Unemployment (Hansard, 13 June 1991)

§ The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater)
My Lords, in May 1991 seasonally adjusted unemployment in the United Kingdom was 2,244,200.

§ Lord Dormand of Easington
My Lords, will the Minister confirm that the figure issued today that he has just given is the 14th consecutive monthly rise in unemployment and that unemployment is rising faster than in any other European country? I look forward to the 14th different excuse for that lamentable and devastating figure. Is the Minister aware that the number will continue to rise for at least six months, and some people say 12 months, for two reasons? First, the current severe contraction in demand is clearly deflationary in the short term. Secondly, the clear fall in investment will cause long-term damage to the supply side of the economy. Does he agree that a complete reversal of policy from the present Government's actions on unemployment is now due?

§ Viscount Ullswater
My Lords, this month's increase in seasonally adjusted unemployment is the smallest since January. Therefore there is unmistakable evidence that the battle against inflation is being won. Retail price inflation has fallen for several months. A continued and sharp reduction is expected over the remainder of 1991. As a result, in recent months interest rates have already fallen by some 3.5 per cent. Job prospects will improve following a resumption of economic growth.

Lord Morris
My Lords, how effective has Her Majesty's Government's legislation been in reducing the number of working days lost to industrial disputes?

§ Viscount Ullswater
My Lords, if one compared the early eighties with the late eighties, one would see that the decline in the number of working days lost has been dramatic. That demonstrates the effectiveness of trade union legislation. The number of working days lost in the 12 months to April was just under 1 million, the lowest 12-month total since the year to April 1942. The number of recorded stoppages in April 1991, at 32, is the lowest for any April since the current series began in 1930.

§ Lord Barnett
My Lords, it is good to hear that the situation will get better. Will the Minister inform the House what new or different policies the Government propose to pursue to ensure that matters will not become bad again, as has always happened in the past?

§ Viscount Ullswater
My Lords, the Government are determined that the battle against inflation will be won. That is the most important issue that the Government are tackling; and they have been very successful.

§ Lord Grimond
My Lords, will the Government agree that we are in general far too complacent about this continuing high rate of unemployment? Does it not show that there is now a shift in the economy in favour of capital as against labour, of which we ought to take account? Are not the Government deeply concerned that thousands of young people who have been trained in work are unable to gain employment and start their youth on the dole?

§ Viscount Ullswater
My Lords, I fear that the nation has been too complacent about wage increases. It is right that we have an unemployment rate for young people which, at 12.3 per cent., is much better than the EC average of 16.4 per cent.

§ Baroness Phillips
My Lords, do those figures include teachers who are made redundant by London boroughs, such as Westminster, in order to cut down their community charge?

§ Viscount Ullswater
My Lords, we count those who are actively seeking work.

§ Lord Stoddart of Swindon
My Lords, is the Minister aware that he is not only complacent but also evasive? Is he aware that the trend in wage levels is falling and not rising? Is he further aware that it is 1201 expected that the May and June figures will indicate that unemployment will fall, not rise, by 70,000? Do the Government realise that there should now be a sharp reduction in interest rates to single figures? That is the only way that we shall come out of this deflation, as the CBI has already told the Minister.

§ Viscount Ullswater
My Lords, I am very pleased to hear the noble Lord's support for the Government's position on curing the problems of inflation. That is what the noble Lord has just stated. Yes, of course we are pleased that average earnings continue to moderate. The average earnings index for April, at 8.75 per cent., is 1.5 per cent. lower than the figure for July 1990. That current downward trend is the longest sustained decline since the early 1980s.

§ Baroness Turner of Camden
My Lords, is the Minister aware that in this country we now have very little regulation in the employment field? Surely the unemployment figures demonstrate that that factor has little to do with regulation. Will he also agree that the fact that wage levels are now more stable also has little to do with unemployment figures? It simply bears out what my noble friends have been saying: that the situation relates to the Government's economic policies.

§ Viscount Ullswater
My Lords, no. I do not accept that. I believe that the Government's industrial relations activities have produced a climate in which the number of industrial disputes is a credit to this country.

§ Lord Hailsham of Saint Marylebone
My Lords, I believe that no one would wish to underestimate the misery and seriousness of unemployment, but does my noble friend agree with the leading article in The Times this morning? It deprecated the artificiality and want of objectivity of this perpetual trench warfare which turns everything into a party issue.

§ Viscount Ullswater
My Lords, of course I agree with my noble and learned friend. I have said from this Dispatch Box, on the many occasions that I have been given the opportunity to do so by the noble Lord, Lord Dormand, that all increases in unemployment are regrettable and that no one should underestimate the difficulties which unemployment can cause for the individuals concerned or for their families.

§ Earl Russell
My Lords, the Minister may recall that when we discussed government statistics on 13th March, we agreed that the correct way to calculate unemployment depended on what we wanted to know. I do not wish to know the number of people on benefit; I wish to know the much greater number of people who are not actually in work. Will the Minister inform the House of the number of people on income support who are under 65, not registered disabled and not registered unemployed? Will he also tell us whether the Government have been too complacent about the cost of unemployment to the Treasury?

§ Viscount Ullswater
My Lords, that issue is a long way from the Question on the Order Paper. However, I am advised that the number that the noble Earl seeks 1202 is in the region of 1.3 million. The Government recognise that there are groups of people who, for one reason or another, are not capable of being available for work and of actively seeking it. It would be unfair to expect them to do so. As they are not required to satisfy those conditions, it is right that they should not appear on the unemployment count.

§ Lord Campbell of Alloway
My Lords, is the Minister aware that to some of us who sit on these Back Benches the charges of complacency and evasiveness which have been made are not justified, especially when they are made by those who urge that we should prime the pump and yet not degenerate into complacency?

§ Viscount Ullswater
My Lords, I hope that my noble friend will consider that the answers given from this Dispatch Box are in no way complacent.

Lord Bruce of Donington
My Lords, will the Minister confirm that the Government's attitude to this issue is still that enunciated by the Prime Minister some months ago: that if it is not hurting it is not working? How much more hurt do they have to inflict?

§ Viscount Ullswater
My Lords, I cannot agree with the noble Lord. The Government are stepping up their positive action to help those out of work to find jobs. One hundred thousand new places in job clubs and job interview guarantee schemes have been introduced. We are doing our best to help those who have lost their jobs.