Back to Work Agenda

Lord Grayling Excerpts

Wednesday 11th May 2011 Commons Chamber

[The Minister of State, Department for Work and Pensions (Chris Grayling)]

For at least the last five minutes of the hon. Gentleman’s contribution, that was a really disappointing speech. He spent 10 minutes setting out very eloquently the benefits of localism in Rhyl and the work that has been done by the local community to help young people and people of all ages into work. I listened with care, and he was actually making a good argument for the approach that we are taking in the Work programme. In a moment, I will set out how we hope that the Work programme will address some of the challenges faced by towns such as his.

I am well aware of the excellent work that has been done on the ground in Rhyl. It is a good example of how a partnership between providers, local authorities, local business and other organisations to help people into employment can be fruitful. He referred to Working Links, and he will be aware that it is one of the preferred bidders for the Work programme across Wales. It has certainly built experience in Rhyl that can be used in the rest of Wales. However, that was where it stopped, and for the last five minutes of the hon. Gentleman’s speech, one would have believed that we were back to the rhetoric of the 1980s and the Morning Star. We heard a rather outdated view of class war and an apparent belief that Conservative Members and the Government have no interest in helping employment. He could not be more wrong. He needs to understand, first and foremost, the legacy that we inherited.

One would have believed from listening to the hon. Gentleman that the past 15 years were a period of great employment success, but nothing could be further from the truth. We have gone through a long period in which we have consistently had almost 5 million people on out-of-work benefits. Although there have been increases in employment, such as the growth by almost 4 million in the past few years, we know thanks to the assiduous work of the right hon. Member for Birkenhead (Mr Field), who spent a lot of time in the previous Parliament teasing out of the previous Government the reality of the labour market, that far too many of those jobs—indeed, the majority—went not to unemployed people in this country but to people coming to the UK from overseas. That was a great tragedy and a great failure. Billions of pounds were spent on nationally organised back to work schemes that did not deliver the change that we needed.

The hon. Gentleman made a good point when he said that he did not want to see the man or woman coming from Whitehall with a big stick to try to get people into work. I agree with him, but that was the failing of the previous Government’s policy. Programmes were designed in Whitehall, to a template designed in Whitehall and on a contractual basis designed in Whitehall, and they did not deliver the improvement that we needed. That is why we are determined to change things and have brought an entirely fresh approach to back to work programmes. I believe that that approach will help and harness the expertise that has been built up in his town of Rhyl over the months and years.

Let me explain to the hon. Gentleman how the Work programme is designed to work. He will be aware that the contracting of the programme has involved not only individual prime contractors such as Working Links but a network of private small businesses, voluntary organisations, local charities, local groups with expertise on the ground in dealing with unemployment challenges and local public sector bodies. A number of local colleges are also involved in delivering the Work programme. We have decided to say to those providers that it is not the Government who know best how to get people into work, and who are best placed to design the programmes that will work in various parts of the country, it is the professionals on the ground.

We have said that we will leave it to the providers to design what works. We want to encourage them to form excellent local partnerships such as the hon. Gentleman describes as having worked well in Rhyl. The only thing that we ask of them is that they succeed. We have put in place a payment-by-results regime, in which the prime contractors are investing £580 million over the next 12 months. We have confidence in their ability to build consortia of organisations and local partnerships, and in their capability to transform the lives of unemployed individuals around the country. We will reward them when they succeed in getting the unemployed into work. The scheme is designed to deliver the type of localism that he described in Rhyl. We believe that localism can work well around the country, and it is the essence of the Work programme and the black box approach.

[Chris Ruane]

We’ve been doing it for 10 years.

[Chris Grayling]

No, the tragedy is that the Labour Government did not do that for 10 years. There were one or two isolated pockets where there were very good local partnerships, and the hon. Gentleman has described one in Rhyl which was clearly very good, but in too many places that did not happen. Individual communities did not have the type of support that he described. They had top-down programmes designed in Whitehall. The man or woman from Whitehall with the big stick did indeed go down and tell people how things should be done.

I remember that when I held the work and pensions brief in opposition, I used to receive regular e-mails and letters from people who had been referred to the employment programmes that the previous Government had put in place and were hugely frustrated. They were being referred for a 13-week period, more often than not to sit in a classroom for the entire time, with a few lessons on how to fill in a CV and do interviews and the occasional work placement. However, they absolutely did not get the type of diverse programme that the hon. Gentleman described.

I am all in favour of some of the initiatives that the hon. Gentleman mentioned, although I do not know the details of every one. He described young people setting up their own market stalls and unemployed young people rebuilding community centres to gain the skills that they need. I applaud such valuable initiatives.

One thing that excites me when I look at the ideas of Work programme bidders is that we have challenged them to move beyond where they were before. We set a minimum performance standard in excess of what previous national programmes had achieved, precisely because we wanted to drive innovation, new ideas and much more tailored provision. I do not want one-size-fits-all provisions, because, as the hon. Gentleman knows, they do not work. A wide variety of individuals have been on benefits for the long term. He referred to young people who grew up in households in which their parents and grandparents did not work, and who had no experience of a working environment as they grew up. We must help those people back into an understanding of what they can achieve in the workplace. Some older people find that the profession that they spent 20 or 30 years in is no longer available to them. We need to help them to find something different to do with the remainder of their working years.

The Government have actively sought new ideas and a new approach. The exciting thing about the Work programme bids is that there have been real signs of innovation that move beyond that 13 weeks in the classroom and the structure of past programmes.

[Kerry McCarthy (Bristol East) (Lab)]

I appreciate the need to recognise that unemployed people are individuals with individual circumstances, to which the Minister has referred. My concern is that Jobcentre Plus does not always recognise that at a local level in respect, for example, of the new requirement that lone parents seek work when their youngest child is aged seven—the age is eight at the moment. I hear tales of people being told that they are regarded as not looking for work, because they say that they cannot work in the evenings because babysitters are unavailable, or because they turn down a job that starts at 9.30 am and they have to drop the kids off at school on the other side of town at 9 am. Will the Minister reassure me that such people will not be penalised?

[Chris Grayling]

I can absolutely give the hon. Lady that reassurance. She will know that there is a definition of reasonableness in deciding whether somebody should be required to take a job. We only expect lone parents with a child at primary school to take up a job that is consistent with school hours—it would be absurd to expect a lone parent to work a night shift, for example. I absolutely assure her that that is the case.

While we are on that point, I will pick up the point that the hon. Gentleman raised on targets. The truth is that we discovered that problem, were horrified about it and put a stop to it immediately. However, is he aware of the roots of the problem? The roots are in a set of benchmarks that were introduced by Jobcentre Plus regions to judge whether appropriate sanctions were being achieved in each area, why there were differences, and whether policy was being applied uniformly. In an organisation that is, in my view, too target and detail-focused, the consequence was that in some areas, that was interpreted as a need to apply the individual target of which the hon. Gentleman is now aware.

However, the hon. Gentleman might be unaware that the those benchmarks were introduced in 2006 under the previous Government. Jobcentre Plus is much too focused on targets and goals. Benchmarks are turned into individual targets for front-line staff, and the organisation’s culture does not appreciate the fact that we want front-line individuals to use discretion. We are going through a long change process after 13 years. Jobcentre Plus is used to taking diktats from the top, but this Government are saying, “We want you to use discretion in the front line and to take the right decisions in the interests of individual with whom you are dealing. We do not want you constantly to look back over your shoulder to ask what the centre is saying.” That is an important development, but it will take us time to feed through the whole organisation.

Ironically, given what the hon. Gentleman said about targets, that policy dates back to changes made by the Labour party when it was in power. Indeed, last April it changed the rules actively to encourage an increase in the number of sanctions—again, something that we inherited. It is easy to look at the current Government and say, “What are you doing?”, but actually it is a problem which we inherited, which has grown and which we are now trying to unpick.

The hon. Gentleman referred to the future jobs fund. I know that Labour Members are wedded to it, but in truth it cost four times as much per job outcome as the previous Government’s other scheme, the new deal for young people. At the end of the day, given that we have inherited the biggest budget deficit in Britain’s peacetime history, we have to take some hard decisions and look for value for money. The problem with the future jobs fund was that it was a six-month work placement in the public or voluntary sector with no clear pathway through to a long-term career. We took the view that it was much better to invest our money in apprenticeships, where the young person spends an extended period with a private sector employer gaining skills that will provide the foundations of a lifetime’s career and that will not simply lead to a shutter coming down at the end of six months.

We are pretty early on in our apprenticeships programme, but we are already having considerable success in getting employers to take up apprenticeships. I was delighted to go to Newcastle earlier in the week and see the front page of The Journal announcing a great success for the paper’s campaign to encourage small employers to provide apprenticeships for young people. That is the kind of partnership that I really like. I absolutely agree with the hon. Gentleman about the importance of local partnerships. I want local employer groups, papers and public sector organisations working together to encourage young people to take up apprenticeships and to encourage local employers to provide apprenticeships. He will know that we are focused on ensuring that we provide work experience places for young people, but above all we are trying to ensure that decisions are taken locally. In the context of what is being done in Rhyl, there is nothing in the Work programme that prevents that work from continuing. Excellence will flourish in the Work programme. The whole system is designed to give local communities, providers on the ground and local organisations the freedom to do what works for the individual, which is what is important.

In conclusion, I regard unemployment, particularly youth unemployment, as among the most important of this Government’s challenges. I am relishing the chance—