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| Introduction | Basic Information Reports | InfoMISEP Reports |
NATIONAL LABOUR MARKET POLICIESInforMISEP Reports
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| Organisation | Continuous information on *: | Monitoring | ||||||||||||||
| Country | Monitoring | Coordi- | Decentra- | Local | Incen- | Sanctions | Budget | Partici- | Post-participation | Training | Employ- | Level of | Trend | Observations | ||
| institutions | nation | lisation | budget | tives | pation | pro- | ment | develop- | ||||||||
| among | (Decon- | discretion | gramme** | pro- | ment | |||||||||||
| institu- | centra- | motion** | ||||||||||||||
| tions | tion) | |||||||||||||||
| Employ- | Qualifica- | Earnings | ||||||||||||||
| ment | tion | |||||||||||||||
| Belgium | MoL, ONEM, VDAB, | + | +++ | + | - | - | n.a. | n.a. | n.a. | n.a. | n.a. | n.a. | n.a. | + | Regional particularism hinders | |
| FOREM, ORBEM | overall monitoring, monitoring | |||||||||||||||
| activities regional | ||||||||||||||||
| Denmark | n.a. | |||||||||||||||
| Germany | BA, IAB | +++ | ++ | ++ | - | - | ++ | ++ | ++ | - | - | ++ | + | ++ | Strong system development; not all | |
| mesures monitored | ||||||||||||||||
| Greece | MoL, OAED, PIEKA | + | + | + | - | - | ++ | + | - | - | - | ++ | + | + | Development of regional | |
| employment observatory | ||||||||||||||||
| Spain | MoL, INEM, | ++ | + | + | - | - | ++ | + | + | - | - | ++ | + | + | ||
| FORCEM | ||||||||||||||||
| Finland | MoL | +++ | ++ | ++ | - | - | +++ | +++ | ++ | - | - | ++ | ++ | +++ | High stage of development (MbR) | |
| France | MoL, ANPE | ++ | ++ | ++ | + | - | ++ | ++ | + | - | - | ++ | ++ | ++ | Not all measures monitored; both | |
| ANPE and MoL are actively | ||||||||||||||||
| developing the system | ||||||||||||||||
| Ireland | DEE, DSW, FAS | ++ | ++ | + | - | - | ++ | ++ | ++ | + | + | ++ | ++ | ++ | ||
| Italy | n.a. | |||||||||||||||
| Luxemburg | n.a. | |||||||||||||||
| Netherlands | LBA, CBA, RBA | ++ | +++ | ++ | - | - | ++ | ++ | + | + | - | ++ | ++ | ++ | ||
| Austria | MoL, AMS | ++ | ++ | + | - | - | ++ | ++ | + | - | - | ++ | ++ | ++ | New AMS is developing | |
| monitoring | ||||||||||||||||
| Portugal | MoL, IEFP | + | + | + | - | - | ++ | ++ | ++ | + | - | ++ | + | + | Development of regional | |
| employment observatory | ||||||||||||||||
| Sweden | MoL, AMS | +++ | +++ | +++ | + | - | +++ | +++ | ++ | + | - | ++ | ++ | +++ | High stage of development | |
| (MbR) | ||||||||||||||||
| United | DEE, ES, IC | ++ | ++ | ++ | + | (+) | +++ | +++ | +++ | ++ | + | ++ | ++ | ++ | ||
| Kingdom |
** for training programme or employment promotion ++ = thoroughly monitored + = less thoroughly monitored
Source: Questionnaire, selected expert interviews and related documents, own classification; UK: provided by MISEP correspondent directly.
As far as the continuous observation of selected indicators is concerned, most respondents indicated that information on budgets and on participants (level and structure) is available, but sometimes only for certain programmes. However, the most important problem in this area is the absence of "compatible" budget and participant data as a first step towards a comparative cost-benefit analysis across employment measures: such information is required for effective monitoring. Also the timing differs: in some countries (Sweden, Finland) most information is in principle on-line, in others only monthly and/or quarterly data exist. All countries have at least annual reports, but they are of limited value for monitoring purposes as annual data usually arrive too late to change the conditions of unsatisfactory programmes early on. No consistent picture for timing preferences across countries emerges, although the trend is clear: the more monitoring is developed, the shorter the time interval to which monitoring refers. Timing of information is a crucial issue in general, but especially for budget data: usually such data is not continuous, but of ad hoc nature. This sort of budget information flow has major drawbacks for efficient programme administration. On the one hand, it often happens that all of a sudden administrators become aware a budgetary ceiling has been reached, and a sudden stop in programme delivery is required. On the other hand, there are cases where the budget is not fully utilised and money has then to be spent urgently. Thus for example the usual end-of-the-year run starts: money "has" to be spent on programmes that under such circumstances often do not deliver the best results nor reach target groups. This general problem of annual budgeting, which is also an argument for longer budgeting periods, could to a large extent be eliminated through continuous monitoring of the budgets. Thus in Sweden, since the inception of the monitoring system money allocated has usually been spent according to plan.
While consistent, comparative budget and participation data are the base-line indicators for monitoring input and output, outcome variables clearly have to be considered in order to assess policies adequately.
The follow-up of employment status, of qualification attained and of earnings after participation in various policy measures is performed differently in the countries observed.
Employment status is an indicator frequently analysed in many countries, although the timing (i.e. after three, six or twelve months) and the extent (for all measures or for selected measures) vary quite substantially across countries. Also the ways in which this follow-up is carried out varies: it is usually either done by postal survey or by administrative means (participants reporting to the employment office).
Qualification levels attained after training measures are not frequently assessed. Patchy information is available in some countries (see table), but in general this is not an important monitoring indicator. One reason seems to be that training courses often do not lead to certified formal qualification; where this is the specific aim of the course, this information is in general available (e.g. in the UK's present effort to establish a National Vocational Qualification Certificate). This makes it difficult to classify participants according to qualification levels attained. Also in training courses post-participant employment is the main indicator for success.
Unlike the US (and other English-speaking countries), where increased earnings are a major indicator of success, European monitoring and evaluation seldom analyse earnings after participation in an employment measure as an indicator of success. Ireland is an exception in that regard as it runs sample surveys six and twelve months after completion of measures, which are published yearly. In Sweden such earning follow-ups are done infrequently (one was conducted at the end of 1995) and are in any case not tied into administrative monitoring practices.
It seems that training programmes are more thoroughly monitored than employment promotion (job creation) programmes (see table). One reason for this might be simply that training programmes play a more important role than employment programmes in almost all countries.
In conclusion, our overview of the state of the art of monitoring and the monitoring trends in the EU countries shows a rather clear North-South divide. While it is true that most of the countries have as yet not developed fully fledged monitoring systems, all of them have established parts of such systems. But it is the more developed countries of the North and the Centre with a long tradition of employment policy delivery that are more advanced in the development of their monitoring systems. We have noted that Sweden and also Finland have rather sophisticated systems. Ireland, the UK, Germany, France, Austria and the Netherlands (and also Denmark, which is not included here) have monitoring experience for some of their policies and, moreover, are intensively developing these systems. Because of its regional particularism, Belgium is an exception: while there is little evidence of overall national monitoring, attempts to introduce monitoring on the different regional levels have been made. Greece and Portugal (and also Spain and, to our knowledge, Italy) have for different reasons not yet gained significant monitoring experience. Although their activities in the field are increasing, it seems that they are not currently "catching up" with the northern countries. Therefore mechanisms to exchange "best-practices" are necessary to reach a more homogeneous state of development in monitoring throughout the European Union.
EU countries clearly experience problems in setting up monitoring systems. Although certain problems are common to all countries, some also face complications relating to their particular administrative structure and other specific factors. Besides problems of coordination between different agencies in charge of monitoring, it is the lack of clear goals in employment policy measures that often makes monitoring difficult. Here the often contradictory relationship between short-term quantitative goals (the prime interest of politicians especially prior to elections) and long-term qualitative goals (whose fulfilment is often targeted by those directly in charge of the participants) plays a role. Thus, for example, centrally set quantitative volume goals create problems even in the traditionally more bottom-up decision-making channels of Swedish labour market policy. A more technical problem reported was also the lack of adequate data (or difficult access to such data) from which to construct indicators. Also the lack of personnel and financial resources was seen as a problem, as was the acceptance of monitoring by those whose work was monitored because of the element of control involved. Thus it is important to show that monitoring is not an instrument of control, but a way of enhancing the efficient working of the organisation.
A monitoring system should consist of:
1. input, output and outcome goals specified by the political and administrative authorities at national, regional and local levels in a bottom-up procedure;
2. a definition of indicators that allow goals to be measured;
3. the actual monitoring process based on 1 and 2 and on statistical information on financial and physical indicators relating to 1 and 2; and
4. feedback loops to ensure that observed irregularities are addressed adequately.
Figure 1 illustrates such a monitoring model. It starts with policy formation in which programmes and individual measures are chosen. Even at this early stage clear goals for the programmes must be defined, and indicators enabling progress toward those goals to be measured must be established if monitoring is to be effective. In other words effective monitoring must be written into laws and ordinances (as is the case in the French five-year employment law of 1994). After programmes have been implemented, a continuous process of observation should begin, the intervals of which may vary from measure to measure. A quarterly observation period seems a reasonable compromise, but for short-term programmes shorter periods might be appropriate. The core function of monitoring is to detect indicators turning "red" and to initiate subsequent remedial action (feedback). Feedback between monitoring and programme implementation is stronger than between monitoring and policy formation because of the role of monitoring as an instrument linked to programme implementation. However, the results of monitoring in which the standard performance of programmes is measured should also be fed back to policy formation. Evaluation, in which dead-weight, substitution effects and other factors are also taken into consideration, offers a more profound assessment of programme impacts than monitoring does and thus affects policy formation more strongly than does monitoring.
However, monitoring should leave to evaluation only those indicators that cannot be observed directly and regularly. A relatively simple monitoring system will allow for a national/regional/local breakdown in order to facilitate comparisons between agencies. For any given programme at any given administrative level such a system should at least be based on the regular (monthly, quarterly) observation of:
1. the budget allocated and the resources spent (breakdown by spending categories, target groups and target sectors if appropriate);
2. planned participation and actual participation (breakdown by target group and target sectors if appropriate);
3. costs per head (per hour) on the basis of 1 and 2 and breakdown by spending categories, target group/sectors if appropriate.
Thus, monitoring systems would provide useful information on financial and physical take-up and costs, and under-performers could be detected by comparing regional/local units, although the differences in labour market conditions in local areas should be taken into account.
The indicators listed above allow the close monitoring of fund outflows and participation in relation to pre-set goals and permit comparisons of different constituencies and even of per capita costs between different measures. The indicators are therefore of greatest value to a programme administrator. They are basically input-output based and must, therefore, be supplemented by outcome-performance measures such as the employment status of the participants after participation or the skill levels achieved in training programmes (see Affholter, 1994).
Figure 1 also shows a link between labour market monitoring and labour market policy monitoring: results of LMP have an impact on the labour market and an ideal monitoring model must establish this link.
This article has drawn attention to some of the problems encountered in the current process of setting up LMP monitoring systems in the Member States of the EU, outlined the reasons why the monitoring of LMP performance is becoming more important, presented an overview of the state of the art of labour market policy monitoring in EU Member States and sketched out the functions of a monitoring system. While some countries have been engaged in monitoring for longer than others, most Member States are still in the process of installing such systems. Thus, the object of research still resembles a "moving target" and is difficult to grasp empirically. Some main trends have emerged, however. Monitoring should be tied to the routine administrative process of programme implementation and permit the combined observation of financial and physical indicators of LMP. In addition, monitoring should involve the continuous assessment of results. Ultimately, input (expenditure), output (participants) and outcome (performance) indicators are all essential elements of such monitoring systems and must be combined within the monitoring system.
It is surprising that administrative monitoring was not introduced earlier; but it seems that the spending of public money was not previously subject to such constraints. In two of the surveyed countries, it was precisely a lack of financial monitoring that led to problems with programme delivery. Consequently, one of the basic aims of monitoring systems is to allow a steady and controlled disbursement of assigned budgetary funds. Providing information on where public money goes and how the money can be allocated most efficiently for reaching pre-defined goals is, of course, a basic purpose of a monitoring system. The combined observation of money allocated/money spent and planned/actual participation by delivery area/sector and so forth is the core feature of any system for monitoring active labour market policy. These rather simple input/output data can be supplemented with results indicators to produce a comprehensive system of LMP observation that would allow agents at all levels to follow up LMP measures.
The fact that aspects of financial constraint currently seem to be the main focus of attention inevitably gives rise to the concern that the interest in efficient public spending will eventually mean that programmes will be evaluated primarily according to their immediate success (e.g. low per capita spending) and that this will be at the expense of longer-term and qualitative goals.
Experience with monitoring systems shows that monitoring of pre-set budgetary and participation goals does make it possible to improve the convergence of planning and actual outcomes. Moreover, it seems that if goals are set from the bottom up and if local agencies have a say in their establishment, the chances of achieving them are enhanced.
Although monitoring is in fact a "neutral" instrument, it seems, therefore, that the participation of those involved in monitoring in the setting of goals is important for the efficiency of the instrument. In the light of the experience with employment programmes in the United States, it seems that programme performance is enhanced if there is a built-in monitoring function. As formulated by the DOL (1994):
"Perhaps the most important lesson from our experience with using a performance driven management system is that local programs respond remarkably well to the required performance indicators. Once performance standards were implemented, employment rates and wage levels for individuals leaving the programme rose and continued to increase each year" (p. 1).
Thus, building in performance indicators in programmes is clearly a step in the right direction.
Monitoring implies the availability of indicators pertaining to all regional and local delivery areas and, hence, implies comparisons between them. It could thus enhance effective programme delivery. There is, however, the problem of pressure to harmonize LMP programme performance in areas that differ in their points of departure (in terms of target-group shares or the situation of the local economy, for example). That is, local adjustment of performance indicators is essential (see also Barnow, 1995). Sensitive data, for example, per capita cost, must be adjusted to take account of local variations.
In conclusion, clear-cut goals, clear financial and physical indicators of performance, concise statistics, appropriate time intervals of observation, feedback to guide the lowest level of the delivery organization, feedback to amend programmes in case of non-performance, incentives for good performers and increased local freedom to manage delivery would all form part of an optimal "package deal" and would pave the way to the efficient monitoring of LMP. Finally, a very important aspect of monitoring is acceptance: only a dialogue between the observers and the observed, especially when it comes to defining the goals to be set and monitored, is likely to bring about satisfactory results.
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