HC Deb 15 July 2004 vol 423 cc1535-7
6. Mr John McFall (Dumbarton) (Lab/Co-op)

What representations he has received on his measures in the pre-Budget report to help people into work. [184075]

11. Ian Stewart (Eccles) (Lab)

If he will make a statement on the effect on the economy of present employment levels. [184081]

The Chancellor of the Exchequer (Mr. Gordon Brown)

With unemployment low and the economy growing, the pre-Budget report will report on the new deal for skills and how we can help people to obtain the skills that are necessary to fill the 600,000 vacancies in the economy. That will require us to maintain, not abolish, the new deal.

Mr. McFall

What progress is being made on the new deal for the over-50s, where unemployment is still comparatively high? Mindful that there are 630,000 job vacancies, what measures is my right hon. Friend taking in the tax and benefits system, which in the past has acted as a disincentive to unemployed people moving into work?

Mr. Brown

There will be some worry for Conservative Members about unemployment among the over-50s after the next general election, and the new deal for the over-50s will be of great help to them.

Of the 1.8 million new jobs that we have created since 1997, almost half have gone to people over 50, so it is not the case that people over 50 have not been offered jobs or taken them up It is true, however, that a large number of people over 50 still, for a variety of reasons, do not find that the tax and benefits system has helped them as it might. That is why we introduced the new deal for the over-50s and special incentives through the new deal for the over-50s, and why we will continue to address the issue in order to move towards full employment. I have to tell the House, however, that we could not move as fast or as far to full employment without the assistance of the new deal, so the Conservative party should reconsider its decision to abolish it.

Ian Stewart

Is my right hon. Friend aware that the Labour Government's creation of a stable economic climate and their commitment to public expenditure has led to record low unemployment in Eccles, which is 46.6 per cent. lower than it was in 1997? Does he agree that that forms the bedrock for new investment in Eccles where, for example, Salford City Reds rugby league club has plans for a new stadium and associated development which, with the help of measures outlined in the pre-Budget report, will create about 2,000 new jobs? By the way, we have plenty of brownfield sites for public servants.

Mr. Brown

I am grateful to my hon. Friend. The progress made in tackling unemployment in his constituency is most welcome. Although the new deal finances many things, it does not yet finance stadiums. but I hope that progress can be made both on sporting facilities and on raising employment levels in his constituency. The fact is that, without the new deal, more people would be unemployed today. Even in the constituency of the shadow Chief Secretary unemployment has been reduced from 2.7 per cent. to just 1 per cent. under a Labour Government, so how can he say that the situation is analogous to what happened in the late 1920s and early 1930s?

Mr. Nigel Evans (Ribble Valley) (Con)

Is not the Chancellor worried about employment levels in manufacturing industry, because there have been a great many job losses in manufacturing throughout the country over the past seven years? Does he take any responsibility for that, following the introduction of the climate change levy?

Mr. Brown

I notice that the Conservative party is now promising to abolish the climate change levy and the aggregates levy, so it must have the means to replace that income. As far as we are concerned—[Interruption.] It is revenue neutral only because we reduced national insurance as a result of it. Presumably, if the Conservatives abolished the climate change levy, they would increase national insurance. Is that another commitment by the shadow Chief Secretary and the shadow Chancellor?

Mr. Dennis Skinner (Bolsover) (Lab)

Is the Chancellor aware that the project that followed the £24 million that he gave us for flattening the Shirebrook pit tips has been completed, and there is a prospect of 2,000 jobs on that business park? That is one reason why coalfield unemployment has gone down. The Markham Bolsover employment zone, which has received the first £15 million of the funds that it needs, will give rise to 5,000 jobs. I urge my right hon. Friend to remember the site, which is located at junction 29A of the M1, and to etch it on his memory. We will need about another £20 million to complete the project. but those 5,000 jobs will be the biggest job development since the industrial revolution and will replace the 3,000 jobs that the Tories got rid of when the pits went.

Mr. Brown

I am grateful to my hon. Friend, who has fought long and hard to replace the mining jobs that were lost in his constituency with new economic developments such as those that he described. We look forward not just to having full employment in one region but to achieving full employment in all the country's regions and nations. However, to pursue a matter raised in the Chamber today, if we are to continue to do so, we must have fiscal prudence as well. If the shadow Chancellor is now saying that he will replace the climate change levy with an £800 million increase in employees' national insurance to make the tax revenue neutral, the Opposition have, amazingly, announced another tax rise.

Mr. Roy Beggs (East Antrim) (UUP)

Does the Chancellor accept that the shortage of home helps and community care workers must be tackled so that we can deliver proper care in the community? Will he seek to provide incentives through training and the new deal to encourage more unemployed people to offer such a service? Our hospitals will benefit, and we will get patients into their own homes much faster if a proper care in the community service is available.

Mr. Brown

We are increasing the level of personal social services finance as a result of the spending settlement. That will enable us to help more people to stay in their homes and to move people out of hospital more quickly into either care homes or back into their own homes. It will allow us to expand social services in our country.

We also wish to expand pre-school care, about which the hon. Gentleman asked, by training more carers. As far as Northern Ireland is concerned, if he wishes to approach the Treasury, we will explain all the measures available to encourage the growth of child care and preschool provision for his constituency, including tax relief on the £50 that an employer would pay to an employee to allow them to buy their child care. The rises in social services budgets are possible only because we are prepared to put more money into our public services. I ask the hon. Gentleman to contemplate a situation in which the Conservative party would cut social services expenditure, as well as industry, science, defence and law and order expenditure—that is the fate that the shadow Chancellor would leave us to.