There will be a greater role for the private and voluntary sectors in providing services to get people back into work, according to the Department for Work and Pensions’ Interim Commissioning Report.

Work and pensions secretary Peter Hain said that both sectors, working with Jobcentre Plus, had a vital role to play in achieving full employment and eradicating child poverty.

“If we are to meet this ambitious goal we need to take a fresh approach that utilises all the talent and skill available to us,” he said. “I believe our emerging findings will be supported across all sectors as being the right way to get people into work.

The report highlighted a number of areas going forward including: generating increased competition for contracts with support provided by the DWP for the encouragement of new service providers into the market; a large role for high-quality, high-performing smaller providers; and greater accountability for contracted providers.

The report was welcomed by Acevo, but with caveats. The umbrella group’s director of strategy and enterprise, Peter Kyle, said there were many good ideas in the report, but also that many of them were not new. He said it was essential that the DWP now acted quickly to develop a precisely defined commissioning model and that it established “precisely how it intends to make the journey it has mapped out a reality”.

“The interim report makes clear that the DWP sees a ‘key role’ for the third sector, wants ‘diverse supply chains’, and wishes to engage with organisations of all sizes across the voluntary sector,” he said. “The question is how these goals are to be achieved through a procurement process based on the larger-scale, lower-cost contracts the department is committed to.”

Belinda Pratten, senior policy officer at NCVO, said: “NCVO has long argued that the aim of public service reform is to ensure that citizens and communities get the services they need and deserve. That requires a better understanding of how commissioning processes can achieve this aim and a more sophisticated understanding of the efficiency agenda, giving as much weight to effectiveness as it does to cost savings.

“We are pleased that this report highlights these issues. However we are disappointed that it has misinterpreted the Compact Code on Funding and Procurement: the Code was recently revised to take account of all forms of public funding and applies both to prime contractors and to sponsor departments.”

The DWP report follows the publication of findings from the independent inquiry commissioned by Acevo in September, chaired by Dame Mavis McDonald, looking into the DWP’s Pathways to Work contracting – which among other things concluded that a shift in government practice was needed in terms of commissioning.