8.2% in the fourth quarter, up from 4.6% currently[63]. There is, therefore, a significant risk that the recession will widen the disability employment gap and create a large, long-term welfare liability for people who are out of work and do not access "mainstream" support programmes, such as FSS.

These recommendations are designed to address this challenge and support the target of halving the disability employment gap. Cost, outcomes data and estimates in this section have been calculated using pre-COVID data as this is the best evidenced material available. While it is expected that COVID-19 will have an impact on service outcomes in the near term, we feel the data outlined below is appropriate because:

  • evidence shows that IPS services are able to support clients into work even during economic downturns[64];
  • IPS services in England supported clients into work throughout lockdown, and outcomes are now recovering.

1. In future, IPS for those with severe mental illness should be commissioned outside of FSS through a partnership between health and employability commissioners

a. To achieve the Scottish Government target of halving the disability employment gap, employment needs to be made a core health outcome and / or Local Delivery Plan (LDP) Standard;

b. International benchmarks suggest that 100 Employment Specialists would be required to reach 25% of the eligible population in Scotland each year;

c. The increase in provision should be phased over 5 years, and implementation support will be crucial to high fidelity delivery;

d. It will be important to build on the examples of good quality local IPS services that work closely with local health boards; piloting an expansion of provision in these areas is a recommended route forward.

IPS for people with Severe Mental Illness should be commissioned outside of Fair Start Scotland (FSS) contracts

The evidence base for IPS has been largely constructed around offering an integrated employment service in mental health teams for people with severe mental illness (SMI). Our analysis shows that few people with SMI are accessing this support within FSS. This is for two main reasons:

  • People with SMI are more likely to claim work-related benefits that have no conditionality requirements or obligations to seek work. They are, therefore, less likely to volunteer for a mainstream employment support programme;
  • Employability providers that have not been commissioned by the health system typically find it challenging to integrate with mental health teams. We have found this to be true for FSS providers as well. Since most IPS services generate referrals directly from mental health clinicians, a lack of integration will naturally limit the number of referrals into the service for people with SMI.

Given that IPS is highly effective for people with SMI, there is a strong rationale to find an alternative commissioning model. The aim would be to enable IPS services to better integrate with mental health teams and, therefore, to attract more referrals from SMI clients.

The optimal commissioning arrangements of IPS for SMI would closely involve the health system

International experience shows that the best way to enable IPS service integration in mental health teams is for the health system to be closely involved in the commissioning of the service. In Scotland, this input from the Health System would likely include Health and Social Care Partnerships and Integrated Joint Boards, which include both NHS and Local Authority representation.

Firstly, this model underlines the benefits of IPS as a health intervention rather than as a model to reduce benefit claims. Secondly, the health system can use its existing commissioning structures and processes to ensure that IPS is seen as a part of mental health provision and not as an add-on or ancillary service. Finally, the health system can use its relationships and networks to build engagement and buy-in to the role that employment can play in mental health recovery.

There is strong rationale for the health system to be closely involved in the commissioning of IPS. IPS is a recommended intervention by the National Institute for Health and Care Excellence (NICE) for adults with psychosis and schizophrenia. The rationale in the NICE guidance states: "Unemployment can have a negative effect on the mental and physical health of adults with psychosis or schizophrenia". [65]

This is equally recognised in Scotland's Mental Health Strategy, which states that "work can be good for mental health". It includes an action to "explore with others innovative ways of connecting mental health, disability, and employment support in Scotland".[66]

IPS has a strong evidence base for delivering positive health outcomes alongside employment outcomes for people with SMI. The academic evidence shows:

  • IPS achieves twice the rate of job outcomes for people with severe mental illness versus traditional employment support[67];
  • A six-country European trial of IPS found that an 11 percentage point reduction in hospitalisation rates for people receiving IPS and a four point reduction in time spent in hospital[68];
  • IPS can reduce health service use with fewer days spent in hospital and reduced rates of readmission.[69]

In Scotland, an existing high-fidelity IPS service has demonstrated that these results can be replicated in the Scottish labour market and health system context. Reported outcomes include a 40-60% reduction in CPN appointments in year one after securing employment, a reduction of 3 to 6 psychiatry appointments in year one following employment, and a net average cost saving to the NHS of £374 per service user.[70]

Potential way forward for IPS delivery for people with SMI in Scotland

Based on NHS Scotland data, we estimate that 100 IPS workers would be needed to support 25% of clients with SMI who are interested in work in a given year. For context, NHS England have set targets for 50% of the eligible population to have access to an IPS service by 28/29.

IPS Grow data suggests that the cost of supporting 25% of the eligible population each year would be approximately £5.8m p.a. This would support approximately 1,640 clients into work each year. See Annex C for more detail.

Figure 7: Estimated IPS need to support 25% of eligible population
NHS Scotland Region Estimated # of People in Contact with SMI Services[1] Estimated Clients Eligible for IPS[2] Estimated number of ES needed[3]
1 Ayrshire and Arran 3,654 987 6
2 Borders 6,000 1,620 10
3 Dumfries and Galloway 1,342 362 2
4 Western Isles 224 60 1
5 Fife 3,706 1,001 6
6 Forth Valley 2,820 761 5
7 Grampian 5,098 1,376 9
8 Glasgow and Clyde 9,966 2,691 17
9 Highland 5,588 1,509 9
10 Lanarkshire 6,586 1,778 11
11 Lothian 9,312 2,514 16
12 Orkney 268 72 1
13 Shetland 194 52 1
14 Tayside 5,666 1,530 10
TOTALS 60,424 16,314 104

[1] Data taken from NHS Scotland data showing number of new outpatients by health need (Mental Illness) per area in 2018[71]:

[2] We have estimated that 10% of the clients in contact with secondary mental health care are already in work, and 30% would be interested in finding work in a given year.

[3] NHS England have set a target of supporting 50% of these clients with IPS each year. IPS Grow data shows that 1 employment specialist can work with 40 clients per year.

Recommended steps to realise this plan

This plan builds on the experience of England and Ireland, where the engagement and leadership of the health service has led to a rapid expansion of IPS services that are well-integrated within mental health teams.

1. Establish a national steering committee that includes leaders in Scottish Government from the Disability Employment team, Mental Health Directorate, and existing IPS services;

This board would take responsibility for development and implementation of the subsequent priorities (listed below).

The board would also provide recommendations to future policy development around IPS. Work is underway in Scotland to develop a blueprint for local employment commissioning models; this board would shape how IPS provision should fit into this framework. The group would also ensure that there are standards for commissioning IPS services to maintain fidelity as provision scales.

2. Recognition of work as a health outcome within Local Delivery Plan (LDP) Standards, for Health Boards to report on;

Each year, the Scottish Government sets performance targets for NHS Boards to ensure that the resources made available to them are directed to priority areas for improvement and are consistent with the Scottish Government's Purpose and National Outcomes. LDP Standards are priorities that are set and agreed between the Scottish Government and NHS Boards to provide assurance on NHS Scotland performance.

Work should be recognised as a health outcome within LDP Standards. This would start from the premise that work is a health outcome and that IPS is recommended as part of NICE guidance for the treatment of psychosis and schizophrenia in adults[72]. Health boards should be set specific access targets for IPS services for their area, based on the number of patients in contact with secondary mental health teams, as outlined in the table above.

3. The increase in provision should be phased over 5 years, with a programme of implementation support to enable high quality practice and engage NHS practitioners in the benefits of employment support for people with SMI

New IPS services take time to reach high fidelity. This experience has been demonstrated in Scotland where the Glasgow and Fife IPS services both increased their fidelity scores over a period of years. Achieving buy in locally, recruiting the right team and integrating with clinical teams are all time-intensive activities and yet essential to achieving IPS fidelity. In turn, higher fidelity IPS services achieve better outcomes and support more clients into work[73]. For this reason, we recommend that IPS provision for people with SMI is scaled up over a five-year period.

In addition, the experience of the USA, Ireland, New Zealand, Australia and England has shown that implementation support is critical to establishing high fidelity IPS provision. The USA, which has the longest experience of growing IPS services, has found that maintaining an IPS State Trainer role has been essential in ensuring consistent and sustained quality[74]. Similar roles have now been put in place in many countries around the world.

Implementation support typically has three elements:

  • Operational Support
    • provision of fidelity reviews to assess service quality
    • creation and implementation of service improvement plans
    • supporting local stakeholders develop buy in from local health systems
    • training for Employment Specialists and Team Leaders
    • establishing and facilitating communities of practice to share learnings
  • Workforce Development Support
    • development and execution of workforce development and training programmes
  • Data and Performance
    • o centralised data collection and benchmarking of service performance

Given that there is no existing framework for health commissioning of IPS services, we recommend the following phasing:

Year 1: focus on establishing LDP Standards, building senior policy buy in from mental health directorate, developing implementation support. Start expanding existing high-fidelity IPS services within the health system, such as:

1. NHS Lothian IPS service: which has been funded directly by the local health board since its inception around 15 years ago

2. Glasgow SAMH IPS service: this service has been funded through a combination of Big Lottery and Local Health Board funding

3. FifeIPS FEAT service: the service has received funding from the local authority and local health board

Years 2 – 5: a phased ramp up of provision to reach the targets outlined above. There are a number of options for how this could be achieved including:

Existing Service Size: This phasing could be developed based on the current size of services in each area. For example, areas with existing provision may be able to scale more quickly than areas without existing provision.

Grant Catalyst Funding: Central grant funding could kick-start delivery in new areas, with areas bidding to be in the first round of funding.

Phased Scale Up: Areas could be placed into Phase 1, 2 or 3 based on the quality of existing IPS services in the area, their potential to develop high-fidelity IPS, or their need for additional time and support to develop IPS.

2. Existing IPS delivery within FSS could be improved through capacity building support and future contractual changes

a. Providers should develop their IPS capacity and capability, including partnership working with clinical teams, service adherence to IPS fidelity principles, staff understanding of the model through standardised training and quality assurance and supervision processes that promote IPS practice;

b. Achieving high-quality IPS delivery will require specific targets for IPS access and numbers of Employment Specialists, greater percentage of block funding and a more developed service specification;

c. A suggested service model could be 2 IPS Employment Specialists and a part time team leader in each lot. With good clinical integration and referral pathways, this could allow 900 FSS clients per year to receive an IPS service[75].

Fair Start Scotland is designed to support clients furthest from the labour market to return to work. Achieving job outcomes for these clients, who would be unlikely to enter work without support, not only achieves health and social benefits for the individuals, but also presents the greatest cost benefit to the government.

We consider that modest changes to the FSS contracts would support a greater uptake of IPS delivery. While there may be limited scope for amendments within current FSS contracts, these changes could be made to future Fair Start Scotland delivery programmes.

These include:

1. A more detailed service specification and targets for providers around their IPS delivery

This would include targets for the number of referrals into the IPS strand as well as job starts and job sustainments. It would also include minimum requirements on the number of IPS team leaders and IPS employment specialists on the contract.

2. Either a reduction in the level of Payment-by-Results in the contract or a re-weighting of outcomes payments so that more funding is linked to engagements and job starts rather than job sustainments

This will enable providers to invest up-front in IPS delivery with less risk that outcome payments will not materialise. Interviews with providers suggested that few are willing or able to make significant investments ahead of outcomes. Weighted the contract less strongly towards long-term job sustainments would facilitate more upfront investment and support for clients furthest from the labour market. This could include paying for job outcomes for the SMI cohort who enter work for less than 16 hours per week.

3. Removal of the application of service credits for failure to meet certain KDIs

KDIs could be re-focused around adherence to the fidelity scale rather than more detailed targets.

4. A process to embed continuous improvement

For example this could include a requirement to undertake independent IPS fidelity reviews on a bi-annual basis along with more regular guided self-assessments. The IPS National Expert Forum, hosted by IPS Grow, has developed detailed guidance on the best practice approach to fidelity reviews.

5. Implementation support to help providers build IPS capability

Technical assistance, delivered through an implementation support programme, could play a vital role in helping providers meet IPS fidelity standards. This approach has been used in almost all countries that have successfully rolled out IPS to both reach and then sustain high fidelity levels.

6. The development of national standards around the pay banding and training IPS Employment Specialists in Scotland

These standards could include a requirement for all IPS Employment Specialists to undertake a multi-day training course, supplemented by in work mentoring and supervision. The training could be face-to-face training, delivered by IPS experts, or low-cost online courses available through IPS Grow (England) or the IPS Works network (USA). We also recommend the adoption of standard pay bandings for Employment Specialists linked to Agenda for Change Band 5 level and for Team Leaders to Band 6 level.

International evidence suggests that IPS services are more robust and achieve better outcomes when Employment Specialists work in teams and receive management support. We would, therefore, recommend as a starting point that each FSS lot is required to employ at least two Employment Specialists, supported by a part time team leader who may also have a caseload. We understand that some FSS providers stated as part of their bids that this would be delivered.

Based on an average caseload size of 20, a team this size would be able to work with approximately 100 clients per year in each lot, a total of 900 clients across FSS. We would anticipate 300 IPS clients achieving job outcomes per year through this approach.

Although we consider that the measures above would significantly enhance existing IPS delivery within FSS, we believe there is a much more significant opportunity to deploy the IPS model within FSS. This is outlined in our third recommendation below.

3. IPS provision within FSS should be expanded further to all clients with complex health and disability-related barriers to work. This would make Scotland a pioneer in demonstrating how to achieve outstanding outcomes within mainstream employment support

a. Scotland is the first nation in the UK to include IPS within mainstream disability employment provision and benefits from a set of committed and engaged providers and policymakers;

b. IPS is the best evidenced intervention to support those furthest from the labour market into work;

c. Delivering effective community based IPS will be even more critical in the context of the current Scottish labour market.

We recommend a phased expansion of IPS delivery to all clients accessing Fair Start Scotland with complex health and disability-relatedbarriers to work. This would improve job outcomes for this cohort, supporting the Scottish Government's policy objective to halve the disability employment gap.

The first evaluation report of Fair Start Scotland notes that "Scottish Ministers have committed to a 'test and learn' approach".[76] Our review has identified three key learnings that present an opportunity to iterate and improve the current model:

  • There is very limited existing provision of IPS within FSS;
  • IPS is the best-evidenced model of employment support for people with severe mental illness. There is emerging evidence that it is effective for a wide range of other groups with complex health and disability-related barriers to employment;
  • There is no clear rationale for why some clients should receive IPS and others should receive a non-evidence-based service.

Our second recommendation above outlined a series of actions that could be taken to improve existing IPS delivery. The logical extension of this recommendation is to apply IPS, the best-evidenced model, to the whole cohort of people with complex health and disability-related barriers to employment.

There are two key challenges to this:

1. IPS is too expensive to offer to a wider group of people

2. This would be too significant a change to the FSS programme at this stage of delivery

We address these objections in turn.

Cost-effectiveness of IPS

Our analysis suggests that IPS delivery costs £2,000 per engagement. This is comparable to other mainstream employment programmes, such as the UK Work and Health Programme, with indicative costs of £2.1k per person[77].

Figure 8: Cost-effectiveness of IPS
  IPS cost estimates
Estimated Unit Cost of Engagement £2,000 [1]
Estimated Annual Cost of Engaging all Clients with Complex Barriers to Work £6,000,000 [2] + implementation support
Actual / Estimated Annual Job Outcomes 930 [2]
Estimated Unit Cost per Job Start £6,500 [1]

See below for calculation detail

[1] Unit cost of IPS:

The unit cost of an IPS service in a "mainstream" setting is estimated to be £2,000 per engagement.

This is a prudent estimate of the likely costs. Cost analysis of IPS services in SMI cohorts have shown that the average cost per engagement is £1,300[78]. We have increased the costs to factor in: provider margin, time to embed performance, and operational complexity to allow for supply chains to reach rural geographies.

This cost is also backed up by academic research from the University of Sheffield which estimates that delivering IPS within a "mainstream" setting, with caseloads of 25 and the employment specialist delivering employer engagement but networking into local services to support clients to deal with other barriers to employment (such as health) would cost £2,050 per unit[79].

The average cost of a job outcome with IPS is therefore approximately £6,500, based on the benchmarks of around 30+% of clients of IPS services securing a job[80]. Again, this is a prudent, upper end estimation. Evaluation of IPS services in England identified that the unit cost per job start was £4,400[81].

[2] Costs of Expanding IPS provision

Based on an estimate of 3,000 clients accessing FSS with the most complex barriers to employment annually, the cost of delivering IPS to all this cohort would be £6m. Again, this is based on prudent, top end cost estimates of £2,000 per IPS case.

The University of Sheffield have estimated that IPS in mainstream settings could save between 9 and 66 pence per £1 spent in cashable tax and benefit savings, excluding reduced expenditure on health and wider support services. This is based on a caseworker having a caseload of between 20 and 25 clients and supporting between 30 and 35% of them into work[82].

Opportunity to change FSS

Contractual changes would be required to expand IPS provision in line with Recommendation 2.

We recommend that this is achieved as part of a phased process to first establish a solid baseline of IPS activity (as per Recommendation 2) and then expand to whole cohort. Given that FSS contracts are due to expire in March 2023, there is limited time within the existing contracting structure to implement these changes. It is important that changes are not rushed and sufficient time is provided to implementation support as providers transition. We would therefore recommend that Recommendation 3 is taken forward in future programmes, rather than within the existing contract.


Email: boswell.mhonda@gov.scot

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