New Deal: Intermediate Labour Markets (Hansard, 2 May 2000)

§ Lord Sheppard of Liverpool
asked Her Majesty's Government:
How, after two years of the New Deal, they assess the potential offered by intermediate labour market projects to ease the period of transition for those furthest from the labour market.

§ The Minister of State, Department for Education and Employment (Baroness Blackstone)
My Lords, we believe that, especially when linked to jobs with employers in a given area, intermediate labour markets have an important role to play in moving long-term unemployed people from welfare into work. We are using intermediate labour markets within the New Deal, and in other programmes, all of which are being, and will continue to be, fully and independently evaluated.

§ Lord Sheppard of Liverpool
My Lords, I thank my noble friend the Minister for that very encouraging answer. Does she agree that the New Deal is the most determined and serious attempt yet to get third-generation unemployed people into work? Does she agree with me that there are areas where unemployment is still high and where the New Deal will be discredited, as earlier training programmes have been, if programmes such as, for example, the Sheffield intermediate labour market, warmly praised by David Blunkett, are not created and pay a proper wage? Are they to be part of what the 15 new employment zones are to offer?

§ Baroness Blackstone
My Lords, I am most grateful to my noble friend for his support of the New Deal. It is the most determined and serious attempt to tackle the problems to which he referred. Long-term unemployment is at its lowest for nearly 20 years. While I agree that there are blackspots where unemployment is still high, the spread of unemployment around the country at regional level is relatively even compared with the position in the 1980s. My noble friend mentioned the New Deal intermediate labour market in Sheffield. That provision is certainly helping New Deal participants to gain valuable work experience in a whole range of skills. It will be looked at within the overall evaluation of the New Deal. On my noble friend's final point, I reiterate that local intermediate labour markets will be used in the new employment zones to help those 927 who have limited chances of getting a job to do so. It is part of a pathway to helping them to become more employable.

§ Baroness Miller of Hendon
My Lords, given that most people taking part in the New Deal are involved with the employment and training sector, does the Minister share my disappointment that, according to the latest figures, only one in 10 of those involved in that sector complete the course and that only 8.5 per cent go on to get full jobs as opposed to going into the other three sectors? Can she say what the Government will do to motivate more of them to take full advantage of the scheme?

§ Baroness Blackstone
My Lords, I certainly would be very disappointed if the figures given by the noble Baroness were accurate and correct, but I do not believe that that is what the figures show. Around 42 per cent of those who are on the education and training option go into jobs. That is what the statistics collected by the Government indicate. I would accept that even 42 per cent is a lower proportion than should be the case. It is important that we continue to work on evaluating this option and that we provide rather more help to young people with regard to the kind of jobs they can get and how to get them. In other words, it should not be an option that simply provides employment and training; it should provide good guidance and proper preparation for work.

§ Baroness Miller of Hendon
My Lords, the information I gave was information given in answer to parliamentary Questions in the other place. Perhaps we need to look those up.

§ Baroness Blackstone
My Lords, I am happy to check the source but I think that what the noble Baroness is describing is a slightly different figure. I am advised that 42 per cent of those who come through that option find employment. However, I accept what lies behind the noble Baroness's question: that those on the education and raining option have to be given more help and preparation in terms of getting a sustainable job.

§ Lord Brooke of Alverthorpe
My Lords, on the subject of statistics, can my noble friend the Minister advise us just how much youth employment has fallen since the Government came to power? What further plans and ideas are being considered by the Government to ensure that this trend is maintained, especially in the pockets of high unemployment which were mentioned earlier?

§ Baroness Blackstone
My Lords, the number of JSA claimants aged 18 to 24 has fallen by 21 per cent over the past two years. Youth unemployment is now at its lowest level for 25 years. That is a substantial achievement. However, we cannot be complacent about it. We have to continue to invest in the New Deal and continue to make sure that the maximum number 928 of young people come out of the New Deal, get a job and sustain that job, so that they stay in the labour market. It is also important to make sure that those young people are employable over the long term. That is why the acquiring of skills is so important and why the Government are investing a great deal of additional funding in further education and intermediate skills levels right across the UK.

Baroness Sharpies
My Lords, how much has the New Deal cost over the past two years?

§ Baroness Blackstone
My Lords, the average cost of a New Deal place is £2,000. The average cost of a young person getting a job through the New Deal is £4,000.

§ Baroness Sharp of Guildford
My Lords, is the Minister aware that the New Deal has been least successful in some of the inner London boroughs in bringing young people back into stable employment? Has she any explanation for that?

§ Baroness Blackstone
My Lords, I do not quite know what the answer is, or why youth unemployment in London has proved to be more intractable than in some other parts of the country. Youth unemployment is particularly high in London, as is unemployment generally. It is sometimes thought that unemployment is especially high in the north-east, for example, but London is one of the blackspot areas. The situation is being evaluated and examined. I shall be happy to write to the noble Baroness if we have any further information about the specific case of London and why the problem is greater there.