HC Deb 08 November 2001 vol 374 cc354-6
4. Gillian Merron (Lincoln)

What plans he has to extend the new deal to assist long-term unemployed people to find work. [11329]

(Mr. Gordon Brown)

Since spring 1997, long-term unemployment has been cut by two thirds.

From April 2001, as part of our continuous improvement in it, we have intensified the new deal for the long-term unemployed with our employment action teams and with the extension of employment zones

. Further help for the unemployed will be part of the discussion that will arise from the pre-Budget report, which I can tell the House will be on 27 November.

Gillian Merron

May I draw my right hon. Friend's attention to the experience of my local employment service, which has used the new deal to help about 2,400 people into work in Lincoln, but whose experience tells it that to assist small numbers of long-term unemployed people, or perhaps even those who have never worked, it is more expensive to provide training and support? I call on my right hon. Friend to take account of that in the pre-Budget report to ensure that we have the new deal funded and catering properly for those who are the hardest to help into work.

Mr. Brown

I am grateful to my hon. Friend. What has been done in her constituency and other constituencies can indeed be extended so that we can help those young people or adults who, for some reason or other, have fallen through the net and remain long-term unemployed. I am obviously in discussions with the Secretary of State for Work and Pensions; we are trying to look at measures for areas where there are real problems that have still to be dealt with. It is time to consider the way in which we can extend the new deal and match what we do for people in long-term unemployment with what we are doing with Ambition IT, Ambition Finance and Ambition Construction; those initiatives meet the needs of employers by helping long-term unemployed people obtain the skills needed for the jobs that are available.

Mr. Michael Jack (Fylde)

The Chancellor may be aware that yesterday at 1 o'clock in my Fylde constituency, Snackhouse savoury snacks manufacturing business went out of business with the loss of 400 jobs. While we have had excellent support already from the Employment Service and the North West development agency, may I seek his assurance that, in spite of what his right hon. Friend has just said, he will re-examine, before 27 November, the costs that companies such as Snackhouse have had to bear as a result of new business costs such as the climate change levy, new employment legislation and domestic rises in local taxes? Companies such as Snackhouse needed help; so will their successors. Will the Chancellor assure me that he will look again at costs for business?

Mr. Brown

Of course I sympathise with the right hon. Gentleman and his constituents who have lost their jobs. These have been difficult times for many businesses, particularly in the manufacturing sector. When there are substantial redundancies, he should know that rapid response teams are brought in by the Department for Work and Pensions, and the relevant regional development agency, as he rightly mentioned, puts itself at the service of the company and employees looking for jobs.

The way to deal with the problems that are faced is to run the correct monetary and fiscal policy. It should be noted that, this morning, the Bank of England announced that it is cutting interest rates by a further 0.5 percentage points; it is adopting a pre-emptive policy. Seven interest rate cuts have now been announced this year. The Bank of England adopted a pre-emptive approach in 1998 when there was a slowdown in the economy; it is doing exactly the same now. I believe that the cut will be warmly welcomed throughout the country. As for individual measures, we have cut corporation tax and small business corporation tax; we have cut capital gains tax from 40p to 10p for business assets for more than two years. We are introducing the necessary taxation measures; for small businesses, we are removing the responsibility for audit, and allowing them to submit one set of accounts to the Inland Revenue, not two. We are also introducing a package of deregulatory measures that will simplify VAT for the smallest businesses in the country. In all those areas, despite what the right hon. Gentleman said, we have been cutting taxes for business.

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