Jobs and the Unemployed

Julian Sturdy Excerpts

Wednesday 7th July 2010 Commons Chamber

[Julian Sturdy (York Outer) (Con)]

I shall try to be brief, as I have been told, and I will certainly keep my comments shorter than some of the contributions made last night.

I am grateful for the opportunity to contribute to this debate on support for the numerous measures already taken by the new Government to assist the unemployed and encourage the creation of new jobs, particularly in the private sector. Let us be clear: we face an extremely difficult employment situation. The dire economic recession has seen unemployment jump to just under 2.5 million, while the number of inactive people of working age has increased to a record high of 8.2 million. To put it simply, we cannot continue to sustain such economic inactivity.

A new approach is required, and key to any lasting Government support will be the creation of an economic environment in which private enterprise can compete and invest with confidence. I therefore welcome many of the measures in the recent emergency Budget which are designed to do just that. For example, lowering corporation tax to 20% will attract new business investment to the UK while giving us the lowest rate of this form of taxation in the G7. Meanwhile, combining that move with the small business rate relief will benefit more than 500,000 businesses up and down the country. If we are serious about driving down unemployment, we must welcome such moves to drive up private sector competitiveness.

In addition, if we are to achieve true economic recovery, we must ensure that those areas of the country whose economies were unbalanced even before the recession receive additional focus and Government support in the recovery. The sad truth is that regional disparities grew under the Labour Government. In my region of Yorkshire and the Humber, workplace-based gross value added per head increased by only 18.5% between 1997 and 2008, compared with a 37% increase in London in the same period. Indeed, all northern cities experienced slower rates of economic growth than the rest of the UK in the past decade. Frankly, if the Labour Government’s aim was to support the economies of the north, they failed. In contrast, the new Government have already announced that a new £1 billion regional growth fund will be set up in 2011 to help those areas that will be especially affected by reductions in public spending.

Another unfortunate aspect of Labour’s legacy was to leave areas completely dependent on public sector employment. That cannot be allowed to happen again, and I urge the new Government to do all they can to encourage the transition to private sector-led investment and growth locally, regionally and nationally. Empowering local communities will involve empowering individual business owners. By providing small and medium-sized businesses outside London, the south-east and the east of England with tax relief on national insurance contributions, the Government are indeed encouraging small businesses to employ and expand in the next three years, particularly in the neglected areas I discussed.

In addition to providing support to business and encouraging private sector-led employment and growth, it is also necessary for the Government to provide support for those who find themselves unemployed. Measures must be taken to ensure that a negative cycle of dependency does not take hold in the areas that suffer the most unemployment. Support must be targeted and streamlined, because for too long, the previous Government’s various employment schemes were overly complicated, frustratingly bureaucratic and woefully inefficient. Owing to the number of schemes, people slipped through the net and were lost in the system or not contacted. The new Government’s Work programme needs to be accessible and straightforward, so that anyone who finds themselves unemployed can get the help and advice they need swiftly and effortlessly. Support for the unemployed must be personal, local and flexible, and it must put the individual first.

Launching the Work programme, delivering personalised support to the unemployed, cutting corporation tax and introducing regional growth funds are together the ingredients for a far more business-friendly environment in which our economic recovery can take place. The recovery, however, is far from secure, and it is essential that the Government continue to address unemployment and job creation with the same vigour and determination as they have shown to date. I strongly believe that the initial measures taken by the coalition are setting us on the right course. However, those policies need to be implemented swiftly and reviewed regularly if we are to have progress on the ground.

I urge the Government boldly to push forward on this crucial matter. We have inherited a horrendous financial situation, and only the most robust and ambitious policies will get us back on the road of rising employment, job creation, economic stability and long-term growth.