EMCC European Monitoring Centre on Change

Joint Fashion Industry Teams, United Kingdom

About

Country: 
United Kingdom
Sectors: 
Textiles and Leather
Target Groups: 
employers/purchaserssectoral organisationsworkers/suppliers

 

The creation of Joint Fashion Industry Teams (JoFITs) targeting the clothing and fashion industry was intended to facilitate greater cooperation across central government departments at the operational level. These area-based teams brought together civil servants from the Department for Work and Pensions (DWP), Her Majesty’s Revenue and Customs (HMRC) and the Jobcentre Plus government agency to combat undeclared work in the clothing and fashion industry.

 

Background

In 2000, a review of how the UK government was tackling undeclared work identified the lack of joined operations across central government departments as a problem (Grabiner, 2000). To facilitate greater cooperation across central government departments at the operational level, the ‘Grabiner Steering Group’ – now renamed the Informal Economy Strategy Group – established a range of joint operations on a sectoral level. One of these measures was the creation of Joint Fashion Industry Teams (JoFITs) targeting the clothing and fashion industry. These area-based teams brought together civil servants from the Department for Work and Pensions (DWP), Her Majesty’s Revenue and Customs (HMRC) and the Jobcentre Plus government agency to combat undeclared work in the clothing and fashion industry. Furthermore, civil servants from the Health and Safety Executive (HSE) were also involved in the initiative which ran over the period 2000–2006.

JoFITs operated on an area-based level and mainly targeted workers, employers and sectoral organisations in the clothing and fashion industry. The first JoFIT team was located in London and a second team was established in Leicester in the East Midlands area in 2001.

Objectives

When the Paymaster General, Dawn Primarilo, launched the JoFIT teams in August 2000, their aim was to provide a service to business, reduce fraud and improve regulatory understanding and compliance in the fashion industry through a multi-agency approach.

Specific measures

  • teams aim to raise regulatory understanding and compliance within the fashion industry through:
  • educating and working with the industry’s traders;
  • joint visiting of companies;
  • tackling fraud by detecting
    • ‘unregistered businesses’ – these are legitimate businesses which trade above the value-added tax (VAT) threshold of £64,000 (€86,452 as at 31 January 2008), but which deliberately do not register for VAT with the relevant government department
    • ‘moonlighters’ – individuals who formally work and pay tax, but who have a second hidden job for which they do not pay tax
    • ‘ghosts’ – individuals who are completely unknown to the tax authorities as they do not carry out any formal work and hence do not pay any tax on employment or self-employment income sources, although their earnings are sufficient to do so
    • false benefit claimants;
  • multi-agency information and data sharing on an operational level.

Evaluation and outcome

Achievement of objectives

No evaluations of JoFIT teams have so far been published.

Obstacles and problems

A major operational problem of these JoFITs related to the fact that, although there was a single management of the teams, the individual civil servants employed in each team depended on separate performance measurement systems and pay structures. The performance of DWP employees was assessed on the basis of the number of false benefit claims detected and that of HMRC employees on the basis of the amount of additional direct and indirect taxes secured. Although the JoFIT statement of measures emphasised the joint contribution to targets, the objectives remained separate for each department involved in these joint operations.

Lessons learnt

JoFITs demonstrated that it is feasible for departments to work together on an operational level in areas of shared risk. The co-location or coming together of employees from different departments in area-based teams also resulted in them working around problems such as incompatible information technology (IT) issues.

Impact indicators

The only data available on the outcomes of JoFITs are combined with the results of another initiative, the Multi-Agency Team (MAT) experiment based in Wolverhampton in the West Midlands which was set up in October 2000. The 2003 report to the Select Committee on Public Accounts highlighted that, as at the end of February 2003, both JoFITs and MATs had recorded 34 sanctions, 78 adjustments to social benefits and 47 overpayments. In addition, two collusive employers had been prosecuted. The total value of adjustments to social benefits and overpayments amounted to almost £80,000 (€107,690).

The only other piece of evidence on the initiative’s impact derives from the Low Pay Commission (LPC). The latter reported that, in 2002–2003, the Inland Revenue expected to deal with about 100 JoFIT-sourced cases in relation to breaches of minimum wage legislation.

No information is available concerning the estimated costs and benefits of the programme.

Transferability

This scheme which sought to join-up the detection work of different government departments in the fashion industry is transferable to other countries where no one government department is wholly responsible for tackling the issue of undeclared work. It is also transferable to other sectors of the economy and beyond its local area-based approach to the regional and national levels.

Commentary

Using schemes like JoFITs to join-up the operations of government departments is only relevant in countries where responsibility for tackling undeclared work is not concentrated within one government department or agency. The fact that this scheme does not appear to have been evaluated, in order to determine whether joining-up government departments at the operational level provides value-for-money, reflects a broader common tendency – that is, not to evaluate or report on the efficiency and effectiveness of the various initiatives taken to curb undeclared work. This scheme ended when the extra funding instigated by the Grabiner review came to an end. This outcome displays, to a certain extent, the lack of commitment in UK central government bodies to a ‘joined-up’ working approach and their preference for an approach based on conventional departmental divisions.

Contacts

Main organisation responsible: Her Majesty’s Revenue and Customs (HMRC), Department for Work and Pensions (DWP) and Jobcentre Plus

Website: www.hmrc.gov.uk

Bibliography

Grabiner, Lord, The informal economy, London, HM Treasury, 2000.

Inland Revenue, Spring departmental report: the government’s expenditure plans 2004–2006, London, Inland Revenue, 2004.

Low Pay Commission, The national minimum wage: fourth report of the Low Pay Commission: building on success, London, Department of Trade and Industry (DTI), 2003.

Select Committee on Public Accounts, Minutes of evidence: supplementary memorandum submitted by the Department for Work and Pensions (DWP), London, Parliament, available online at: http://www.publications.parliament.uk/pa/cm200203/cmselect/cmpubacc/488/3030318.htm (last accessed on 31 January 2008).

Colin C. Williams