HL Deb 28 November 1984 vol 457 cc902-8

3.4 p.m.

Lord Balfour of Inchrye rose to call attention to the needs of those unemployed whose prospects of further employment are slender due to age and changes of economic conditions of trade; and to move for Papers.

The noble Lord said: My Lords, I rise to move the Motion in my name. The first duty I have to the House is to record the answer to a question of mine from the late Lord Swinton, just before he left the House: he died shortly afterwards. We were sitting where the noble Earl, Lord Swinton, is sitting here today at the corner and the debate had to do with colonial affairs, on which he was a great expert. I asked him, "Philip, are you going to speak?" He said, almost severely, "No, no one wants to hear the speeches of old men".

That warning I take to heart and I shall not detain your Lordships for very long. However, that rule has its exceptions. We have recently heard the wonderful maiden speech of my noble friend the Earl of Stockton; forceful and, I thought, gentle—that would be my description. Our second exception to the rule which I term the Swinton rule is my noble friend opposite, Lord Shinwell. His contributions we all enjoy. They are pungent and very much to the point. If I may for a moment use the language of the turf, I would say that Lord Shinwell is leading in the veteran stakes but there are several other good horses running up the course and in due course we shall know who in the field will be first past the winning post.

For two reasons, I took particular care in drafting my Motion to keep it limited to one aspect of unemployment. First, I know your Lordships are very shortly to debate in full the question of unemployment and, secondly, I do not wish to detain the House for too long. The size of the problem of unemployment for men of middle age and beyond is serious and great.

I wonder whether your Lordships realise that 25 per cent. of men and women unemployed at the present time have been unemployed for five years or more and, of these, 40 per cent. are over 50 and have given up hope of being in regular employment.

Last November, just a year ago, we touched upon this subject in a debate following a Motion by the late Lord Byers. I was taken to task by the noble Baroness, Lady Seear, and by the noble Lord, Lord Scanlon, for pessimism and for thinking that nothing could be done. I am no pessimist but I do not agree with Lord Scanlon's words. I told the noble Lord that I intended to quote him. He said: I want to turn to the contribution by the noble Lord, Lord Balfour, and say how much I agree with the noble Baroness, Lady Seear, in her rebuttal of. . . the unemployed and, if I may say so, of the right reverend Bishop. If ever we develop this policy of despair, this philosophy that there will be a section of our community doomed to perpetual unemployment, we shall destroy all that is being argued about now."—[Official Repor, 2/11/83; col. 603.]

I am no pessimist. I think I am a realist. I feel that people in a section of the industrial community have written themselves off and I am afraid that we must write them off as well as regards regular jobs.

It is pie in the sky for the noble Lord. Lord Scanlon, to say that everyone over 45 or 50 years of age has a chance of permanent employment again. We have heard so many times about how unemployment can be cured. We on this side of the House have often heard Ministers say—and no doubt the Minister will repeat it today—that the real cure for unemployment is for British industry to sell to the markets of the world goods at the right price and with the right delivery dates. Then we have heard from the other side of the House many interesting suggestions about shorter hours, work sharing, longer holidays, and various other reliefs. All right, we need not argue about any of those, but we must admit that none of them would work quickly. All would take an indefinite period of time ahead. For as long as most of us are here in this House, high unemployment will be with the community. Can anyone say (does the Minister dare to say?) how long it will take the Government to bring about a reduction from 3 million to, say, 2 million? Can anybody on the other side say the palliatives that they would advocate to bring 3 million down to 2 million? I believe that it is an impossible thing to prophesy. Trade revival hopes and talks will not touch them.

To me, the tragedy is that of the 50 or 55 year-old ex-executive and ex-manual worker who suddenly become redundant. What is their life to be? They see lying ahead a long road of unemployment with their just sitting around or, if I may use the expression, sitting on their hunkers, gazing into space. What a future for them to consider! What we have got to do is to see that we can put something of the joys of life and of interest before them so that they may still use the talents and energies which remain to them in creating new ideas, new hobbies, a new form of social life. Leisure means effort. They must make the effort; and we, too, as leaders of political parties, must make the effort.

Today, the Government provide protection from hunger and immediate want. Thank goodness! When I went into another place 55 years ago, unemployment was a savage, cold, harsh knife which cut into families. I am always ashamed that, sitting as I did for a comfortable South of England seat, my greatest worry then was a few seasonal workers. I did not—and some of my friends did not—take the train to South Wales to see what was going on there at that time. That is why I speak today. It is because ever since then I have felt that we must not let things remain static; we must improve the whole time.

To bring some happiness to these men, Government leadership and action is required. There is no use in thinking that local authorities and local authority representatives can do the job: it must be done from the centre by the Government agencies. These men are not seeking charity, they are seeking opportunity. It is true that voluntary work can do much to relieve. We have 40,000 (I think it is) volunteers. They are splendid people, but they are really engaged mainly in looking after the sick and in helping those who cannot be mobile, doing shopping and doing various other things. No, we have got to do something more than that for them.

What I want to see is the Government at the centre carrying out an experiment. The experiment that I would advocate is based upon the work of many voluntary bodies that we can quote with great benefit to all concerned. The body that I choose to quote to your Lordships as an example is Toynbee Hall. Toynbee Hall is celebrating its centenary this year. They have gone for the aged in a big way. They have a senior care and leisure centre where, they say, the keyword is opportunity. They introduce new amusements for the unemployed—many games, indoors and outdoors, and sport—and they introduce new works of art and woodworking efforts. I could go on in this way, but I shall not weary your Lordships.

In many directions the Toynbee Hall leisure centre could set an example of what the Government could do if they were able to start three or four centres as an experiment; if they were to take the centres of high unemployment and start building one of these leisure care centres.

Let them see what the result is. They would need very little cash, but they would need a lot of good leadership, which is not easy to obtain. I think that if we could do that we could inspire minds which have become more and more affected by prolonged unemployment. We could stimulate their minds and stimulate their bodies.

We have now got a new "supremo" of unemployment who has been appointed. I have not had the pleasure of meeting him, and I do not know whether some of your Lordhips have done so. I hope that he will not concentrate entirely on youth and on youth and training, but will take this section of older men in hand and see whether we can stop the rotting minds and the rotting bodies brought about by constant unemployment, and can stimulate them in the ways I have described, by having three or four of these centres built. Try it out for a year or two and see whether there is not a good result! I sometimes think what wonderful material Toynbee Hall and others like it have to work on. How patient and good are these unemployed at the present time! I hate to see the downward fall of good minds and good bodies.

I would say to the Government, "Be bold; be determined to stop this rotting away!" Mr. Churchill used to send periodically to departments a folder labelled, "Action this day." I cannot but say to the noble Lord who is to answer that I would wish that he was able to send a folder to his Prime Minister saying to her, "Action this day"—because that is what we need. I beg to move for Papers.

3.20 p.m.

Lord Rochester

My Lords, I am sure that the whole House will be grateful to the noble Lord, Lord Balfour of Inchrye, for giving us this opportunity to examine the needs of the older unemployed people among us, for their plight, as he indicated, is both demoralising for them and wasteful of talent and of experience for our country. I shall not be taking the same line as the noble Lord, but 1 am sure that all your Lordships will be glad that the noble Lord, Lord Balfour, did not, on account of age, feel precluded from giving us the benefit of his views on this vital subject.

I was privileged to be a member of your Lordships' Select Committee on Unemployment under the chairmanship of my noble friend Lady Seear. We paid considerable attention in that committee to early retirement as a means of reducing the supply of labour, and in our recommendations we made it plain that if there had to be unemployment among older people we preferred measures to reduce the numbers in employment by voluntary means. In thus supporting the option of voluntary early retirement, we concluded that this could best be achieved in three ways.

The first was to extend the Job Release Scheme, under which employed people nearing statutory pensionable age can give up their jobs to make way for younger unemployed people and in return receive a weekly allowance. Our view was that the qualifying age for job release could reasonably be reduced from 62 to 60, to bring about 50,000 more people within the scheme under protections which were current at the time. Incidentally, I believe that the qualifying age for subsidised retirement in Western Germany is now 58. I welcome the decision announced by the Secretary of State in another place on the 12th November to continue the Job Release Scheme for a further year, but I regret that his proposals do not include provision for reducing the age at which people are eligible to take part in it.

A second recommendation of the Select Committee was that as a varient of the Job Release Scheme, and in order to combine the benefit of gradual retirement with a reduction in labour supply, pairing or job-splitting schemes should be introduced, under which two people aged over 60 would be employed half-time in place of one person full-time, each of them to receive half-time earnings. An essential element in our proposal was that, as inducements to participate in such arrangements, no national insurance contributions would be payable by either employers or employees. I am sorry that employers contemplating the introduction of job-splitting schemes appear to have been deterred from taking action by a number of factors: the effect on occupational pension schemes (which we foresaw in our report), opposition from trade unions, and the benefits accruing to employers and employees being regarded as insufficiently attractive. In his Statement in another place a few weeks ago the Secretary of State said he proposed that an allowance should be made to the employer to cover the extra cost involved in job splitting. That, it seems to me, is to be welcomed, and I would be grateful if the noble Lord, Lord Belstead, when he replies to the debate, would tell us the amount of this allowance, if he can.

I congratulate the Government on having at last abolished altogether the national insurance surcharge on employers. But is there not now a strong case for restructuring national insurance contributions so that they no longer apply either to new jobs—particularly for the long-term unemployed—or to the splitting of existing jobs?

A further recommendation of the Select Committee concerned the so-called "over 60s option", under which all those aged over 60 who have been unemployed for more than 12 months can opt for the higher rate of supplementary benefit in return for their withdrawal from the unemployment register. We considered that at the relatively low cost (at the time) of £20 million per annum, that option could reasonably be made available to long-term unemployed people aged 55 and over. Now that the problem of long-term unemployment has become so much more acute, I wonder whether the noble Lord, Lord Belstead, would bring this point especially to the attention of his right honourable friend.

I know it is all too easy to talk of ways in which money can be spent in simply limiting the problem that we are now considering. A key criterion in my view is that expenditure in this field should be concentrated as much as possible on finding work for older unemployed people rather than encouraging them simply to accept unemployment as a fact of life—and to this extent I am sorry that I must respectfully disagree with what the noble Lord, Lord Balfour of Inchrye, had to say on this subject and align myself with my noble friend Lady Seear and with the noble Lord, Lord Scanlon, in the remarks they made in an earlier debate on that point.

With that point in view, I should like to spend the rest of the time that is available to me in the debate in saying something about the creation of new jobs for such people, and by way of example to draw attention to the activities of an enterprise agency—only one of about 175 in the country as a whole—which has been operating for the past five years in Cheshire, where I live. It was actually visited very soon after its inception by members of the unemployment committee, and has developed greatly since then. It is located in Runcorn; it is called Business Link Limited; and was established by representatives of industry, commerce and local government to promote employment in Halton—a district where the unemployment rate was—and alas! still remains—relatively high for the North-West. In fact, it is almost part of Merseyside; and I do not doubt that when the right reverend Prelate the Bishop of Liverpool speaks after me he will have a good deal more to say about unemployment among older people in that area.

The core activity of the agency of which I speak is counselling clients, of whom a recent survey showed about three-quarters wished to set up a new business and the remainder wished to receive advice on how to improve the efficiency of an existing business. Approximately half the agency's clients between December 1979 and February 1983—the period covered by the survey—responded to a questionnaire which was sent to them. Analysis of the replies has shown that during that time altogether 185 new firms were started, of which 26 have since closed. The net number of new jobs created in these new businesses—that is to say, after taking account of jobs lost in those which later closed—was 491. To these should be added 577, net, new jobs in existing firms which were counselled, making a total of well over 1,000.

The precise age distribution of people taking up these jobs is not known to me, but it is plain from the facts that about one-third of the respondent clients were facing redundancy; that another quarter were unemployed; that nearly half the newly established firms employ only one man; and that a large number of those concerned must be in the category of people who the noble Lord. Lord Balfour of Inchrye, had in mind when introducing the debate.

I do not for a moment pretend that the activities of agencies such as the one I have mentioned can make more than a small contribution to the solution of the complex problem of how to alleviate unemployment among older people. From the CBI I understand that enterprise agencies throughout the country are helping to create jobs at the rate of about 3,000 per annum, but it is encouraging, I suggest, that these community projects represent a partnership between industry, commerce and local government, which I hope we can all agree should be built on.

The enterprise allowance is a vital element in enabling people to start a new business. It now amounts to £40 per week and is payable for one year. In his recent Statement the Secretary of State said that he was proposing to extend the scheme and to allocate to it an extra £72 million next year, rising to £125 million and then to £128 million in the following two years. The Secretary of State said that this would enable the Manpower Services Commission to increase the programme by 25 per cent. to provide for an intake of about 1,250 new entrants every week from among unemployed people. I very much welcome this development, but would be grateful if the Minister could tell us what increase, if any, the additional amount allocated to the scheme will bring to the individual qualifying for payment of the allowance.

Before I leave this theme, it is only right that I should briefly welcome the scheme announced last Monday which is to be financed by the European Regional Development Fund and which is aimed at encouraging the development of small businesses in depressed regions that were formerly heavily dependent on shipbuilding, textiles and steel making.

I end as I began by saying how vital it is, in my view, that in the national interest we should do everything possible to meet the pressing needs of the older unemployed people about whom we are talking in this debate.