Long-term Unemployment (Hansard, 29 November 1994)

§ 7. Mr. Pickthall
To ask the Secretary of State for Employment what plans he has to help the long-term unemployed find work.

§ 8. Ms Gordon
To ask the Secretary of State for Employment what plans he has to help the long-term unemployed find work.

§ Mr. Portillo
The Government's economic policies aim to create low inflation and sustainable growth, which will lead to more reductions in unemployment and more job creation. For some time, my Department's priority in helping to achieve that has been to give special help to people who are long-term unemployed. Long-term unemployment is now less than 1 million, the lowest figure for two years.

§ Mr. Pickthall
Unemployed people will have heard what the Secretary of State said and, I guess, will have believed it almost as much as he did. Does he recognise that 38 per cent. of total unemployment is long-term unemployment? In Skelmersdale, in my constituency, long-term unemployment is as high as 44 per cent.—more than 1,000 adults have been unemployed for over 12 months in one small town. Why do his Government refuse to consider schemes such as national insurance holidays or tax rebates to encourage employers to take on the long-term unemployed in order to relieve a town such as Skelmersdale of the social tragedy that long-term unemployment forces on it?

§ Mr. Portillo
Unemployment is west Lancashire is down by 25 per cent. from the peak. The hon. Gentleman is right to say that long-term unemployment in this country is about 35 per cent. of total unemployment; the average for the European Union is 42 per cent. If the hon. Gentleman looks around Europe and finds a socialist Government, he will find higher unemployment, higher long-term unemployment, higher youth unemployment and that unemployment has not been falling as it has been in this country. If there were a socialist answer to this question, presumably socialist countries would have delivered it.

§ Ms Gordon
Does the Minister agree that this country needs not only job seekers but job finders and that a change of name, another fiddle of the figures and another cut in benefits for which people have paid national insurance contributions for years will not solve the problem of long-term unemployment, especially for older people? Does he agree that the only solutions are effective Government job-creation policies, such as releasing the capital receipts of right-to-buy sales and other strategies outlined by my hon. Friend the Member for Lancashire, West (Mr. Pickthall)?

§ Mr. Portillo
No, the hon. Lady is wrong. The real answer is sustained economic recovery, which requires our pursuing vigorous and determined economic policies. I am sure that we shall see some more of that from my right hon. and learned Friend in his Budget this afternoon. Of course I believe that we should give special help to long-term unemployed people. That is why 1.5 million different opportunities are provided for long-term unemployed people during the course of the year. The hon. Lady is absolutely wrong to say that the solution to this problem is yet more borrowing and yet more Government spending. Her Government and Governments around Europe tried that, and it resulted in higher unemployment. We have pursued a sustainable recovery and unemployment is falling in this country.

§ Mr. John Greenway
Does my right hon. Friend agree that the private finance initiative is now the best way for us to create more jobs in providing the infrastructure that this country needs? Will he state why he thinks that private 1066 companies should invest in inefficient public services—a policy that appears to be advocated by the right hon. Member for Kingston upon Hull, East (Mr. Prescott)?

§ Mr. Portillo
It is quite extraordinary that the right hon. Member for Kingston upon Hull, East should have made such a suggestion. The inefficiency of the public sector has to be paid for by taxpayers and there is no reason why taxpayers should pay for inefficiency. It is not a good way to create employment. The way to create employment is to have sustained recovery. My hon. Friend is absolutely right to say that the private finance initiative can play an important part in providing infrastructure and I expect that the Chancellor will make some comments on that subject.

§ Sir Michael Neubert
Would not the all-important morale and self-confidence of those out of work be greatly improved if Her Majesty's official Opposition adequately recognised the reduction in unemployment over two years of almost 455,000, if they recognised adequately the high level of employment in this country, by comparison with most other European countries, and if they stopped denigrating the employment and training programmes, which are providing 1.5 million places this year, as my right hon. Friend has just mentioned?

§ Mr. Portillo
Yes, it must be very dispiriting to those who are looking for work to find that the Opposition are determined not even to acknowledge the fall in unemployment and to recognise, for example, that the Opposition have always opposed the creation of our youth training programmes. Indeed, the hon. Member for Peckham (Ms Harman), the new Labour spokesman, was busy criticising those programmes again the other day.
It is a massive deceit on the British public for the Labour party to pretend, as the Leader of the Opposition was doing the other day, that it can spend its way out of unemployment. We cannot spend our way out of unemployment. We can reduce unemployment if we follow a policy of low inflation and sustained recovery.

§ Mr. Chidgey
Is the Minister aware that fewer than one in five of the long-term unemployed who complete a training for work programme are able to find work and remain in it? Does he agree that it is time for a radical working benefits programme with benefits transferred to a training subsidy to ensure that unemployed people are given the high skills that they need to find productive and stable jobs?

§ Mr. Portillo
I agree that we should be flexible in our thinking about those matters, and I share the hon. Gentleman's dissatisfaction with the present level of achievement of training for work. If we are going to spend that much money from taxpayers' sources on training for work, we should be able to ensure that more people get jobs. The principal purpose of training for the long-term unemployed is to get them into jobs. We shall need to reorient our programmes to reflect that.

§ Mr. Alan Howarth
Has my right hon. Friend noted that, notwithstanding the Government's strenuous efforts to address the problem of long-term unemployment, 59 per cent. of men aged between 55 and 64 remain out 1067 of work? Does he consider that, in the circumstances of today's labour market, the terms of the jobseeker's agreement should be different for different groups? Is there not a risk that the requirement on those for whom work is not available to go through the motions of actively seeking work will become a somewhat humiliating feature of the claiming process rather than a contribution to the functioning of the labour market?

§ Mr. Portillo
No, I do not agree with my hon. Friend, on this basis: I believe that it is absolutely wrong to give up on any section of the population below the age 65 which has the opportunity to move into work. There is a fair amount of discrimination against those people and that is why I encourage the Employment Service to take particular steps to help some of the older men and women who have been out of work for a period of time. However, I believe that those people should be kept in touch with the labour market, and that the jobseeker's agreement is an important way of handling that.

§ Ms Harman
Does the Minister accept that many of the long-term unemployed lack the skills that they need to get a job? Is he aware that the Government's survey—"Skill Needs in Britain"—reports that a growing number of companies are complaining that they cannot expand because they cannot find the skilled workers that they need? When we have, at one and the same time, unemployed people who cannot get jobs because they lack skills, and businesses complaining about skills shortages, would it not be madness to make further cuts in the training budget?

§ Mr. Portillo
I welcome the hon. Lady to her new position and I look forward to continuing our fruitful partnership. However, I do not believe that her analysis of the question is as close to the mark as that of the hon. Member for Eastleigh (Mr. Chidgey), speaking from the Liberal Benches.
One of the problems with training for work is that we are getting quite a few people with qualifications, but we are not succeeding sufficiently in getting those people into work. If the hon. Lady thinks about it, I am sure that she will agree that the principal purpose of training long-term unemployed people is to give them jobs. That is the focus that I want to apply. Skills for those people are a way of getting them into work. We should not be satisfied just with giving them skills; we should concentrate on getting them jobs. That is what they want.