HC Deb 01 July 1997 vol 297 cc120-1W
Mr. Rowlands

To ask the Chancellor of the Exchequer what estimate he has made of the impact of the introduction of the jobseeker's allowance upon the reduction in the unemployment figures in(a) the United Kingdom and (b) Wales. [6138]

Mrs. Liddell

The information requested falls within the responsibility of the Chief Executive of the Office for National Statistics. I have asked him to arrange for a reply to be given.

Letter from Tim Holt to Mr. Edward Rowlands, dated 1 July 1997: The Chancellor of the Exchequer has asked me to reply as Director of the Office for National Statistics to your recent question on what the effects are of the introduction of Jobseekers' Allowance (JSA) on unemployment figures for a) the UK and b) Wales. The measure of unemployment, derived from the quarterly Labour Force Survey (LFS), is defined on a consistent and internationally recognised basis set out by the International Labour Organisation (ILO) and counts as unemployed people who are: a) without a paid job; b) available to start work within the next two weeks and c) have either looked for work in the last four weeks or are waiting to start a job already obtained. However, largely because it is a sample survey, information is not available from the LFS in as much geographical detail as from the claimant count measure described below. ONS also publishes the monthly claimant count, which is based on the administrative system and includes all people claiming unemployment-related benefits (i.e. Jobseekers Allowance, Income Support or National Insurance credits) at Employment Service offices on the day of the monthly count, who on that day had signed on as unemployed and available to do any suitable work. Essentially, all people who attend an Employment Service office to sign are counted, irrespective of whether they are actually receiving benefit. There have been two main types of JSA effect on the claimant count figures: 1. Changes to rules - the effect of the main change in the rules under JSA, to means test after 6 months rather than twelve months, is proving very difficult to disentangle from other JSA and real economy effects. The best estimate that can be provided is that this has led to around 30,000 extra claimants leaving the count in the UK since the introduction of JSA. A breakdown of this estimate by country is not available. 2. Behavioural - it is likely that the introduction of JSA has had an effect on claimant behaviour, such as deterring fraudulent claims, but it is impossible to quantify this using available data. The estimates of ILO unemployment properly reflect people's behaviour in the labour market, as reported in LFS interviews, and are not dependent on the receipt of unemployment-related benefits. It is, however, possible that labour market behaviour could have been influenced to some extent by the introduction of Jobseekers' Allowance, although this cannot be quantified.

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