Unemployment

Nia Griffith Excerpts

Wednesday 14th December 2011 Commons Chamber

[Oliver Heald]

I think that this Government are making a serious, determined and honest effort to help people in very difficult times. The hon. Lady talks as though there is no eurozone crisis and the world is not experiencing the problems it is experiencing, but those problems are out there. This is a difficult time politically and economically, yet this Government are trying to help people.

[Nia Griffith (Llanelli) (Lab)]

Does the hon. Gentleman accept that, in fact, the increase in unemployment in the eurozone has been much slower than the increase here?

[Oliver Heald]

The hon. Lady should talk to young people in Spain, where youth unemployment is very high—as much as 30%, I am told. The same is true in Italy. The fact is that youth unemployment is a European problem that must be tackled in the eurozone and right across the continent.

The Government are concentrating on a Work programme that, after 12 months, gives people individualised help to look at what skills and assistance they need to get them back into work, and that, for the first time, gives the disabled a chance of getting the help they need. That is a good thing. That programme and the youth contract, with its job subsidies and extra incentive payments, are not signs of an uncaring Government.

--- Later in debate ---

[Nia Griffith (Llanelli) (Lab)]

The latest unemployment figures are absolutely shocking: 133,000 in Wales alone; and, in some areas such as the Rhondda, 20 people are chasing every single job vacancy. As we look around our constituencies, we see people losing their jobs because of the Government’s savage cuts to public services, and because private firms that thrived on public procurement are seeing their order books empty. We see people losing jobs in the private sector because consumer confidence is low and demand is down, and we just need to look at our high streets and town centres to see shops closing, including those of big household names and local businesses.

If any programme to get people back into work, such as the Work programme, is going to be successful, and if people are going to have a chance of getting a job, the Government need to get their act together and get a growth strategy—now, before it is too late; now, before any more firms go bust; now, before any more shops on our high streets close; and now, before any more families suffer the scourge of unemployment.

But we see nothing from the Government that will stimulate consumer confidence or demand. On the contrary, we have seen this shameless coalition Government hike VAT up to 20%, despite the fact that just before the election, in April 2010, the Conservatives and the Lib Dems vigorously denied any intention of increasing it. Now, they are ignoring Labour’s calls to cut it.

The Federation of Small Businesses has described the Government’s abysmal attempts at a growth strategy as

“too timid and out of touch with the reality of the UK’s sluggish economy.”

Indeed, back in July the British Chambers of Commerce said that the Government’s deficit reduction plan was

“already dampening demand and adding significantly to the pressures facing businesses and individuals.”

It called on the Government to strengthen their efforts to stimulate growth. Did the Government listen then? No. Are they listening now? No.

We have not seen the long-term strategies or the certainty that firms need in order to invest. Let us take the feed-in tariff fiasco. In my constituency alone, we are losing many jobs, because a new policy has been introduced in only six weeks, just like that, meaning that nobody has the confidence to put up the £10,000 to install solar panels on their roof. What other scheme do the Government have in mind whereby people put up £10,000 up-front to help to secure jobs in their local economy? I do not think they have one other idea.

In Wales we can show Members a better way—the one mentioned in the motion before us is being put into practice by the Welsh Government. The Labour Government in Wales are creating 4,000 jobs a year for young people in the private sector through the Jobs Growth Wales programme; helping to create jobs in the construction sector by continuing to build schools and houses; and helping businesses by making £55 million available in grants and loans to them. The problem, however, is that the Welsh Government are having to do this against the background of UK Treasury policies, which are making it very difficult for any business to flourish. We have a Chancellor who is determined to suck money out of our local economies, making it extremely difficult for local businesses to keep going.

We all know that people on the lowest and most modest incomes spend their money most rapidly in the local community, because they have to for their day-to-day needs, so let us look at a few examples of how the Government are squeezing hard-pressed families and sucking money out of our local economies. First, there is the VAT hike, which I have mentioned.

Secondly, there is the winter fuel allowance. Most pensioners, certainly in Wales and in many unemployment hot-spots across the UK, are not millionaires but need that £100, so they are transferring money that they would have spent in the local economy and putting it by to pay for their fuel. That money is leaving the local economy, with the economy in Wales alone losing some £31 million.

Thirdly, we have real cuts dressed up as freezes, such as those on public sector pay and on child benefit, and they are translating into money that people do not have to spend in the local economy. Fourthly, the 3% hike in pension contributions is taking £2.8 billion out of the economy; and fifthly, tax credits are being taken away from people who work less than 24 hours a week. But people just cannot, unfortunately, get those hours, and they are from some of the very poorest households. They are trying to work and to keep the family together, yet they are going to have even less money to spend and less money to stimulate the economy, so there are going to be even more job losses. The Government must do something now to put that right and get growth going.