Youth Work Creation Schemes: Costs (Hansard, 27 October 1981)

Lord Campbell of Croy
My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.

Earl Ferrers
My Lords, the Youth Opportunities Programme and the Young Workers' Scheme are not comparable in terms of net costs per place. However, the present net cost of a YOP place is around £24 per week. It is not possible to state the net cost of the Young Workers' Scheme, first because it does not start until 4th January 1982, and secondly because there will be too many unknown factors to permit any reasonable degree of accuracy in such calculation.

Lord Campbell of Croy
My Lords, I am grateful to my noble friend for that reply and recognise that it is probably too early to make even a rough comparison now. However, how many additional jobs do the Government hope the Young Workers' Scheme will produce during 1982 after its start in January, applying as it does to under-18s in their first year of work and, therefore, being especially relevant to school-leavers?

Earl Ferrers
My Lords, it is very difficult to forecast with any accuracy what the position will be. However, the operating assumption is that the coverage is likely to build up within a few months to between 50,000 and 100,000 young people.

§ Lord Davies of Leek
My Lords, is the noble Earl aware that in the Guardian today there is an interesting suggestion that the cost to the Government of keeping some of these young workers in work is somewhere in the neighbourhood of £2,000? Would it not be worthwhile to give grants to some unemployed students who have their A-levels and who are qualified to go to university and worthy of a university place—for there are plenty of university places—thus enabling progress to be made in Britain and increasing our adaptability to the new world?

Earl Ferrers
My Lords, I had not seen the article to which the noble Lord referred and of course the difficulty is that it is very simple to make calculations of that nature without going into all the complexities of the position. I would only tell the noble Lord that the whole purpose of both the Youth Opportunities Programme and the Young Workers' Scheme is in order to try to alleviate the problem of unemployment which is affecting young people.

§ Lord Orr-Ewing
My Lords, did my noble friend note in The Times profile of the Manpower Services Commission that it was reported that the cost of training young people could be as much as £2,000—£40 a week—rather than the £25 cost mentioned by my noble friend in his first reply? Can he say exactly what is taken into account in the £25 per week costing as opposed to the £40 a week costing reported in The Times and repeated in a letter in that paper today as well?

Earl Ferrers
My Lords, when you take into account the gross cost it covers all the costs of the scheme, 899 including the administration and the purchases of materials and so forth. I would remind my noble friend that under the Youth Opportunities Programme there are some four schemes: the work experience scheme, the community projects, the training workshops and the work preparation courses in colleges of further education. The gross costs of these schemes vary from between about £30 to over £100. The average gross cost is £40. From that you then have to subtract the benefits which would otherwise have been paid, which are round about £16, which gives you the net cost of £24.

Lord Oram
My Lords, while recognising the difficulty of making comparisons between two distinctly different schemes, is the Minister aware that The Times recently forecast that places under the Young Workers' Scheme would be very costly and that it went on to explain that the cost would be high because the scheme, by its very nature, subsidises a high proportion or jobs which would have been created anyway? In other words, are not the Government proposing to pay employers to do something that they were in any case going to do? If that is so, is it not a somewhat ironical, but perhaps perfect, complement to the Government's decision recently in the Wildlife and Countryside Bill to pay farmers for not doing what they were not proposing to do anyway?

Earl Ferrers
My Lords, the noble Lord, Lord Oram, is ingenious. Of all the questions which one might have anticipated, I never thought that the Wildlife and Countryside Bill would come up under this Question. He is perfectly correct in that some of the money which will be paid under the Young Workers' Scheme will go to those who, anyhow, will have been employed. That is why it is difficult to answer my noble friend Lord Campbell of Croy. Of course, the advantage of this is that it is a payment to employers to make the work of young people more attractive, and the administration is very small. In other words, all the expense of the scheme goes to the purpose for which it is required, which is to encourage the employment of young people.

§ Lord Alexander of Potterhill
My Lords, will the Minister agree that because of the nature of the society in which these young people will live the fundamental need, rather than work experience, is to raise their educational standards so that they can be trained for the kind of technological society in which they will live? Are the Government not failing to recognise this problem and to make provision for it?

Earl Ferrers
My Lords, that is a very important point, but I do not think it is the whole point. Many people have perfectly good training but are unable to get jobs. The purpose of both these schemes is to encourage these people to get jobs, whether or not they have training.

Lord Wallace of Coslany
My Lords, is the noble Earl aware that both these schemes, however desirable, are in fact temporary expedients, and that the only worthwhile objective of the Government is to ensure a situation where a young man or girl leaving school 900 can get an adequate, progressive job and receive training which will benefit not only him or her but the country as a whole?

Earl Ferrers
My Lords, the noble Lord, Lord Wallace, is absolutely right; of course, these are temporary expedients. But we are going through a period of great recession and of great human discomfort. The Government are doing their best to try to ensure that the temporary position is alleviated while, at the same time, ensuring that the future of the country depends upon being competitive.