New Deal (Hansard, 9 July 2003)

§ John Healey

The New Deal for Young People NDYP), for 18–24 year olds, and the New Deal for those aged 25 and over (ND25 + ), provide comprehensive support for young and older long-term jobseekers. These programmes have helped to reduce both long-term and youth long-term unemployment by over three quarters since 1997. Almost 430,000 long-term unemployed 18–24 year olds have found jobs through NDYP, while ND25 + has helped more than 145,000 people back into work. Independent research has confirmed the positive impact of the New Deal, Chapter 4 of Budget 2003 (HC 500) provides further information

The Government has extended this approach to support groups that experience particular labour market disadvantage. The New Deal for over 50s, introduced nationally in 2000, has assisted nearly 94,000 people into jobs and has helped increase the employment rate of those aged between 50 and state retirement age to 69 per cent. (winter 2002) from 65 per cent. in 1997.

All lone parents who are not working or working less than 16 hours a week are eligible for a comprehensive package of support through the New Deal for Lone Parents, which has assisted nearly 194,000 lone parents into jobs and helped to increase employment among lone parents from just over 40 per cent. throughout the early 1990s to 54 per cent. (summer 2002). The New 875W Deal for Disabled People has helped nearly 9,000 people into work since its introduction in 2001—the employment rate of people with disabilities stood at 49 per cent. in summer 2002, up from 47 per cent. a year earlier.

The Government has also taken steps to provide further support for local areas with high levels of worklessness. Action Teams have been introduced in 63 disadvantaged areas of England, Scotland and Wales, focusing resources on the long-term unemployed and economically inactive and using these resources in innovative ways to overcome specific local barriers to work. Employment Zones in 15 areas of England, Scotland and Wales allow long-term unemployed people aged 25 or over and their personal advisers to use funds with complete flexibility to overcome individual barriers to work, and have helped over 28,500 people into work. Budget 2003 announced details of further steps to extend the help provided by Employment Zones more widely and to encourage innovation among providers. In addition, the 2002 Pre-Budget Report announced the Government's intention to pilot a programme of intensive support, including accelerated access onto the New Deal after just three months of unemployment, in 12 neighbourhoods with very high concentrations of worklessness from April 2004.

The Government's welfare to work policies have been supported by reforms to strengthen work incentives. The National Minimum Wage (NMW) provides fair minimum incomes from work, and will be increased to £4.50 an hour for adult workers aged 22 or over, and £3.80 an hour for workers aged between 18 and 21 or in approved training, from October 2003. The Working Tax Credit, introduced in April 2003, is designed to help tackle poor work incentives and persistent poverty among working people, providing support on top of the guarantee provided by the NMW. The table below demonstrates how the Government's reforms have increased the minimum income that people can expect when moving into work since the introduction of the NMW in April 1999 and the Working Families Tax Credit in October 1999, including through the increases in the NMW in October 2003.

£
	April 1999	October 1999	October 2003
Family 1 child, full-time work (35 hours)	182	200	241
Family 1 child, part-time work (16 hours)	136	144	184
Single person, no children, 25 or over, full-time work (35 hours)	113	113	158
Couples, no children, 25 or over—full-time work (35 hours)	117	117	187

Note:

Assumes prevailing rate of National Minimum Wage and that the family is eligible for the Working Families' Tax Credit and, from April 2003, the Working and Child Tax Credits.