§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. David Hunt.]12.53 pm
§ Dr. Edmund Marshall (Goole)
The necessity for this debate arises from a reference to Thorne jobcentre, which is in my constituency, in the report of the Rayner scrutiny of the employment services division of the Manpower Services Commission, which was published in May this year.
In part A of annex 12 to the report, Thorne is listed as one of 14 jobcentres which in 1981 incurred a high cost per successful placing of applicants in new jobs. Paragraph 6.30 of the report recommends that the employment services division should consider whether the continued operation of those jobcentres can be justified, or whether the cost of such premises can be reduced by modifying or resiting the centres.
My purpose is to demonstrate why there should continue to be a jobcentre at Thorne. The present premises are well sited on the main road through the town, in the main shopping area, not far from the unemployment benefit office. I saw the premises again for myself only yesterday. I am not aware of any more suitable premises for the centre in Thorne, and any savings which might be gained by moving to new premises would be offset by the cost of relocation.
To understand the necessity for retaining Thorne jobcentre, it is essential to know something of the local geography and economic position. The town of Thorne, which includes the community of Moorends around Thorne colliery, is a free-standing town with a population at the 1981 census of almost exactly 17,000, standing some 11 miles north-east of Doncaster and 10 miles southwest of Goole. It is an old market town with boat building activities associated with the Stainforth and Keadby canal, and it grew considerably in the inter-war years with the development of the colliery at Moorends. But production at that colliery ceased in 1956, since when there has been some industrial diversification locally but not enough to stem the steadily increasing total of unemployed persons living locally to find work, more and more Thorne residents have had to look further afield, to Doncaster and to Scunthorpe. But, in recent years, those sources of new jobs have tended to dry up as the country's economy has declined. A further catastrophic blow to employment opportunities at Thorne came with the closure in the middle of last year of the GEC Machines factory at Thorne itself, causing a further 424 redundancies.
It is not easy to measure the exact size of the unemployment problem at Thorne. Figures are published monthly by the Department of Employment for the whole of the Thorne employment office area, which coincides with the former Thorne rural district, including the civil parishes of Hatfield, Stainforth, Fishlake and Sykehouse, as well as Thorne. For that Thorne rural district, the number of registered unemployed residents rose from 748 in October 1973 to 1,515 in May 1979 and to 3,111 in June 1982. It is significant that the number of my unemployed constitutents in Thorne itself has more than doubled in the three years since the present Government came to power.
When it comes to interpreting these figures in terms of a percentage rate of unemployment at Thorne, the Department is unable to produce such a measure of the 1192 local economic problem on the grounds that Thorne is included in the Doncaster travel-to-work area and unemployment rates can be calculated only for such areas as a whole. This is because, whereas numbers of unemployed persons are totalled according to where they live, figures of employed persons are obtained by the Department according to where they work, so that percentage unemployment rates can be calculated by the Department only for areas which are to a large extent self-contained labour markets, with most employees living and working in the same area.
A year ago, 41 per cent. of working people with homes in the Thorne district worked outside that district, so the Department of Employment is not equipped statistically to state a rate of unemployment for Thorne itself. The reason that as many as 41 per cent. had to travel to work outside the Thorne district is that they could not find work locally. In this way, the very scarcity of employment locally helps prevent the Department measuring the problem accurately.
A more accurate measure of the level of unemployment has come to hand recently in the form of the first returns from the census held in April 1981. Those returns, which I have been able to obtain, relate to local government district wards. The Thome ward coincides with the parish of Thorne, including Moorends. As I have explained, that is a much smaller area than the former Thorne rural district, so the unemployment figures that I cited earlier are not directly comparable with the figures that I have obtained for Thorne parish for the census returns.
However, the accurate facts are that on census night in 1981 there were resident in Thorne parish 5,358 people of working age in full-time employment and 1,143 who were unemployed. That means that 17.58 per cent. of the potential working population living at Thorne were unemployed in April 1981 while the figure for male workers alone was 17.81 per cent. Those figures compare with the percentage rates of unemployment quoted by the Department for the whole Doncaster travel-to-work area in April 1981 of 13.5 per cent. overall and 14.3 per cent for males.
In other words, in April 1981 the unemployment problem in Thorne was about 4 per cent. worse than the average throughout the Doncaster area. Of course, the situation in Thorne has deteriorated sharply since April 1981, particularly with the closure of the GEC factory and its 424 redundancies. The number of unemployed people in the whole Thorne employment office area in April 1981 was 2,359, compared with last months's figure of 3,111, which shows an increase of 31.9 per cent. in 14 months. Applying such an increase to Thorne parish, I obtain a best possible estimate of the present percentage rate of unemployment at Thorne and Moorends as 23.19 per cent. That figure clearly demonstrates the magnitude of the problem in Thorne.
There is no doubt in my mind that the parish of Thorne needs to be designated a development area—like the adjacent Scunthorpe area—so that it can derive some of the benefits that accrue from Government aid to such areas. Recently I exchanged correspondence with Ministers at the Department of Industry and also with the Under-Secretary of State for Employment, whom I am glad to see on the Front Bench. It is clear that nothing less than Thorne's redesignation as a development area will improve local economic prospects. Given the level of unemployment in Thorne it would be completely heartless 1193 for the Government even to consider the suggestion in the Rayner scrutiny report that Thorne jobcentre should be closed.
I ask the Minister to take the earliest opportunity—an opportunity offered by this debate—to make it clear that the Government reject out of hand the suggestion that the jobcentre should cease to operate. The major weakness in the Rayner scrutiny of the employment services division is that it pays scant attention to the employment needs of areas such as Thorne. The tables in annex 12 to the report list the average register size for persons seeking employment at each job centre in 1981, but there is no reference to the percentage that those figures represent of the local working population.
The one criterion listed in part A of the table that appears to have been given most significance in the report is the average cost of a successful job placement. Of course, in an area such as Thorne the average cost is bound to be higher, because of the difficulty of finding placements. That makes the operation of the local jobcentre all the more necessary, not less. Measuring the value of a jobcentre according to how many jobs are filled is to put the cart before the horse. The harder it is to find jobs in an area, the more necessary is a jobcentre there. One does not close hospitals, for instance, because few patients happen to be cured. In such a situation more hospital facilities are needed.
The Rayner scrutiny report is more realistic in what it says about the need for a rural and small towns network of employment services division local offices, beginning in paragraph 6.36 of the report. In particular, I note the sentence in paragraph 6.37(i) which states:The lack of alternative recruitment mechanisms also means that the impact of Voluntary Registration on levels of jobseekers usage and registration is likely to be less in rural areas than in cities and conurbations".In many respects the area around Thorne retains rural characteristics, with much farmland and many open, uninhabited spaces. It is an old market town. Up to 1974 the local authority was a rural district council. Furthermore, paragraph 6.37(vi) of the report points out thatthe deterioration of public transport facilities in rural areas, and the sharp rise in transport costs over the last 5–10 years, has increased the importance of locating local offices within easy travelling distance of as many unemployed people as possible.".As part A of annex 12 shows, it is 10 miles from Thorne to the next nearest jobcentre—the one at Goole, which is in a different travel-to-work area. I have known unemployed persons living at Thorne applying for jobs at Goole being unsuccessful chiefly because they did not live in the Goole area.
In the other direction from Thorne it is 11 miles to Doncaster. Daily return fares from the centre of Thorne are 34p by bus and 40p by rail to Doncaster and £1.20 by bus and 92p by rail to Goole. The distances involved are comparable and the great differences in transport costs reflect the public transport policies of the county councils.
As the Rayner scrutiny report makes clear in paragraph 6.37(vi), the employment services division cannot pay the fares of unemployed people visiting a jobcentre other than for official interviews prior to submission to employers.
If Thorne jobcentre ceased to operate, it would be too much to expect the thousands of unemployed in the Thorne district to find their own way to make general inquiries at the jobcentres at Goole or Doncaster. I am told that in an 1194 average week between 600 and 800 callers visit the Thorne jobcentre. The attractive premises, which I saw yesterday, draw people in.
For all these reasons, any decision to close down the jobcentre at Thorne would demonstrate beyond all doubt that the Government could not care less about the welfare of the people of Thorne in my constituency. The Under-Secretary has the opportunity to show that Ministers still have some compassion. He can do that by nipping in the bud here and now the suggestion that Thorne jobcentre should cease to operate.
§ 1.9 pm
§ The Under-Secretary of State for Employment (Mr. Peter Morrison)
I welcome this debate, and it is right that the House should be debating the issues raised by the hon. Member for Goole (Dr. Marshall). His choice of subject reflects his careful and assiduous concern for the interests of his constituents. It is a concern with which I am well acquainted. From my point of view the debate provides the opportunity to talk not only about Thorne jobcentre but about what is happening in the Manpower Services Commission's employment service and the Government's approach to it.
I was already aware that the hon. Member takes a great interest in the unemployment problems of the Thorne area and especially in the statistics published by my Department about it. He has been in regular correspondence with both my Department and the Department of Industry on the subject and I wrote to him only this week taking up points that he made in a letter to my hon. Friend the Minister of State at the Department of Industry.
But today's debate is primarily about Thorne jobcentre and I have listened with interest to the hon. Gentleman's comments about the work of that office. I do not wish to bore the House by going over all the information that he has already provided. I wish rather to bring out what seem to be the salient features of the position and to put them in the wider perspective of the jobcentre service as a whole.
Thorne was one of the first jobcentres to be opened in 1973—one of the first to reflect a new concept that there should be an employment service, separate from the payment of unemployment benefit, provided in attractive and accessible premises, often in high street sites. There are now about 800 jobcentres, four-fifths of the offices run by the employment services division of the Manpower Services Commission.
Thorne is a relatively small office with six staff. Last year the average number of unemployed registrants on its books was about 2,740. During the year 406 vacancies were notified to the office and it placed 431 people. Of course, the office dealt with other business than the registering of unemployed people and placing them in vacancies notified by employers work such as that connected with our special programmes for the unemployed, but, as with all jobcentres, its bread and butter work is trying to fill employers' vacancies and trying to find unemployed people normal jobs. One further factor that we must bear in mind is that some of its current work will disappear later in the year as registration at jobcentres ceases to be a condition for the receipt of unemployment benefit. While use of the jobcentre may remain high, the unnecessary paper work associated with compulsory registration will go.
1195 The immediate occasion for this debate is the publication of the report of a review of the employment service set-up as part of the programme of scrutinies of Government activities for which Sir Derek Rayner is responsible. The report identifies Thorne as one of a number of offices whose future should be reviewed on the ground that the cost of each placing that it makes is markedly high in comparison with the employment service average. In Thorne's case, the figure is £137 for each placing made by the office as compared with a national average of £80. The review also recommends that some other offices should be reviewed for this and other reasons.
Before I talk about the review more generally, two points are relevant to what the review says about Thorne jobcentre. The first is that, at this stage, this and other recommendations made in the report simply have the status of recommendations. No decisions have yet been taken. The report has yet to be considered in detail by the Manpower Services Commission, which has the responsibility for running the employment service. Moreover, the recommendation in the case of Thorne is simply that there should be a review of its future. It is not a definite recommendation as to what should be done.
The second point is that the measure of performance that has caused Thorne jobcentre to be singled out with some other offices in the report is not a new one that the review team devised. It is one that, from the outset, the commission and the management of the employment service have used as an important factor in taking decisions about new jobcentre projects or making changes in existing arrangements. Of course, it has to be interpreted taking into account regional and local circumstances, but it is an indicator that the management of the service and the Government must take seriously.
I trust that all right hon. and hon. Members will agree that regular reviews and scrutinies of the public service activities of the sort that has just been carried out in the employment service are essential to good government. We need to ensure that taxpayers' money is used in the most efficient and cost-effective fashion, and in particular that there is no waste or unnecessary expenditure. We also need to ensure that what is provided by a public service and the resources allocated to it keep in step with the changing requirements. In the case of the employment service, large sums of taxpayers' money are involved. Its various local office services now cost about £150 million a year.
A good deal of the work of the employment service since it was set up as a separate organisation about 10 years ago has been well regarded, but there have been criticisms. It is no secret that the jobcentre programme has attracted adverse comment, particularly in the past few years when constraints on public expenditure generally have necessarily been tight. The Select Committee on Employment has on several occasions raised questions about the scale of expenditure on new jobcentres, particularly when set against other priorities in employment and training. However, it is fair to add that over the past few years the jobcentre programme has continued at a reduced rate with greater emphasis on more modest and economical standards.
On a more general level, labour market conditions are now very different from those prevailing in the early 1970s when the original decisions on the present shape of the 1196 service were taken. Similarly, the role of the service is changing. From this autumn one of the major requirements placed on the employment service will be removed—the registration for employment of all those seeking unemployment benefit. Against that background, the previous Secretary of State for Employment, my right hon. Friend the Member for Lowestoft (Mr. Prior), suggested, and the Manpower Services Commission agreed, that a further review of the employment service was called for.
The review team consisted of two civil servants with experience of work in the employment service and two people seconded from the private sector of industry and commerce. They were asked—I quote from the scrutiny team's terms of reference which I announced to the House on 8 December—to examine the organisation, methods of work and deployment of resources of the Employment Service and its relationship with other divisions of the Commission and with other public and private sector providers of similar or related services; to assess in the light of the implications of the introduction of voluntary registration and of the labour market conditions likely to obtain and the technology likely to be available over the next few years, what changes may be required in the general employment service which is provided in the public interest and how that service can be provided most effectively and economically and with maximum value for money, and to make recommendations accordingly".Naturally, as part of that remit the team looked at questions relating to the size and the disposition of the jobcentre network and the siting and premises costs of jobcentres and other local offices. In broad terms, the report concludes that the modernisation programme should continue, but makes a number of recommendations as to how that can be done more economically than hitherto.
The report also recommends further, more detailed reviews of some parts of the existing network of offices. As far as the future of individual offices is concerned, the review's report makes detailed proposals only as regards siting of local offices in certain conurbations—proposals based on field work carried out by the review team. For the rest, the review does not make firm recommendations for change but rather lists a number of offices that will need to be reviewed by the commission for various reasons. As I have said, these include a number, of which Thorne jobcentre is one, where the cost per placing secured is high.
Others recommended for review are those where the premises costs appear disproportionately high. In addition, the report identifies a number of the smallest local offices and recommends a two-stage review—either immediately or in some cases in 1983–84, after the experience of the introduction of voluntary registration and the likely resulting fall in business volumes. The review makes it clear, however, that the team's overall judgment was that a major closure of rural and small town offices would not be appropriate.
I have already made it clear that no decisions have yet been taken about the future of Thorne jobcentre. Nor will they be, until the commission has had a chance to form an overall view of the scrutiny report on the employment service. Even then, if it is decided to accept the report's recommendations, a decision on the future of this jobcentre will not be taken until the further detailed review recommended has taken place. It is already the practice of the commission to ensure when taking decisions about its local offices that there is an adequate opportunity for those concerned in the localities affected to have their say. I am 1197 sure that in considering the future of individual offices all the relevant considerations will be taken into consideration.
§ Mr. Harold Walker (Doncaster)
The Minister has said that those in the localities that are affected will have a chance to express their views. Will he bear in mind that when a jobcentre is scheduled for possible closure there will be an effect on the particular location and on the other offices that presumably will have to take on the work that was carried by the office scheduled for closure? I assume that the work presently undertaken at the Thorne office will be transferred to the Doncaster office in my constituency.
Will the Minister bear in mind also that the House should have a chance to express a view on these matters after the MSC has reached its conclusions and before the Government make their decision? Many hon. Members may have constituency interests, but the efficiency of the employment service is something on which we would all have views, especially its effect on the performance and efficiency of the economy overall.
§ Mr. Morrison
I am delighted that the right hon. Gentleman is in his place. He is a shadow employment Minister and he has a constituency interest. His constituency and that of the hon. Member for Goole (Dr. Marshall) adjoin. There will be an effect on other jobcentres in the area if a jobcentre closes or if an additional office is opened. The right hon. Gentleman will know from his long experience that the employment services division of the Manpower Services Commission will always put things in context rather than treat each 1198 issue on an isolated basis. I am sure that we both want that to continue and I can give him the assurance that it is my view that it should.
I agree with the right hon. Gentleman that the way in which the service is run is of extreme importance. That is how I regard it as the Minister responsible for it. Importance must be attached to how it is run and to how much is spent upon it. I want to ensure that it is run in the most cost—effective fashion. However, I listened carefully to what the right hon. Gentleman said.
I was saying that I have no doubt that this will involve not only the important questions of the performance and cost-effectivness of the offices as currently staffed and organised but other issues identified in the report, such as the patterns and cost of transport for job seekers and location of other offices. The hon. Member for Goole raised the subject of transport costs in his remarks.
At this stage, however, I do not wish to prejudge or prejudice the commission's consideration of the report. The commission will be reporting its conclusions in due course to my right hon. Friend the Secretary of State for Employment, and he and I will consider its views with great care and attention, not least those on jobcentre siting policy and on the overall extent and shape of the local office network.
I have no doubt that the hon. Member for Goole and other right hon. and hon. Members will continue to take an active interest in the implications for their constituencies of the decisions that are eventually taken. I welcome this, as I welcomed the opportunity provided by this afternoon's debate to discuss the issues involved.
§ Question put and agreed to.
§ Adjourned accordingly at twenty-five minutes past One o'clock.