Managing Welfare Reform in New York City

Welfare reform was a spectacular success in New York under Mayor Giuliani despite the city’s history of liberal social programs and its huge, entrenched welfare system. The city reduced the numbers on welfare from 1,120,000 to 460,000 by changing the organizational culture, protecting against fraud, insisting on work first, adapting information technology, and contracting for job placement. The organizational culture was transformed by bold leadership that changed the welfare agency’s mission and goals, overcame internal resistance, and prevailed over politicians who had a vested interest in the status quo and the media that were opposed to welfare reform.
Welfare fraud was largely eliminated by dropping from the rolls those who were working and could not appear for in-person interviews, by fingerprinting recipients to catch those enrolled under multiple identities and those receiving welfare checks from other jurisdictions, by uncovering hidden income, by enrolling new applicants only after thorough investigation, and by tightening controls to prevent fraud by corrupt employees.
JobStat, a computer-based system modeled after the Police Department’s system used to track precinct activity, was developed to track the status of welfare recipients and to monitor the performance of the Job Centers, which were formerly called welfare offices. JobStat focused the attention of department personnel on performance indicators rather than on minutely specified rules. The Giuliani administration’s major contribution to national welfare reform was the creation of the only system in the country with large-scale, alternative work arrangements that was able to acculturate large numbers of the never-employed to the world of work.