Jobs and the Unemployed

Debate between Nadhim Zahawi and Thomas Docherty

Wednesday 7th July 2010 Commons Chamber

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

I want to talk about one of the biggest challenges that the coalition Government, the House and the country face: jobs and unemployment in our country, and what the Government can do to tackle them. The Opposition motion would be hard to support in any circumstances, but it would be more credible if it had started with an apology. Nearly 2.5 million people are now unemployed. To put that in perspective, that is 500,000 more than the entire population of Slovenia, a nation that we recently played in the World cup. That is a terrible figure, and also a terrible legacy to have inherited from the previous Government.

[Thomas Docherty (Dunfermline and West Fife) (Lab)]

Will the hon. Gentleman give way?

[Nadhim Zahawi]

I will not, as I would like to make some headway in my speech.

Following the election of the new Government, it immediately became clear to us that we faced a series of immense challenges in tackling unemployment and worklessness. Let us be honest—those problems have not come about purely because of the recession. Over the past decade, the very fabric of this nation has been altered. This is now a nation of huge government and huge inefficiency, and one that does not do much for those looking for work. Instead, it seems to encourage those who do not want to work. Those factors have undermined this country’s competitiveness, its efficiency and—perhaps most importantly—its social fabric.

This is a self-aggravating situation. Those who are brought up in workless households are themselves more likely to experience worklessness, welfare dependency and poverty in later life. This is not an issue we can ignore. It is vital that we address the causes and begin to secure solutions to these enormous problems. That can be done by making changes to the way in which the welfare state is operated. My right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith), the Secretary of State for Work and Pensions, alongside the right hon. Member for Birkenhead (Mr Field) and John Hutton, the former Member for Barrow and Furness, have the historical credibility and experience to make a real difference. Focusing on key issues such as the long-term unemployed and the high level of youth unemployment is critical.

Business is another key area in which a real impact can be made. Supporting our businesses and reducing the regulation that strangles them will lead to more opportunity and more jobs. That is a tried and tested solution and one that I, as a business man, will address shortly, but for now I feel that I cannot ignore the record of those sitting opposite me. After 13 years of a Labour Government, huge numbers of people are living off the welfare state. A whole swathe of society has been led to believe that the culture of aspiration and hard work on which Britain has long prided itself can be ignored in favour of welfare and idleness. Yet I do not blame those people, because it is the last Government who allowed that culture to become ingrained in the British psyche. It is the last Government who bloated not only the welfare state but the public sector. I would never accuse them of doing that for reasons of self-interest, but the questions have to be asked: why was it allowed to happen, and what can we do to rectify it?

Let me turn briefly to the figures, for they do not lie. As I mentioned earlier, unemployment is now just shy of 2.5 million, with nearly 1.5 million people claiming jobseeker’s allowance. We also have 1.7 million people who are long-term unemployed, having been without a job for at least 12 months. Of those, 1.4 million have been on out-of-work benefit for nine or more years; that is a deep rut that is hard to climb out of. I should also make it clear that that does not take account of the 2.6 million people in receipt of incapacity benefit and employment and support allowance. Ours is the nation with the highest number of workless households in Europe. There were 5.9 million working-age benefit claimants in November 2009, and we have an incapacity benefit system that makes it more likely that those on it will die or reach pension age, rather than getting another job after two years of claiming. That is the legacy we have been left.

The last Government have clearly failed. They led this great nation for 13 years, and that is the record that has been left. They may point to and blame the recession; they may claim that factors out of their control led to this situation; but I say no, they cannot so easily shirk the responsibility that the people of Britain placed on them in 1997. They claimed that they would take “Britain forward not back”, yet it is backwards that we have gone: back to the dole queue, back to unemployment, and back to poverty. It is now up to us, the coalition Government, to rectify the mistakes of the past and ensure that once again we “Get Britain working”.

Of course, an enormous number of areas must be discussed if we are both to understand and to begin to deal with this problem: the welfare system and what we can do to change and streamline it, the huge problem of youth unemployment, and what we can do to help lone parents back into work. But as a business man myself and a keen believer in the power that enterprise in the UK has in job creation, I intend to focus on that area. I am a firm believer in creating real jobs in the real economy. We have made it clear that a key element of our programme is boosting economic growth and, as a direct result, creating jobs to ensure that Britain has an economic climate in which private enterprise can compete and invest with confidence. It is vital that we ensure that jobs are available both for those looking for work, and for those whom we will try to get into work.

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[Nadhim Zahawi]

My hon. Friend is right, and that is one of the areas I am passionate about.

[Thomas Docherty]

I am deeply puzzled that the hon. Gentleman argues, on the one hand, for less intervention and regulation, and on the other that the privately owned banks have to be instructed to lend more money. Which argument is he making this evening?

[Nadhim Zahawi]

That is not the point I was making. If the hon. Gentleman had been listening carefully, he would have realised that my point is that we have to inquire into what is happening. I am not talking about instructions, but about understanding the dynamic so that we can create a similar environment to that in Silicon valley, for example, where people can get access to funding more easily than in our country.

As a business man, I also know first hand the damaging effects that over-burdening business with regulation has on British companies. It is imperative that we reduce regulation. The coalition Government aim to do just that. The level of regulation in this country is simply staggering, and another example of the top-down bureaucratic approach taken by the last Government. The Institute of Directors has estimated the annual cost of regulation to UK business at £80 billion, and has stated that the ever-increasing burden of paperwork hinders business from growing and, ultimately, creating jobs. That is why we have announced plans fundamentally to review all regulations scheduled for introduction over the coming year. We will put in place a system of sunset clauses so that regulations cease to be law after seven years, and we have also created the one in, one out rule to reduce for ever the regulation created in Whitehall. All of these are key measures in ensuring that our businesses have the opportunity to thrive and, more importantly, to hire.

The level of unemployment in this country is a huge problem, but I am confident that, with the new coalition Government in power, we can address and reduce it. This issue requires a complete set of solutions, all of which need to be implemented together in an effective and decisive manner.

If we balance the books of Government, hold down interest rates, encourage business to invest and reduce the regulation that strangles business, I believe that, at the very least, we will ensure that there are jobs available for those who want them and an economy that can support them.

I support the amendment to the motion.