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Title page 1

Contents 5

Foreword 4

Glossary of acronyms 7

Executive summary 9

1. Overview of contracted-out employment service models in Italy 11

1.1. Introduction 12

1.2. The evolution of contracted-out employment services 12

1.3. Getting to GOL: Past and ongoing contracting models 15

1.4. Contracted-out employment services provided under the GOL programme 17

1.4.1. Financing 19

1.4.2. Target groups and process of assigning participants into service streams 20

1.4.3. Market structure 24

1.4.4. Criteria for providers to participate in the market for employment services 27

1.4.5. Participant-provider matching 29

1.4.6. Payment model 30

1.4.7. Service provision and requirements 33

1.4.8. Managing the public-private co-operation 35

1.4.9. Participation and outcomes 37

References 40

Notes 42

2. Key success factors and challenges in current system based on lessons from other countries 43

2.1. Introduction 44

2.2. Modern contracted-out employment programmes: Lessons from across the OECD 44

2.3. Positive features and success factors 46

2.3.1. Common GOL framework 46

2.3.2. Flexibility for regions to adapt the programme 46

2.3.3. Ambitious targets for participation combined with strong advertisement and outreach campaign 47

2.3.4. Combination of process and outcome-based payments 47

2.3.5. Enhanced IT platforms and digital tools 48

2.3.6. Collaboration between employment services and social services 48

2.3.7. Diverse network of providers offering potential for specialised services that meet clients' and employers' specific needs 49

2.4. Challenges and bottlenecks of current models 49

2.4.1. Using counterfactual impact evaluations to learn and guide policy development 49

2.4.2. Simplifying provider reporting and strengthening their monitoring of providers 50

2.4.3. Improving jobseekers' ability to make a deliberate and informed choice 51

2.4.4. Managing efficiently the resources available to some CPIs would help alleviate capacity shortages 55

2.4.5. Using profiling tools to streamline jobseekers' customer journeys and refocus the work of CPI counsellors 55

2.4.6. Long placement periods risk having jobseekers get "lost" in the system, especially for vulnerable clients 57

2.4.7. Operational safeguards such as minimum service requirements and stronger engagement from CPI counsellors would... 58

2.4.8. Strengthening co-creation of key programme parameters through better engagement with employment service providers 60

2.4.9. Refining the payment models could better incentivise providers and account for regional differences 61

2.4.10. Ensuring stable funding and service continuity 64

References 65

Note 67

3. A new model of contracted-out employment services 68

3.1. Introduction 69

3.2. Building a robust framework for contracted-out employment services 69

3.2.1. Ensuring stable funding and service continuity 70

3.2.2. Strengthening engagement with providers 71

3.2.3. Operational safeguards in the form of minimum meeting frequencies 73

3.3. Improving efficiency and targeting 74

3.3.1. Simplifying reporting for providers 75

3.3.2. Streamlining customer journeys and refocussing CPI work through a digital-first approach 77

3.3.3. Introducing interim outcomes as guardrails for the most vulnerable groups 79

3.3.4. Ensuring adequate resources for CPIs (optional) 80

3.4. Strengthening providers' incentives, accountability and performance 81

3.4.1. Refining the payment models 81

3.4.2. Improving jobseekers' ability to make a deliberate and informed choice 84

3.4.3. Strengthening monitoring of providers 86

3.4.4. Developing a counterfactual impact evaluation ecosystem 88

3.5. Diagrams of the proposed new model 91

Reference 95

Notes 95

4. Implementation plan 96

4.1. Introduction 97

4.2. Roles and responsibilities 97

4.3. Implementation timing 101

4.3.1. The model should be piloted over the course of 2027 and 2028 102

4.3.2. IT and legal development can run in parallel to model piloting 103

4.3.3. Supporting framework from policy conception to nationwide delivery 104

Annex A. Additional information for new model 105

Reference 107

Tables 6

Table 1.1. National UCS payment levels for training differ by instructor's relevant experience 33

Figures 6

Figure 1.1. Italy faces multiple challenges in labour market governance 14

Figure 1.2. Ambitious GOL targets require high intake 18

Figure 1.3. Majority of GOL participants are placed into Pathways 1, 2 and 3 19

Figure 1.4. Participant journey through the GOL programme 22

Figure 1.5. Qualitative profiling scores determine participant pathways 23

Figure 1.6. Distribution of participants by public and private provider differs by region and pathway 26

Figure 1.7. Outcome-based payments in GOL are relatively low in practice 32

Figure 1.8. Maximum number of service hours differs by the pathway 34

Figure 1.9. GOL programme uptake varies by region 37

Figure 1.10. Employment outcomes of GOL participants largely reflect differences in local labour market conditions 38

Figure 1.11. Employment outcomes are stronger for participants of Pathway 1 39

Figure 2.1. Sweden's rating model rates providers based on client outcomes after accounting for client characteristics 53

Figure 2.2. Outcome-based models provide financial incentives for longer-term placements 63

Figure 3.1. The model proposes a digital-first approach with several safeguards 92

Figure 3.2. The new model would strengthen jobseekers' choice and the accountability of both providers and jobseekers 93

Figure 3.3. The payment model would introduce additional outcome-based payments 94

Figure 4.1. The new model is designed to have consistent feedback and information flows between elements 98

Figure 4.2. A pilot can be rolled out over the course of 2027 to inform wider roll-out 102

Boxes 30

Box 1.1. Veneto's provider rating system 30

Box 2.1. Arbetsförmedlingen uses ratings to guide participant choice 53

Box 2.2. Australia's Provider Performance Rating System under Workforce Australia 54

Box 2.3. Workforce Australia Online - A Digital-First Service Model 56

Box 2.4. The Netherlands and Australia both use smaller outcomes to incentivise providers working with participants with complex needs 58

Box 2.5. "Black box" contracting has led to concerns that some participants are left behind 59

Box 2.6. Industry groups have the potential to spearhead improvements: ReAct partnerships in the United Kingdom 61

Box 2.7. Performance-related payments vary according to their context 63

Appendix Tables 6

Table A A.1. Proposed changes to payment model 105

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