Unemployment: Government Measures (Hansard, 4 June 1986)

§ Lord Dean of Beswick
My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

§ The Secretary of State for Employment (Lord Young of Graffham)
My Lords, we have recently launched the Action for Jobs campaign to draw attention to the full range of our current measures to promote enterprise, training and employment. These measures are costing over £2,700 million this year. We are also launching a national restart programme to give special help to all those who have been unemployed for more than 12 months. Our policies to create an enterprising, competitive economy have led to the creation of nearly 1 million extra jobs since March 1983.

§ Lord Dean of Beswick
My Lords, I am grateful to the Minister for that Answer. However, would he not agree that, welcome as those measures may be, they are in no way sufficient to deal with the present situation of nearly 3.5 million unemployed, half of whom it is calculated will never get another job? Will the Minister tell us to whom he directed his statement last week that the country has never had such a good time? Was he directing it at and taking into account the 3.5 million people who are unemployed, or was he directing it to the 7,000 millionaires in this country, whose numbers have increased by 40 per cent. over the last five years?

§ Lord Young of Graffham
My Lords, I said much in a 15 minute interview last week. However, before I deal with that let me say that no country in the world has greater policies designed to help those who have been out of work for a long time than has this country, and no other country in the world has introduced programmes to help youth move from school into work. Let me clear up once and for all one canard that is in popular mode. We have 1.4 million people who have been out of work for more than one year. It is not the position that those people are not going back to work; many are going back to work. Our programmes are designed to help them to get back to work. Indeed, 25 per cent. of those who lose their jobs are back in work within three months; 80 per cent. of them are back in work within a year. What we have to do is to strive, through our policies, to ensure that they all get back to work.

§ Lord Cledwyn of Penrhos
My Lords, the House will have noted the Minister's comments with great interest. However, would he not agree that the closure 971 of major undertakings, of tin mines, of shipyards, of railway workshops and other industries which are absolutely crucial to areas outside the South of England, is a major tragedy? Would he not further concede to the House that, in spite of the policies to which he has referred and to which we give a limited welcome, the reason for the unemployment is the failure of the Government's economic policies? When do he and his colleagues propose to make a change in that?

§ Lord Young of Graffham
My Lords, the reason for the success of the Government's economic policies is the simple fact that we realise that the world is changing. There is no way in which we can go back to a world in which we can rely on building ships for a world that does not require ships or, unfortunately, on digging for tin for a world which does not require tin at prices at which we can economically dig for it. It is a world in which we have to prepare ourselves for the jobs that will arise tomorrow.
If noble Lords opposite wish to advocate alternative economic policies, I suggest that they go on a short trip to Australia, which elected a Government on good socialist policies—on getting unemployment down by investing in infrastructure. Lo and behold, last week, less than two years later, their finance Minister said, "We must stop this nonsense; we are in danger of becoming a banana republic". My Lords, this country must never go back to the days of being in danger of becoming a banana republic.

§ Lord Strabolgi
My Lords, how many of those people recently gaining employment are going into private domestic service, and do the Government think that this a productive use of labour?

§ Lord Young of Graffham
My Lords, to my knowledge the total amount of those involved in both agriculture and domestic service is 2½ per cent. in this country. Of that perhaps even half a per cent. is private domestic service. I am not sure of the figures. It is certainly not a significant number.

§ Lord Grimond
My Lords, in view of what is happening at Swan Hunter, can the Government tell us whether they are bringing forward the date for the next naval orders; and, if so, when will they be?

§ Lord Young of Graffham
My Lords, that is an entirely different question. If the noble Lord would put it down on the Order Paper I am sure that it would be answered.

§ Lord Moyne
My Lords, is there any measure which could create more direct employment pound for man than an increase in financial support for the Housing Corporation?

§ Lord Young of Graffham
My Lords, what we have seen, other countries in Europe have seen, and other industrialised economies have seen, is that investment in infrastructure for the purpose of creating employment does not work. Investment in infrastructure, for the purpose of improving the infrastructure, does. We have a considerable housing 972 programme. That is valuable in its own right. It is not by any means an efficient employment measure.

§ Lord Glenamara
My Lords, is the noble Lord really aware of the latest mass redundancies at Swan Hunter on the Tyne, to which I think the noble Lord, Lord Grimond, referred, bringing the unemployment in some parts of the North-East to a level which far exceeds that of the 1930s? Following the recent redundancies by British Shipbuilders, what initiatives do the Government intend to take in the North-East of England, or have the Government written off the North-East of England?

§ Lord Young of Graffham
My Lords, the Government have certainly not written off the North-East of England. Indeed, only two weeks ago, when unfortunately redundancies became abundantly clear in British Shipbuilders, British Shipbuilders set up an Enterprise Corporation. It is no good finding any help for the North-East, the North-West, or other areas of this country, other than by building up slowly and painfully new enterprises and new businesses. There is no other short cut.

§ Lord Brougham and Vaux
My Lords, reverting to the original Question regarding new initiatives to tackle unemployment, may I ask my noble friend how many jobs the Government think will be created by the clean up Britain campaign? Secondly, referring to the noble Lord who asked the question about millionaires, they in fact contribute a lot to the economy of this country.

§ Lord Young of Graffham
My Lords, the formal programme which is looking towards what has popularly been called litter has not been announced, but I have read a considerable amount about it in the local papers. It is, so I read, a programme which is going to involve some 5,000 places on the community programme, and it is a programme that I look forward to seeing announced in due course.

§ Baroness Seear
My Lords, would the Secretary of State confirm that the restart scheme is genuinely intended to get people back to work and is not, as is unfortunately and in my view mistakenly in many quarters believed, a way of finding people who are in fact drawing benefit when they should not be doing so? I ask this because the scheme is being damaged by rumours to that effect.

§ Lord Young of Graffham
My Lords, I hope that no one in your Lordships' House will think that there is anything wrong in the Government seeking to ensure that those people who are not entitled to benefit do not draw it. The restart scheme is predominantly about helping those who have been out of work for more than a year, back into work; and in that it is going to have considerable success. The efforts of my department are concerned with those who have been out of work for a long time. However, I am equally concerned that there should not be people who prey off the unemployed by taking benefit when they are not entitled to it.

Viscount St. Davids
My Lords, would my noble friend consider having somewhere at the back of his mind—I do not mean instantly—this point? Tourism can be helped by encouraging the rebuilding of certain of our inland waterways—a subject that I am sure he knows about well. Of course, one does not get all that much from the actual rebuilding, or indeed the starting of the resultant waterways, but each waterway rebuilt creates a sheaf of new employment along each side of it. This, in the end, produces a great many new and permanent jobs which are of great value to this country both for earning foreign currency and also in dissuading our own people from going abroad.

§ Lord Young of Graffham
My Lords, since I entered your Lordships' House I have had a long and intensive learning process on the value of inland waterways from the noble Viscount. I shall certainly bear it in mind.

§ Lord Barnett
My Lords, accepting that the noble Lord's recent interview was truthful if somewhat insensitive, may I ask him this question? Would he not accept that those who are having a good time are doing so at the expense of the unemployed, given that the growth of earnings has been so much in excess of inflation and indeed of productivity? In those circumstances, what does the noble Lord propose to do, other than exhortation, to help the situation?

§ Lord Young of Graffham
My Lords, the great insensitiveness about the interview was the selectivity with which one particular phrase out of the 15 minute interview was taken. I hate to bore your Lordships' House but I should say that immediately before that my actual words were: I feel concern for people who have been out of work for a long time, and more than anything else I am motivated by a desire to see people back into employment and see the economy grow and, above all, to have a caring society. The purpose of that interview was to point out that we live in a world in which we have strongly rising living standards paralleled by rising unemployment; it was to point out that last year in manufacturing industry we needed to see wages increased by 1.2 per cent. to maintain living standards, and manufacturing wages increased by 7½ per cent. Last year we had probably the largest single rise in real earnings in manufacturing industry since the war, and possibly this century, and what we have done is laid the seeds for further unemployment in manufacturing industry. That was the purpose of that interview, and if noble Lords opposite wish to misinterpret that, so be it.

§ Lord Maude of Stratford-upon-Avon
My Lords, is it not the case that the problem that needs addressing is not that of preserving out-of-date and uneconomic industries, but the fact that the rate of innovation in this country is deplorably low and that outside the defence field the expenditure on reserch and development is totally inadequate?

§ Lord Young of Graffham
My Lords, I think it is innovation which is the important part of our economy. However, in looking at it—if I may refer to the earlier question from the noble Lord opposite—the 974 Government are seeking to endeavour to persuade both trade unions and management that in the interests of future employment there should not be excessive pay rises. On the other hand, we must look not towards a low-wage economy but towards an economy in which future profits can be shared so that management and workforce can both be part of a more profitable society.

§ Lord Stallard
My Lords, will the noble Lord accept that I am not one who wants to stop him making the kind of speeches or remarks that were attributed to him last week? On the contrary, I am one of those who think that those kind of remarks only serve to show how remote are he and many of his governmental friends from the real situation in the world in which we live—

Noble Lords
Question!

§ Lord Stallard
Does he accept that? I asked that when I rose, but the noble Lord's noble friends did not hear me. Following his replies today, can he explain to me why, if we have learnt from all the mistakes of every country in the world that he keeps quoting, we are in the mess we are in? Why if the world is as rosy as he sees it, do we have today a report that long-term unemployment will be with us into the 1990s on an increasing scale?

§ Lord Young of Graffham
My Lords, if we were to judge between the question I have just been asked and the answer I shall give on who is out of touch with the world, I think the record will show the position. I have spent all my time, for four years and two months now, looking at the problems of unemployment and of helping to get people back into work. We, in common with all other large industrialised nations, have seen long-term unemployment rising. It has finally been checked in this country. I would venture to make a forecast that in six months' time we may well see it lower than it is today. We may well see long-term unemployment begin to decline. I very much hope so, because that is what we are working towards. It is no good wishing away the world. What we have to do is to find ways of combating the problem.

§ Lord Dean of Beswick
My Lords, cutting through all the figures that have been bandied about today, is it not a fact that the most dangerous feature of unemployment is that our manufacturing base is still shrinking? Is it also not a fact that we still have lower wage rates than most of our major competitors? When can we expect the shrinkage of our manufacturing base to stop and the base to start moving upwards? Is this not the absolute keystone of our real economic recovery?

§ Lord Young of Graffham
My Lords, manufacturing employment—I am the Secretary of State for Employment—has been declining steadily since 1966. It has been declining at a steady rate which accelerated for two years in 1980 and 1981 and it has carried on declining, as it has in all industrialised nations, other than Japan, where it has remained roughly stable, because of technology. We still export per capita more 975 than Japan and more than the United States. We shall solve this problem when we pay more attention to design and performance and to ensuring that our goods sell in a highly competitive world.

§ Lord Cledwyn of Penrhos
My Lords, can the noble Lord say whether the very important six-month forecast that he has just given is a Government forecast, or is it a personal forecast?

§ Lord Young of Graffham
My Lords, I said as a member of the Government that I suspect that in six months' time we shall begin to see long-term unemployment go down.