HC Deb 11 December 1997 vol 302 cc1177-9
12. Mr. Colman

What steps he is taking to involve small and medium enterprises in the new deal for the young unemployed.[18758]

Mr. Andrew Smith

The involvement of small businesses is critical to the success of the new deal.

We are winning their involvement through direct contact at local level, through organisations representing SMEs such as the Federation of Small Businesses, the Forum of Private Business and chambers of commerce, and through sectoral organisations and trade associations, for example in construction and tourism. There will be advertising and an intensified local marketing effort in the new year, but already 9,000 employers have told us that they are committed to the new deal; my hon. Friend the Member for Putney (Mr. Colman) will be pleased to know that 70 of them are in Putney.

Mr. Colman

I thank my right hon. Friend for his response. An article in yesterday's Financial Times said that companies are flocking to sign up to the welfareto-work scheme. More than 50 of the largest companies in the United Kingdom were mentioned in the article. As the Federation of Small Businesses, which has 100,000 members, supports the welfare-to-work proposals, as my right hon. Friend said, and as most new jobs will be coming through SMEs in the future, will my right hon. Friend ask local employment services and local government offices to give publicity—in the same way as was done in the Financial Times yesterday—through local newspapers and the local media to examples of companies flocking to sign up in our constituencies?

Mr. Smith

That is a good idea and it is precisely that sort of local marketing—to which I referred—that will be taking place in the new year. We are seeing a growing recognition that the division and corrosion of our communities that are caused by youth unemployment will be solved only through partnership efforts that bring everyone together—local communities, local authorities and local businesses. The level of commitment that we are now seeing shows that they recognise the benefits to business both of getting young people in touch with the world of work and of their being able to enjoy its opportunities and face the responsibilities that go with it. The new deal is good news for businesses as it helps their recruitment effort at a time of growing skill shortages by equipping people and training them to get a job and stay in it.

Mr. Ian Bruce

I am sure that the Minister is well aware that many of the schemes that have been tried in the past, both here and overseas, have had the problem of substitution—where employers who were going to take someone on anyway take on someone on a subsidy. As it is to be a six-month scheme starting in April, will the Minister take care to ensure that the tourism industry does not simply decide to use the Government's money—the Treasury's money, the people's money—to subsidise people who would normally be taken on for a six-month period, giving them little in the way of training and thus doing away with all the jobs that would normally be taken by students who try to work during the summer so as to be able to afford to go to university?

Mr. Smith

The truth of the matter is that now is exactly the right time to introduce a programme such as the new deal, because of the level of unfilled vacancies across the country—320,000 at the last count. That is whole point of the new deal: it can equip young people who would otherwise not have the opportunity to apply for and fill those jobs to do so. It is therefore good for the economy as well as for those young people's future.

Mr. Derek Foster

My right hon. Friend is to be congratulated on the extent to which the big global players have signed up to support the new deal, but he will be aware that in most of our constituencies—certainly in some rural areas or in inner-city areas—it will be crucial to get large numbers of small and medium-sized enterprises. The Minister has given us some good news today, but my impression is that a great deal of work still needs to be done before we can be confident that sufficient numbers will be achieved. Will he ensure that the quality of training in that option is as high as it must be to deliver what young people need and deserve?

Mr. Smith

Yes, indeed. My right hon. Friend is entirely right. I met the head of the Basic Skills Agency this morning precisely to ensure that the monitoring and quality assurance of training under all the new deal options ensures that the training given is of the highest standard. I congratulate my right hon. Friend on the work that he, too, is doing to encourage small firms to sign up to the new deal and recruit the young unemployed; indeed, such work is an important opportunity and the responsibility of all right hon. and hon. Members. I referred earlier to the importance of partnership in getting the young unemployed back to work; we all have a task to perform in our own communities to help to get businesses on board and open up the opportunities that the young unemployed need.