HC Deb 14 January 1999 vol 323 cc433-6
8. Mr. Dennis Skinner (Bolsover)

What new measures he plans to introduce to expand opportunities under the new deal; and if he will make a statement. [64043]

The Secretary of State for Education and Employment (Mr. David Blunkett)

So far, 201,000 young people have entered the new deal programme and 52,500 have gone into work. In addition, we have introduced a new range of initiatives that includes the skills shortage pilot programme. Employers are able to access three quarters of the total amount available in subsidy if they are prepared to provide up-front, concentrated skills training. Also, 100,000 young people will benefit from the new mentoring programme, and the 28 new deal pilot programmes will help 90,000 people aged over 25.

All those measures mean that we can contribute to the phenomenal change that has taken place in the labour market. They also put into a reasonable context the opinions of the pundits about this week's figures for the number of people going into work and for the unemployment rate.

Mr. Skinner

Can I suggest another idea to my right hon. Friend? He, like many Labour Members, will be aware that the local authority is often the largest employer in areas of high unemployment, so why not make more use of those authorities to implement the new deal? Unemployment is excessively high in some of the old colliery areas. Under the new deal scheme, new training centres could be established and run in co-operation with those local authorities. That would ensure that, in future, there would be people to mend the roads, repair the schools and so on. That would be a useful approach, and I hope that my right hon. Friend will take it on board.

Mr. Blunkett

My hon. Friend is right. In replacing the old skill centres, we must look imaginatively at how the national traineeships that we are developing this year and the modern apprenticeship programme can directly impact on the skills that young people need to get into work. I am happy to assure my hon. Friend that my Department will study the way in which the national traineeships and the Employment Service new deal can be linked to build on the success that we have achieved in the task that we face.

Since the Government came to office, we have halved the number of young people under 25 out of work, compared with the total that we inherited from the Conservatives. That total was 178,000, and is now down to 88,000. I am sure that Conservative Members, even without our new numeracy programme, can do the sums necessary to see that the total has been cut by 50 per cent. We will be able to do even more if young people acquire the skills and training that my hon. Friend advocates.

Mr. Paul Keetch (Hereford)

Does not the Secretary of State agree that, given the enormous resources that have gone into the new deal programme, it is important that the House can be sure that the scheme is working as well as the Government want it to? Does he recall that page 12 of the Government's specification for the new deal programme for young people aged between 18 and 24, tells potential contractors that at least 45 per cent. of people on options would move into subsidised employment? So far, that figure has totalled only 25 per cent. Does not that show that the new deal programme is not working as well as the Government hoped?

Mr. Blunkett

I am sure that that forecast was contained in paragraph 3 of page 12. However, I think that the hon. Gentleman has missed the crucial point, which is that the key to ensuring that the value-for-money precepts built into the new deal programme are achieved is that the programme has a target for unsubsidised employment. The gateway proposals on providing advice, counselling and social skills have enabled that target to be achieved and, in fact, exceeded. The latest figures show that we reduced the claimant count for that particular group by 5,000 in December alone.

Mr. Andrew Reed (Loughborough)

While I warmly welcome the fantastic news about the number of young people who are now in employment, does my right hon. Friend agree that it is crucial to bring on line as quickly as possible assistance for those over 25 and, in particular, for people in their 40s who find themselves unemployed? We must accept that manufacturing jobs are being lost. For example, at Ladybird Books in my constituency 200 people will lose their jobs and, as they have been working on machines that are more than 30 years old, it will be extremely difficult for them to find work. Can we ensure that assistance is given to them as quickly as possible, so that they do not have to wait to become long-term unemployed before they get help from the new deal?

Mr. Blunkett

I agree entirely that we need to be able to do that and I look forward to being able to expand on the pilot programmes that I mentioned, which will help 90,000 such individuals. It is a case not simply of the new deal, but of the whole programme from the Employment Service and the Department for Education and Employment, including the rapid response unit, which is moving in quickly where redundancies are declared, and working with the training and enterprise councils, employers and trade unions to ensure that we can immediately move those people into other opportunities for retraining or directly into jobs. Bearing in mind the fact that we face a challenge this winter, the success of that programme was exemplified in yesterday's figures.

Mr. Damian Green (Ashford)

The Secretary of State's claims for the new deal bear close scrutiny. In November, the Government said that they would spend £660 million in the coming financial year on the new deal. In December, the Minister for Employment, Welfare to Work and Equal Opportunities claimed for the first time, as he repeated this morning, that each new deal job cost £1,000. With the benefit of the numeracy programme, the Secretary of State should be able to work out that that means that there will be 660,000 long-term unemployed young people later this year. Either the Chancellor's economic policy is even more disastrous than I thought, or that £1,000 figure is complete nonsense. Which is it?

Mr. Blunkett

I was genuinely expecting more of an Oxford graduate.

Mr. Green

Answer the question.

Mr. Blunkett

I am about to do so. The calculations are sensible and take into account the fact that when someone gets a job he or she pays back into the Exchequer in tax and national insurance and thus contributes directly rather than drawing benefits. [Interruption.] It is no good hon. Members saying, "Ah!". Every time someone draws a benefit, he or she costs the state money. Every time someone pays tax and national insurance, it helps us to invest in stopping people being dependent on the state. New Labour stands for independence, dignity and self-reliance.

Ms Sally Keeble (Northampton, North)

Will my right hon. Friend join me to pay tribute to the staff of the Employment Service in Northampton, who have been taking new deal road shows round shopping centres, especially in places with a large number of single parents? They have done so jointly with staff from the Benefits Agency and have provided good advice and opportunities to single parents under the new deal programme. Will he ensure that such schemes are extended to other areas because they are an exercise in joined-up government, they provide real opportunities to lone parents and they also ensure that staff in Government agencies are encouraged to show initiative and imagination in the way in which they develop such programmes?

Mr. Blunkett

I certainly agree with my hon. Friend and I congratulate those staff in Northampton who have developed that programme and worked together to make it successful. The child care initiative and the forthcoming working families tax credit, together with the announcement that the Secretary of State for Social Security and I made yesterday, which builds on the enormous amount of work that my right hon. Friend the Minister for Employment, Welfare to Work and Equal Opportunities has done to draw up the gateway proposals, with advice, support, counselling and rehabilitation, will all contribute to making success a reality throughout the country.