Youth Unemployment

Lord Freud Excerpts

Monday 14th May 2012 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what action they are taking to reduce youth unemployment.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)]

My Lords, the youth contract was introduced in April 2012 to provide additional support, with almost £1 billion, to young unemployed people over the next three years. It builds on the support already available through Jobcentre Plus and the work programme, enabling young people to look for work, gain work experience and skills and find real, lasting jobs.

[Lord Kennedy of Southwark]

My Lords, if it were not so tragic, the lamentable performance of the Government would be laughable. More than 1 million young people are not in education, employment or training. When are the Government going to pull their socks up and do something about this problem, or are they happy for young people to return to the misery of the 1980s?

[Lord Freud]

My Lords, let me just correct those figures. The number of people who are not students and who are unemployed is around 719,000. That figure is much too high but it is not near 1 million. We are doing an enormous amount to help young people into the jobs market, and we are doing it on a structural basis rather than making little fixes here and there.

[Lord Roberts of Llandudno]

My Lords, which Minister in the Government has specific responsibility for co-ordinating their struggle against youth unemployment? That is my first question; I think that I am allowed a second.

[Lord Roberts of Llandudno]

Then I am happy with my first question.

[Lord Freud]

My Lords, my colleague Chris Grayling is responsible for unemployment generally, and of course youth unemployment within that.

[Baroness Turner of Camden]

My Lords, what are the Government doing to stimulate the introduction of apprenticeship schemes in the private sector to make sure that such schemes are available to young people who otherwise would not have appropriate training?

[Lord Freud]

Apprenticeships are one of the key things to help youngsters into the market. There were 457,000 starts in apprenticeships in 2010-11, and 60% of those are for the age group that we are talking about, the 16-24 year-olds. We are pushing apprenticeships very hard, and we have put in a programme to reinforce that with incentives to SMEs: for each apprentice they take on, they get £1,500 a year. That is being financed for 40,000 youngsters.

[The Lord Bishop of Blackburn]

My Lords, in east Lancashire alone there are 5,000 18 to 24 year-olds out of work, of whom 3,000 have been out of work for more than six months and are still claiming benefits. We are very encouraged in my cathedral town of Blackburn that the world of education and the world of business are coming together to try to reduce that figure, but could the Minister give us in the north-west some hope that in the next three months we need not expect to see another cohort of young people adding to that figure of 5,000?

[Lord Freud]

My Lords, one of the things that has changed in terms of looking at young people is that we are getting some real figures that are not disguised, as they were, by people going into training and coming back again. We are counting people who are long-term unemployed as long-term unemployed, and the figure in the country as a whole for those unemployed for more than six months is currently 163,000. That figure is too high but, if you compare like with like, only about 10,000 more than it was when we first came into power.

[Lord Peston]

My Lords, is the Minister aware that unless and until we get a Government who place the restoration of full employment as a central aim of government economic policy, the young people of this country have no hope substantially of returning to work? We need a policy of full employment and not the kind of Elastoplast policies that the Minister is talking about.

[Lord Freud]

I am sure that the noble Lord will agree that the lump of labour fallacy is not how one should run an unemployment policy and that a competitive employment approach is the right approach. The way that one achieves that is by skilling up the workforce so that people can take jobs. That, in itself, expands the economy by more than it would otherwise expand. I am sorry that the noble Lord does not agree. I know there are noble Lords on the Benches opposite who dislike the lump of labour fallacy as much as I do.

[Lord Flight]

My Lords, the apprenticeship scheme is already achieving a lot and can achieve a lot more, but one of the problems is that when people come off jobseeker’s allowance their pay on an apprenticeship is very modest and they often cannot afford the travel costs. The Mayor of London is happily providing the travel costs for apprenticeships in London. Will the Minister look at expanding this where it is needed elsewhere in the country?

[Lord Freud]

I will look at that because one of the central thrusts of our policy is to ramp up apprenticeships. One of the most encouraging signs I saw when I visited a work programme contractor the other day was the way that having sustained outcomes—long-term jobs—is driving it towards putting youngsters into apprenticeships. That is a very happy fact pulling them together, and I will very happily look at anything we can do to reinforce the drive to apprenticeships.

[Lord McKenzie of Luton]

My Lords, will the Minister explain why the Government have taken the decision to exclude disabled young people on the work choice scheme from accessing wage subsidies under the youth contract? Does that not mean that they will be doubly disadvantaged?

[Lord Freud]

My Lords, we are trying to tier a structure of programmes where work choice, which is supported with its funding, is the way that young disabled people are supported.