Welfare Reforms and Youth Unemployment

Baroness Stedman-Scott Excerpts

Thursday 11th June 2026 Lords Chamber

[Baroness Stedman-Scott (Con)]

My Lords, I, too, pay tribute to Lord Younger, our colleague on these Benches who has left the House, not of his own volition. He is a great loss to the House, as are all the hereditary Peers who have left us. I also thank my noble friend Lord Evans very much for making this debate happen. Look at what he has done: we have had a fantastic array of speeches and knowledge. He is now our DWP Whip. I also welcome my noble friend Lady Spielman to our Front Bench; she will be a great asset to our team.

I hope the Minister and everybody in the House have enjoyed the masterclass they have had today on welfare reform and opportunities to help young people into the labour market. I know we have had lots of debates, questions and conversations about the NEET problem. Many judgments have been passed across the House about who has caused it. I hope that we have got past that today and have been able to speak honestly about some of the things that we believe might help the situation.

I am not going to repeat all the statistics in my speech—I have rubbed them out, because they have been put very powerfully—but I will start by talking about the concern that 61% of young people are reported as NEET, which is a record, where economically inactive means that they are not working and are not looking for work and, in many cases, are not required to look for work. My noble friend Lord Young made that point. Can the Minister tell us what proportion of those who are economically inactive are so because they are not required to look for work? I am sure she will have noted Alan Milburn’s warning that the welfare state is “exacerbating inactivity”, which is a point that has been made right through this debate. His argument is that the Government’s new work programmes alone, welcome though they are, will not be enough to address problems that are far deeper-rooted.

So I ask everyone to be brave, think the impossible and take seriously some of the recommendations that have been made today—even by an Etonian, my noble friend Lord Younger, about changing the way in which Jobcentre Plus money and activity are used. I spent 32 years trying to help people to get and keep a job; that is why I got up in the morning, and to some degree it is why I get up now.

I want to tell noble Lords about a meeting I had with a doctor at a conference. He said to me, “Debbie, I’ve got heart-sink patients”. I said, “What’s wrong with them?”, and he said, “My heart sinks every time they walk into the surgery, because I’ve got nothing for them. Can you put your people into my surgery and see what you can do for them?” To cut a long story short, we had 200 people on our books, and we had a consulting room in the surgery, and I am pleased to say that we reduced the antidepressant prescription by over 34% and reduced referrals to counsellors by 86%. Of those whom we got into work, which was around 56% in a year, 76% were still in work a year later. That is the kind of magic, and the kind of energy, that we need to inject into our thinking and our challenges.

The challenge before us all is profound. Now is the moment for us all to work together, as has been said by many people, to improve the lives of the people whom we exist to serve.

I have to congratulate the noble Lord, Lord Walker, on his outstanding contribution. It cannot have been easy to make it, but I say to him: “Well done for your bravery, sir”. I wish we all had it by the bucketload. If the noble Lord wants another job, then that as a speechwriter beckons; I am sure he will be very welcome.

I recognise that the issue of the economy is, at least in part, on the Government’s radar. Policies such as the youth guarantee scheme, while we may have disagreements over them, represent the beginning of a response, but the scale of the challenge demands something far more serious, coherent and ambitious. I thank my noble friend Lord Elliot for his idea, which seems to have caught everyone’s imagination; it is one that we should embrace.

The labour market has changed fundamentally over the past 20 years; the noble Lord, Lord Liddle, said that, as did my noble friend Lady Shephard of Northwold. Our economy now has around 1.6 million fewer lower-skilled and medium-skilled jobs than it once did. Entry-level work is harder to find, if not impossible. Competition for those jobs is more intense and the pathways into stable employment are far less straightforward than they were for previous generations. Technology has changed, and absolute support on an individual basis is really important.

From an employer perspective, the British Retail Consortium has talked about the impact of the Government’s changes on the cost of hiring people. It says—it is not me saying this—that taking on young people is more expensive and complicated, and schemes are not working. We should be brave enough to go back to the drawing board and work out what might work, and I am sure that today’s debate has helped us come up with even more ideas about what is possible. The Government cannot do this job alone; it is incumbent on all of us to work together to do it.

I spent a whole couple of days in Suffolk recently talking to businesses and colleges and to Jobcentre Plus. They were very excited about the prospect of jobcentres merging with the careers service. This has not been mentioned today, but I wonder whether, either in the Minister’s response or in writing, we can be told how long the merger will take, how long it will take for it to become fully operational and what outcomes we are expecting from it.

I want to talk about regional disparities. I agree with everyone who said that national programmes have been good in the past, but they are not right for now. We have to allow local people and local organisations to come up with interventions that work for them. We do not need a national programme, because no national programme can sort it out, but whatever happens must be known nationally and delivered locally, and the impact must be known and felt personally.

Finally, I want to talk about early intervention. We have a NEET problem but, for me, if we want to prevent NEETs in future, we have to start earlier and make sure that no young person leaves education, in whatever form, as a NEET. Another thing that I was involved in was ThinkForward, where we put our advisers into schools to work with young people about whom, at the age of 14, everybody said, “They’re going to end up in trouble; they’re going to end up NEET; they’re not going to get anywhere”. When we worked with them, I think it was the most wonderful thing I was ever involved in.

Eighty-five per cent of those 14 to 16 year-olds showed statistically significant improvements in their attendance, because when they did not turn up for school, we went round their house and got them. Sixty per cent of our school leavers achieved at least five GCSEs grades A to C, and 96% of our 17 to 18 year-olds were, when I left, in further education, employment and training. That NEET problem had been all but eradicated. This is the kind of thinking we need today. Can the Minister set out what the Government are doing on early intervention and how DWP is working with the Department for Education to make sure that happens?

Mental health has been mentioned. I know that young people are suffering anxiety. For those of us who see it with people in our families, it is real and we have to help them.

The other thing I want to finish on, if noble Lords will allow me, is that we need a strong economy. Others more eloquent than me have articulated how that should work and what needs to happen. It is obvious that only employers create jobs. Again, I plead with the Minister: please will she and her Government rethink the additional costs that they have added to business? I am telling your Lordships that if we did something about that now, this problem would start to go away. We need earlier intervention and a vibrant economy, and we need people to think what they dare not think and implement it.

I thank noble Lords for their honest contributions. I hope all contributions have been taken by the Government in the right spirit and that this propels us into action to do the right thing.