Jobseeker’s Allowance: Interns

Baroness Wilcox Excerpts

Wednesday 30th November 2011 Lords Chamber

[Lord Lucas]

To ask Her Majesty’s Government whether they will require that interns who work for an organisation for longer than two months should be paid at or above the rate of Jobseeker’s Allowance.

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)]

My Lords, the Government have no such plans. Internships and work experience, paid or unpaid, offer an excellent opportunity in helping to bridge the gap between education and the workplace. It is important that we do not close down these opportunities.

We are asking businesses to offer internships openly and transparently and provide financial support to ensure fair access. This financial support could consist of either payment of at least the appropriate national minimum wage rate or alternatively payment of reasonable out-of-pocket expenses in compliance with national minimum wage law.

[Lord Lucas]

My Lords, I am grateful for half a loaf. Will the Government encourage all employers—and notably Parliament—to take on more interns at a time when that would be a service to the nation, particularly those children and young people who cannot afford to go without income? Will she, in the spirit of the youth contract announced yesterday, ask my right honourable friend the Chancellor of the Exchequer to make sure that there are no prosecutions or fines for those employers who choose to make up for hard-up interns the jobseeker’s allowance which they lose by becoming interns?

[Baroness Wilcox]

In answering this Question, I find it interesting to discover that there is no such thing as an intern; there is no legal definition of an intern at all. One is either a worker or a volunteer. Therefore, I can agree with pretty well everything my noble friend has said, because some people will be paid and some will not be paid. In the Chancellor’s Autumn Statement yesterday, my right honourable friend said:

“In order to make the education and skills system more responsive to employer needs”,

the Government would, among other things,

“increase young people’s access to high quality work experience”.

I hope he finds that answer helpful.

[Lord Lea of Crondall]

My Lords, I congratulate the noble Baroness on her high-class piece of sophistry a moment ago about there being no such thing as an intern, when we have been debating it off and on in this House for many months. The issue must be that, if people are doing what anyone else would call work, it is biased in favour of the people who can afford to have mummy and daddy give them enough to live on, as opposed to those people who are not in that position. Therefore, there should be a minimum that people get paid.

[Baroness Wilcox]

Internships can be paid or they can be worked on as volunteers, where we would encourage travel expenses to be paid. We are committed to improving social mobility; we are clear that job opportunities should be based on what you know and not just who you know. We are encouraging businesses to provide internships with financial support to ensure fair access. I am sure that is what the noble Lord wanted me to say.

[Lord Razzall]

Bearing in mind the noble Baroness’s statement that there is no such thing as an intern, why was the Prime Minister auctioning an internship at a Tory fundraising event? Does she not agree—and it is implicit in her answer to the previous questions—that the question of payment for internships is an issue of social mobility? Will she confirm that the Government firmly believe that interns should not be just from the wealthy middle class, but also people who cannot afford to work?

[Baroness Wilcox]

We are concerned that requiring all interns to be paid would actually reduce the number of available internships. With so many of our young people not able to get jobs at this time, we think that anything that will give them experience of the workplace and help them is a very good thing. We want to strike a balance between reducing exploitation and maintaining the maximum number of internship opportunities. As I have said, we are committed to improving social mobility and that what matters is what you know, not who you know. As the Chancellor made clear yesterday, we will work hard wherever we can to support youngsters trying to get into work and get the experience that they so badly need.

[Lord Brooke of Alverthorpe]

The Chancellor announced yesterday that he is asking the public service independent pay review bodies to examine by next July the possibility of introducing regional or local pay. Could the Minister please confirm that the Government have no plans to follow the logic of that and in turn to examine the possibility of paying allowances and benefits, such as the jobseeker’s allowance, on a regional or local basis?

[Baroness Wilcox]

As far as I know, we are sticking with the minimum wage as the basis of what we are doing. Internships are paid based on the minimum wage. Anything which is paid above that is purely a voluntary arrangement. Arrangements made between employers and employees are based upon that.

My Lords, we should never condone exploitation masquerading as internships. I am sure many of us have come across those, not least in the media industry. However, does the Minister agree with me that one of the most effective ways of fostering workplace experience is to get schools and universities to have ever closer links with employers?

--- Later in debate ---

[Baroness Wilcox]

Yes, I agree with my noble friend Lady Wheatcroft about closer links with employers, schools and colleges, and explaining the opportunities available. Often people miss out on opportunities because they do not know about them. Maybe their home backgrounds have made it impossible for them to know, so it is absolutely essential that we get closer links. I do so agree with her.

[Lord Young of Norwood Green]

My Lords, following the point of the noble Lord, Lord Razzall, will the Minister say how she will ensure fair and equal access to internships, regardless of parental income?

[Baroness Wilcox]

There is fair and equal access to internships. We will watch to make sure that we continue it. We have made it clear through updated guidance what internships must provide to comply with the law. As the noble Lord knows, guidance for employers is at businesslink.gov.uk; and guidance for individuals is at direct.gov.uk. There are plenty of places where people can go to make sure that they have got the right information.

[Baroness O'Cathain]

My Lords, will my noble friend consider a proposition that my noble friend Lord Lucas and I have discussed in our office? We propose that if people were brought into an internship, the payment they would get would be equivalent to the benefits that they would receive if they were not working. That would probably be an answer to everybody. If, for example, the benefits were about £40 a week and if that could be transferred to pay them as an intern, there would be a win-win situation for everybody.

[Baroness Wilcox]

I am interested in what my noble friend says. I am sure that if she writes to me, I will be able to have a proper exchange with her on this.