Delivering active labour market policy through vouchers: experiences with training vouchers in Germany

Abstract

In recent years, new public management has reached public employment services. This article analyses the use of training vouchers for jobseekers in Germany as a means of delivering active labour market policy. While vouchers are familiar in other fields of public services, the approach is completely novel in active labour market policy. The article contrasts the proclaimed advantages of vouchers in general (i.e. jobseeker choice and provider competition) with the problems of training vouchers in particular. Initial evidence suggests that information asymmetries, a lack of providers in certain areas and restricted opportunities for policy coordination are obstacles to full achievement of the positive effects hoped for by proponents of the training voucher. The article concludes that improving the existing contracting-out system may have been a better path to higher efficiency.