Private sector operators of the Government’s new JobPath scheme are to be paid a sequence of “job-sustainment fees” based on the length of time they keep people at work.

The programme, which targets the 164,000 long-term unemployed people on the Live Register, has been controversially outsourced to two recruitment firms.

Turas Nua and Seetec will be paid an initial registration fee for signing up candidates and then up to four "job-sustainment" fees – paid retrospectively for each 13-week period of accumulated employment of at least 30 hours a week.

The fees agreed at each stage have not been disclosed but they will take into account the length of time candidates has been without work.

The staggered payments are designed to ensure the firms remain incentivised to find people sustainable jobs.

A Government spokesman said the overall cost of the programme would be determined by the number of people who participate.

“JobPath is a payment-by-results model, which means that companies will not be able to fully recover their costs until they place sufficient numbers of jobseekers into sustainable jobs,” he said.

Depending on the number of referrals, the programme is expected to cost the Government€200 million to €340 million over six years.

The Government hopes it will make savings on jobseekers’ payments of€315 million to €525 million.

Critics of the Government’s decision to bring in private recruiters claim the programme is vulnerable to “creaming and parking” whereby contractors cherry-pick jobseekers with better prospects.

In Britain, private welfare-to-work firms earn up to €19,000 for getting long-term claimants back to work.