Jobs and Social Security

Margot James Excerpts

Wednesday 28th November 2012 Commons Chamber

[Mr Duncan Smith]

That is simply not true. I do not want to spend any longer on this, but the point that I made earlier about the right hon. Gentleman’s figures was that, when he concocted the figure of 200,000, he stripped out of his achievement figures the numbers for those who had been on employment and support allowance and so on and divided the total that was left, but those figures were in the other total. The Opposition have made a mistake and need to reckon that their adding up is wrong. The truth is that we have a programme that is helping people who are long-term unemployed.

[Margot James (Stourbridge) (Con)]

I visited EOS, our local provider in the black country, which gave me data to show far in excess of 5% getting back into work. Those data were more recent than the statistics that are being publicised, and I am very encouraged by what the Work programme is doing for people in the black country. Before 2009, the number of people on JSA in my constituency rose by 205%, which was a scandal. That figure is much reduced now.

[Mr Duncan Smith]

The truth is that the previous Government did next to nothing for the seriously long-term unemployed, and as I have said, we saw the figure rise by nearly 400,000. I want to come to that point in a second, but let me first deal with another comment made by the right hon. Member for Birmingham, Hodge Hill during his speech. He said that Labour’s unemployment scheme was a roaring success. I noticed that in Prime Minister’s questions today—I do not know whether I have got this wrong—the Opposition quoted a report that they said had been done by the DWP.

Let us deal with that point now: both the future jobs fund and the flexible new deal were rushed through just before the election. After all the years for which Labour had been in government, it suddenly discovered an urgent need to start to spend money on some programmes. Let us deal with them one at a time, and with the future jobs fund first. The Leader of the Opposition quoted a DWP report earlier and said that that scheme had a net benefit to society of £7,750. What he did not say—I suspect that he needs to speak to the right hon. Member for Birmingham, Hodge Hill next time he gives him something to say at Prime Minister’s questions—was that the report goes on to state that

“these estimates exclude the cost of administering the programme and the cost of hiring and training participants.”

I wonder why he did not quote that.

Using any one of the more conservative estimates, as used in the report in table 5.3 on page 62, puts the benefits at £4,650, less than the £6,500 that it cost to place people in those jobs. So the right hon. Member for Birmingham, Hodge Hill and the Leader of the Opposition unwittingly misled the House and the future jobs fund lost money, rather than rescuing the situation. The report goes on to state that

“it is notable that under all of the scenarios considered in this analysis, the programme is estimated to result in a net cost to the Exchequer”

and

“depending on the rate of decay there might never be an estimated net benefit to the Exchequer.”

What the Opposition are saying is fundamentally wrong: their scheme cost money and did not as a net benefit get anything back to constituents.

--- Later in debate ---

[Margot James]

Will the hon. Gentleman give way?

[Mr Sheerman]

No, I am sorry.

Intergenerational worklessness is a dreadful scourge. We all see it on some of the estates that we represent, and we hate it, so what are we going to do about it?

We have to say, on an all-party basis, that nobody under the age of 25 should be unemployed. We should not let them down in that way. Every young person under the age of 25 should be in work, in training, or participating in a programme; I do not care if we call it the new deal, the new new deal or the Work programme. They should be in a routine of getting up in the morning, going to work and doing something creative, whether it is in the community or helping in hospitals. We have got to the stage where we are moving very quickly towards the participation age rising to 17 or 18. Neither the former Government nor this Government have seriously tackled what young people with a lower level of skills are going to do in the extra year. That is a challenge for those on both sides of the House. I once said that to my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown), but he got very cross with me for pointing it out, and asked what I wanted for these young people. I said that I wanted for them what rich people have—a personal trainer and a life coach—and he thought I was mad, but never mind.

I want to abolish unemployment for those under 25 and to get people out of that routine. I want to get rid of intergenerational worklessness, with a fundamental change in how we allow people to live that half life. My plea is that across the parties we should agree on a programme that gives all our young people the opportunity to live a full, democratic life.

--- Later in debate ---

[Nigel Mills]

One problem of the Work programme is that the year we are looking at contained the second part of the double-dip recession. We all accept that it is hard for anyone to find work in a recession, let alone those who have been out of work for a long time and have the most barriers to overcome. We hope that as the economy gathers strength in the coming year, that will give the Work programme even more chance of success in meeting its second-year targets.

[Margot James]

My hon. Friend draws attention to some of the similarities between the Work programme and what went before. Does he agree that one key difference is the remuneration paid to Work programme providers? They get a £300 attachment fee when someone is referred to them, but do not receive further remuneration until a candidate has been in work for six months. That provides a huge incentive—along with the fact that some applicants will have their benefits docked if they do not co-operate—and makes the Work programme a greater success than what preceded it.

[Nigel Mills]

I am grateful to my hon. Friend. The motion suggests that people would have been better off without the Work programme and with no extra support, but the support it provides is valuable and not entirely different from that provided in previous programmes. Payment by results, which I will come to, provides a far greater incentive to providers to get people back into work and, most importantly, not just to start a job but to find a sustainable position where they can remain for a long time. That is a key part of the programme.

The Work programme also fixed the problem of providers going for low-hanging fruit and getting back into work those who could do so most easily, while not placing quite the right focus on those who were more challenging. Remuneration for the Work programme means there are far more incentives to focus on the harder parts of the cohort.

Like my hon. Friend the Member for Stourbridge (Margot James), I have visited providers in my constituency—A4e and Ingeus—and I have seen their work and how they go about it. Importantly, somebody does not come through the door on the first day and start applying for jobs on the second; there is a long period of working out a person’s needs, what support they have, the training they need, and building their confidence, before they start applying for jobs. One does not expect providers to get people into work in the early months of their referral, which is why there is a problem with the statistics. We are looking at numbers of people who have been in work for six months of a programme that has existed for 13 months during a double-dip recession. The providers might not have even tried to get some of those people into work at the start of the programme—it is not a fair measure. Providers in my constituency are doing great work and the support they provide is valuable. I commend them on that, rather than saying that their work is worthless or worse than nothing.

No one would pretend that yesterday’s results were anything other than disappointing and concerning. We all wish that progress was quicker, and the whole House wants to get people back into work to improve the quality of their lives and for the sake of the taxpayer. However, the Work programme is a seven-year programme that gives individuals a two-year programme, and it is unfair to judge it on the basis of its first-year performance. We should look in a year’s time when the first cohort has spent two years in the programme. Let us look at the outcomes after the full two years, and see how many people are in work at that point.