Temporary Employment Subsidy

HC Deb 16 March 1976 vol 907 cc1105-6

3. Mr. Gould

asked the Secretary of State for Employment how many jobs have been saved by the granting of the temporary employment subsidy.

Mr. John Fraser

As at 5th March, 23,133 jobs have been saved.

Mr. Gould

Given the success of this relatively modest scheme and bearing in mind the findings of some economists that it costs less to subsidise jobs than to pay unemployment and redundancy benefits, will my hon. Friend extend the scheme substantially, for example, by raising the amount of the subsidy?

Mr. Fraser

The proposition that it is cheaper to keep people at work than to pay them unemployment benefit has been in the forefront of our minds. The review of the temporary employment subsidy is a continuing one. We have already made changes in the scheme on three occasions in the light of experience and I do not rule out more changes in future.

Sir John Hall

In so far as the subsidy encourages employers to retain employees in excess of their production requirement, could it not lead to industrial inefficiency?

Mr. Fraser

It do not believe that to be so. It is defensible to try to keep people in employment rather than put them in the dole queue. One of the criteria for granting the subsidy is that the firm should have long-term viability. It may have to re-recruit skilled workers when it returns to full production. The scheme is fully justified.

Mr. Watkinson

Is my hon. Friend aware that here is still a lack of knowledge about this scheme among industrial employers? Is he aware that, as I go round my constituency, I find employers who are still in ignorance of the scheme? Will he therefore do his utmost to broadcast its merits to all employers?

Mr. Fraser

We shall see that the scheme is as widely known as possible. Hon. Members can always draw it to the attention of local employers, as I have done in my constituency.