5 Ways Waivers Will Strengthen Welfare Reform

Despite mounting complaints from conservatives, the Obama Administration’s announcement yesterday that it will give states waivers to run demonstration projects in their TANF programs will not kill or undermine welfare reform.  Indeed, it will strengthen welfare reform by giving states greater flexibility to test more effective strategies for helping recipients prepare for, find, and retain jobs — and measure their accomplishments in more meaningful ways than the current system allows.

The conservative complaints are ironic, to say the least.  For one thing, they beg an obvious question:  why would anyone oppose efforts to merely test whether there are better ways to connect people to jobs?  For another, the complaints are coming from some of the same people who usually argue for giving states more power to run programs and who often seek state waivers in other programs.

The plain fact is that these demonstration projects will strengthen welfare reform and the ability of states to move parents from welfare to work.  Here are five reasons why:

1. Approved demonstration projects will have an explicit and intentional focus on improving employment outcomes. In its waiver announcement, the Department of Health and Human Services (HHS) notes that demonstration projects approved will be “focused on improving employment outcomes” for participants.  This is a major step forward.  Under the current structure, states can meet their TANF work participation rate – the only measure of state performance – without recipients finding paying jobs.  These demonstration projects will help to shift the focus of TANF employment programs from process and “bean counting” (whether recipients participate in programs) to outcomes (whether they actually find and keep jobs).
2. The demonstration projects will be built around a strong and transparent accountability framework that will help to build knowledge for the future. In its announcement, HHS makes it clear that it will hold states accountable for alternative performance measures.  States will be required to set measures against which their progress will be measured and will face consequences for not meeting them, including possible termination of the waiver.
3. States will be able to make more effective and efficient use of limited resources. TANF directors often say that they spend too much time tracking hours of participation and not enough time helping recipients find jobs.  Through waivers, states will be able to develop new and more efficient systems for measuring participation and progress and will be able to target program activities to recipients with the greatest need for assistance in securing and retaining employment.  This is a welcome departure from a system that often spends too much on families that could easily find employment on their own and too little on families that face substantial employment barriers.
4. States will be able to focus more on building a better skilled workforce. Many TANF recipients have limited skills and low levels of education, leaving them with few employment prospects.  The current TANF work requirements do little to encourage and support investments in education and training.  Waivers will give states more flexibility to build education and training opportunities that are consistent with the labor market requirements of their communities, creating a win-win for TANF recipients and employers.
5. States will have greater flexibility to align their TANF employment programs with other employment, training, and education initiatives. The TANF work requirements are very narrowly defined and often are inconsistent with the requirements in other job training and employment programs.  If HHS allows states some flexibility to increase the effectiveness of their TANF work programs and activities, states will be able to maximize coordination among TANF and other programs including the Workforce Investment Act, Adult Education, and Vocational Rehabilitation.  This will help to streamline programs and make it easier for unemployed parents to be served by the program best suited to help them secure and retain employment and increase the effectiveness of the bigger employment and training system.

Waivers have led the way for more effective policies in many arenas.  The time is right for a new round of knowledge-building in TANF.  It is time for fresh ideas that can help to build a better future for our next generation of workers.