EC Jobs Study Proposal: Cost (Hansard, 9 January 1996)

§ The Minister of State, Department for Education and Employment (Lord Henley)
My Lords, there has been no substantive discussion of this proposal in the Social Affairs Council. When it is discussed in the Council, the Government will want to be satisfied that any programme that may be agreed is properly targeted and well managed and that the budget is no more than is necessary for any agreed purposes.

Lord Bruce of Donington
My Lords, I am most grateful to the noble Lord for that reply. Will he confirm 2 that over the next four to five years, depending upon which construction is placed on the Government's explanatory memorandum, some £47.2 million is to be spent on trying to classify, interpret, compare and evaluate the plans that each member state has for encouraging employment in their respective countries and to set up records for that purpose? In view of the fact that there are already 1.4 million fewer people employed in the United Kingdom than there were five years ago, does the noble Lord not agree that the money may well be better spent on infrastructure and investment rather than on a ridiculous search for further work for officials of the Commission?

§ Lord Henley
My Lords, perhaps I may start by offering an apology to the noble Lord. The explanatory memorandum to which the noble Lord referred is somewhat misleading. At paragraph 10 it refers to "four years" whereas, as the noble Lord will be aware, at paragraph 1 it refers to "five years". I can assure the noble Lord that the period is in fact five years, not four years.
As Her Majesty's Government have said consistently, we believe that the Community has some role to play in helping to tackle unemployment. We believe that it has a role in promoting the exchange of information and in disseminating good practice. Therefore, I believe that many of our European colleagues have a great deal to learn from practice in this country and from the successes that we have had. I can assure the noble Lord that the programme of £47.2 million (57 million ecus) to which he referred is not one, as I made clear in my original Answer, that has yet been agreed to. It has not had any level of detailed discussion at the appropriate Council. Her Majesty's Government will not agree to it unless we believe that there is a rationalisation of existing activities which produces considerable savings. I can assure the noble Lord that we certainly would not agree to it unless we thought that it provided value for money.

§ Baroness Turner of Camden
My Lords, does the Minister agree that it is sensible lo try to devise EU-wide plans for dealing with unemployment 3 throughout the Community, especially in view of the fact that, in any case, the Government are committed by Article 2 of the Treaty to try to aim for, a high level of employment and of social protection, the raising of the standard of living and quality of life, and economic and social cohesion among Member States"? Does the Minister agree that other countries may also have something to teach us in that area?

§ Lord Henley
My Lords, as I believe I have made clear on a number of occasions, employment policy is very much the responsibility of individual member states. I said that I thought there was a role that the Commission and the Community could play in disseminating good practice. That is why I believe that many European countries could learn from us. They could look at our deregulated and flexible labour market; they could look at our low non-wage labour costs; and they could look at the sustained, non-inflationary growth we are experiencing.

§ Lord Stewartby
My Lords, when my noble friend the Minister or one of his ministerial colleagues attends the appropriate Council, will he suggest that a lot of money could be saved if, instead of all this spending on research, some of the more obvious lessons of the current situation, such as the excessive cost in Europe of employment as against other parts of the world and especially the Far East, were learnt? That is a far greater obstacle to the creation of new jobs than the sort of matters which those concerned would otherwise be investigating with all this Community money.

§ Lord Henley
My Lords, my noble friend is absolutely right. That is why I was keen to stress the relatively low non-wage labour costs that we experience in this country compared to our European partners. I believe that that is certainly something they could learn from us. And there are many other practices within the United Kingdom which could be usefully adopted by other countries.

Lord Bruce of Donington
My Lords, is the Minister aware that, in his observations on 18th December, the Prime Minister himself specifically eliminated the level of unemployment as one part of determining convergence? Is the Minister also aware that the circular to which he referred was followed by another on 10th November which elaborated the whole affair? Is the Minister further aware that if the Government were to adopt the correct procedure of releasing local government funds they could make some dent in the case of the 250,000 construction workers, both skilled and unskilled, whose unemployment is costing the country at present £2 billion per annum?

§ Lord Henley
My Lords, the noble Lord's latter point has nothing to do with the Question on the Order Paper and I do not believe that it would be the right way to go about trying to stimulate economic growth. It is not the job of government to create jobs; it is the job of government to create the right conditions in which the number of jobs will grow. That is why we have been pursuing the policy—and I put it again to the noble 4 Lord—of a deregulated and flexible labour market, low non-wage labour costs and sustained low inflationary growth.

§ Lord Mackie of Benshie
My Lords, is not the most useful aspect of the programme the fact that it provides the noble Lord, Lord Bruce of Donington, with ammunition to keep us going for another five years?

§ Lord Henley
My Lords, that is really a question for the noble Lord, Lord Bruce of Donington, to answer. However, I shall certainly answer the questions put to me by the noble Lord.

§ Lord Pearson of Rannoch
My Lords, does my noble friend the Minister agree that nothing much can be done to improve employment in the Community until the other countries agree to abandon the absurd social chapter—so favoured by the Benches opposite—and join Her Majesty's Government in the kind of policies that they promote?

§ Lord Henley
My Lords, my noble friend is absolutely right to draw attention to the dangers of the social chapter. I believe that even the noble Lord, Lord Bruce, would agree with me that if the social chapter were adopted by this country it would provide a great deal more scope for the Community to centralise and harmonise in areas where Her Majesty's Government do not believe that it would be appropriate to do so. Indeed, those are matters which should be left to the principle of subsidiarity. Further, I believe that if we pursued the policy of adopting the social chapter, the likelihood would be of Community legislation in those areas being imposed upon the UK whether or not Her Majesty's Government or Parliament wished it. It would also lead to the increased costs we have mentioned on many occasions; it would damage labour market flexibility and lead to a loss of jobs.

§ Lord Richard
My Lords, did I hear the Minister right? Did he say that it was not the function of the Government to create jobs? Is that the policy of Her Majesty's Government?

§ Lord Henley
My Lords, it has never been the function of the Government to create jobs. It has always been the function of government to create the right conditions in which the number of jobs can grow.

Lord Bruce of Donington
My Lords, as the noble Lord has been kind enough to address a question to me personally, I should, first, remind him that I am not yet a member of Her Majesty's Government, and, therefore, I am not required to answer questions from him. However, as the noble Lord has been courteous enough to put the point, perhaps I may say in reply that I regard the social chapter in the same way that the Select Committee in another place regarded it—namely, as "much ado about nothing".

§ Lord Henley
My Lords, I am grateful for the noble Lord's elucidation of his own particular beliefs about the social chapter. I suspect that they do not fall exactly in line with those of his noble friends on the Front Bench.

§ Baroness Farrington of Ribbleton
My Lords, can the Minister explain how the Government can deny 5 responsibility for wasting public money by keeping people in the construction industry on unemployment benefit at a time when the private sector has spoken out and criticised them for failing to allow that money to be diverted instead into the necessary building, maintenance and repair of this country's infrastructure?

§ Lord Henley
My Lords, that is another question. I do not believe that the answer to creating jobs in this country is one that the noble Baroness wishes to pursue, for example, simply throwing money at the problem. The answer to creating jobs is to create the right economic conditions in which employers take on people and feel it right and proper that they can take on people securely and pay them the right wage.

Noble Lords
Next Question!

§ Baroness Turner of Camden
My Lords, does the Minister accept that all this nonsense from his side about the social chapter is a kind of mantra? The social chapter itself is a set of very minimal and pious objectives. It does not include matters such as wages, the right of association, the right to strike or the right to impose lock-outs. From our point of view, is not the noble Lord just creating a lot of nonsense here?

§ Lord Henley
My Lords, I believe that I heard the noble Baroness refer to what was said about the social chapter on her side as being a lot of nonsense. If that is what the noble Baroness said, I totally agree with her.