Unemployment

Ben Gummer Excerpts

Wednesday 14th December 2011 Commons Chamber

[Albert Owen]

I shall tell the hon. Gentleman my background in a moment—I certainly know what unemployment is like and have worked with unemployed people—but month on month, people are losing their jobs. Saying that there is hope in future of a scheme—he says it is well thought out, but nobody has seen it implemented—is a disgrace when the Government are doing away with schemes that were working and helping people. I met people who went on those schemes. They had the opportunity in a major global recession to gain work experience and skills. That is what the Government should be doing; they should not be talking about some generous scheme of the future that we do not know about.

The Government’s record is one of increasing unemployment, which compares with the Government of the 1980s and 1990s. The centre for the unemployed where I worked was established in the 1930s, and was re-established in the 1980s because of mass unemployment and mass depopulation. People left my area to look for jobs in the 1980s and ’90s as they did in the 1930s. The county of Anglesey, which I represent, was the only county in Wales that had a declining population in two consecutive censuses, because people went looking for work. Yes, they got on their bikes, but it harmed our community. Unemployment is not a statistic to bandy around in the Chamber; it involves real lives and real people. It affects individuals, families and communities. I have seen communities scarred by mass unemployment, which is why I am passionate about standing up here today to say that this Government’s policies are not working. We need to work together to find policies that work. When the Government scrap policies that have been successful in my community, I will stand up and say so—that is the reality of the situation not only in my constituency but in many parts of the country.

In 1992, unemployment in my constituency stood at 3,912—nearly 4,000. By October 2002 it was down to 1,516, and by October 2007 it was down to 1,093, because schemes that targeted the hardcore unemployed to help them back to work were introduced.

I remember that there was no plan to help in the 1980s. In 1992, the Chancellor of the Exchequer said that unemployment was “a price worth paying”—it was an economic tool. The Minister shakes his head, but those were the Chancellor’s words, and he cannot contradict that because they are on the record. The Chancellor said that there were shoots of growth, but people were losing their jobs and livelihoods, and communities were being destroyed.

The buzzwords of the ’80s and ’90s were “downsizing” and “redundancy”. We needed a scheme, and when the Labour Government came to power in 1997, we introduced the new deal for the unemployed. A levy from the excess profits of utility companies was used and targeted to help young people. Between 1999 and 2004, it was hugely successful. I think it should have continued, but after 2004 the scheme was targeted at other sections of society that needed help. With hindsight, perhaps we should have continued to concentrate on young people.

Youth unemployment has gone up in the past 12 months, whatever statistics we use. Young people are losing their jobs or are not able to enter the employment market. My daughter’s peers, who are in their 20s, have taken extra university courses because they cannot get jobs. They are coming out highly qualified and cannot get jobs. That is the reality of the situation today. It is incumbent on us all, whichever party we represent, to get the number down. Although bandying statistics does not help, we must, none the less, use the records of different Governments to paint a picture. The record of this Government is to do away with schemes that were successful and to say, “We’ll replace them with something in the future.” The reality is that unemployment is going up.

[Ben Gummer (Ipswich) (Con)]

rose—

[Albert Owen]

I am afraid that I do not have much time; I have already taken two interventions.

In the 1980s and 1990s, there was a period of stagnation in my constituency. The gross value added, or the gross domestic product, was among the worst in the United Kingdom. The historical scar is there and people are finding it difficult. Between 1997 and 2007, the number of jobs increased by some 7,000 and many skills were brought back to the area through various schemes. There was a partnership between Government, the public sector, the private sector and the voluntary sector, all working together to help people. That is the way forward.

I accept that unemployment went up in 2007, but it started to come down in 2010, which is important. When this Government took office, growth was increasing and unemployment was coming down. The trend has now been reversed and we are back to what it was like in the 1980s, and once again we are facing mass unemployment. Some 2.64 million people are unemployed, which is a disgrace for any Government. This Government should apologise for the fact that their policies are not working.

The Welsh Assembly Government are introducing additional projects to help the unemployed. Austerity alone will not create jobs; it is getting people skilled up and giving them the necessary experience, growing the economy, and bringing down unemployment that will increase the GDP and the GVA of every part of the United Kingdom. Wales has been hammered by unemployment. We need to move forward. Today is a bad day for unemployment and a bad day for this Government’s record.

--- Later in debate ---

[Dr Whiteford]

I am certainly happy to look at that because the sharp increase in unemployment in Scotland is very concerning. However, over the past year as a whole, unemployment in Scotland has fallen and employment has risen. That compares very favourably with the record of the hon. Lady’s Administration. For most of the past few years, employment in Scotland has outperformed employment in the rest of the UK. That record contrasts sharply with the situation when Labour and the Liberal Democrats were in coalition in Scotland.

We have to look at the big picture and remember that when the Government set us down the path of austerity a year and a half ago, many of us warned that taking the feet out from under the public sector was not the way to boost employment and growth in the private sector. We said that the cuts went too far too quickly and it gives me no pleasure whatever to be proved right on that front. It is now abundantly clear that the medicine is not working and is not achieving the results we want. I accept that the Government have not been in control of some of the external circumstances, but nevertheless those risks were always apparent. The Government need to acknowledge that their plan is not working and that it is time for a change of direction.

What has been disappointing this afternoon is the very ideological and doctrinaire approach taken by Members on the Government Benches to their prescriptions. It would be helpful if we acknowledged the interdependence of the public and the private sectors. The bottom line is that the UK as a whole is losing public sector jobs faster than the private sector can create them. We all know that borrowing is still very difficult for small and medium-sized enterprises, which is a major source of potential growth. We know that business confidence is low, but in that circumstance it makes no sense at all to punish the public sector when the private sector just cannot keep up.

Paradoxically, that is the opposite of what has been happening in Scotland. One of the interesting things—

[Ben Gummer]

Will the hon. Lady give way?

[Dr Whiteford]

Not at the moment, thank you.

It has been evident in Scotland over the past year that the growth of private sector employment has outweighed falls in public sector employment. We now have the highest share of private sector employment that we have had since the advent of devolution. [Interruption.] Although unemployment has fallen across the piece in the past year, it shows that the Scottish Government’s decision to boost investment in the public sector and in infrastructure as far as possible has been a way of offsetting the problems of investment that have been apparent in other parts of the UK—[Interruption.] If the hon. Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann) wants to make an intervention, I am happy to accept it. If not, perhaps he could stop heckling.

If we are serious about tackling unemployment, we need to accept that the cuts introduced by the Government are biting very hard indeed across the whole UK, and that the announcements in the Chancellor’s autumn statement do not go far enough. Crucially, they will not address the immediate challenges of high levels of unemployment and a high benefits bill. I am not sure how we will pay for that in the current circumstances.