Report on Alternative Outcome Measures: Temporary Assistance for Needy Families (TANF) Block Grant . Using outcome measures does not mean abandoning useful process measures, especially because of problems in attributing outcomes to program interventions.

It is not necessary to make an either/or choice between outcome-based performance measures and process measures, such as the work participation rate. Along with outcome measures, participation measures are useful for several reasons:

  • To maintain a level of federal direction over the types and hours of activities in which welfare recipients participate. The participation rate under TANF places a strong emphasis on actual work, whether subsidized or unsubsidized, and allows education, training, and job search to count only under strictly limited circumstances. At the July 1999 consultation, many state representatives and researchers spoke out in favor of continuing a participation rate, but expanding the range of allowable activities.
  • To ensure that a high percentage of recipients is receiving services. This is particularly critical now that welfare has become a time-limited program; if the mandatory work participation rates are not enforced, there is a danger that people will reach their time limits and lose cash assistance without ever having received services or the experience in work to help them move to self-sufficiency. Together, the participation rate target and the definition of which individuals are counted (e.g., whether recipients who are exempt from participation should be excluded from the calculation) determine what fraction of all recipients will be expected to be engaged in work-related activities.(7)
  • To give states some credit for engaging recipients in work-related activities even if, due to state economic conditions or the characteristics of the recipient caseload, they do not achieve the desired levels of outcomes (e.g., unsubsidized employment). It may take several years of services before the "hardest-to-serve" recipients can achieve unsubsidized employment and participation rate requirements can reward states for helping such recipients to achieve intermediate steps, such as participation in substance abuse treatment or community service employment.

Regardless of motivation, outcome-based performance measures and work participation rates are not mutually exclusive.

As our experience with the High Performance Bonus system has shown, implementing an outcome-based performance measurement system under TANF would not be easy, neither for those who would set the standards nor for those whose performance would be measured against them. As these conclusions indicate, it is important to proceed judiciously, with an understanding of the real-world limits of such a system as well as of its strengths. But, as Secretary Shalala said, speaking at the University of Michigan in 1997:

[B]y focusing on outcomes we do more than fulfill our moral obligation... we force ourselves to use scarce resources wisely; to develop objective standards that we can use to demand accountability; and to put ourselves in a position to achieve even better results in the future.(8)



7.  Note that the target participation rate will always be lower than the fraction of the caseload that is mandated to participate, because some recipients will inevitably be between activities, or noncompliant.

8.  Remarks by: Donna E. Shalala, Secretary of Health and Human Services, Fedele and Iris Fauri Memorial Lecture, University of Michigan, Ann Arbor, Michigan, September 18, 1997.