Remploy Workers

Nia Griffith Excerpts

Wednesday 26th November 2014 Westminster Hall

[Nia Griffith (Llanelli) (Lab)]

I congratulate my hon. Friend the Member for Wrexham (Ian Lucas) on securing the debate. It is pertinent to remember that it is in meeting people and experiencing their despair in a very difficult job market that we see the personal side of the Government’s decision. Although I will address my comments to a broader economic perspective, we must never lose sight of the effect on the individual. The difficulty is that the actions the Government have taken in closing the Remploy factories and the lack of support they have given to workers to find new outlets for employment have happened against a backdrop of the destruction of the economy in the very parts of Wales where those workers are looking for jobs.

Former Remploy workers face some of the greatest barriers. Recruitment agencies inevitably go for the people who can be most flexible, because that is the type of job market we have. Former Remploy workers are often based in areas with the least transport connections to other job opportunities—that is why the factories were set up in the first place.

From the figures we have, we know that the tops of the valleys—the areas that are furthest from the job markets—have suffered most under the Government’s tax and welfare reforms. The knock-on effects on those local economies make it particularly difficult for anyone who faces barriers to travelling or being employed. That particularly affects former Remploy workers.

A Sheffield Hallam university report recently analysed the effect of the tax and welfare reforms on Wales. It showed that they are taking £1 billion out of the Welsh economy and that the people in the least well-off communities are suffering most. Because those on the lowest incomes spend their money quickly in their local economy out of necessity, the knock-on effect of the loss of £1,000 a year of income per working adult—if there are two adults in a home, that is £40 a week—has been net losses of 7,000 jobs in the local service industries in Wales. That is purely as a result of those reforms.

Even before Remploy people came into the market, the number of jobs was decreasing, so before new jobs can be created, it is necessary to overcome the loss of jobs in those areas. Inevitably, spend is in the bigger towns, meaning that there is even less in some of the deprived areas where there is the most difficulty in finding any opportunities for people to get new employment. That affects anyone who faces any barriers to the workplace, which is the case for many former Remploy employees.

[Ian Lucas]

Does my hon. Friend agree that, in addition to the difficulty in securing work, the income of those in work is falling? That means that the spend in the local economy is decreasing, which adds to the depressed nature of the economy in those areas.

[Nia Griffith]

Absolutely. The way in which the Government have implemented their tax credit reforms means that many working people have lost out significantly. Add to that the fact that 7,000 whole jobs have been taken out of the economy, and the result is that many people have fewer hours and fewer shifts, so they have less to spend. At the same time, they are hit by high fuel prices, which the Government are not doing anything about. They cannot avoid paying them, so they have less money to spend in the local economy. In fact, four times as much money has been taken out of the Welsh economy as comes in from the EU grant to the valleys and west Wales. That has a significant knock-on effect.

What is sad is that we recognised that this was a difficult time, which is why the Welsh Government wanted to step in to do their bit to support the Remploy factories and look at ways to help. The Welsh Government have put in support through the employer’s support grant, which encourages employers to take on additional workers, and there has been some success in the Swansea area in setting up successors to the Remploy factories. However, the climate is difficult and those measures cannot account for all the former workers. Therefore, although we have one or two successes to celebrate, they are not sufficient. There are Remploy workers in my constituency who have not been re-employed in any way.

We want a much more determined effort by the Government to help the individuals concerned. In the Welsh Affairs Committee report on the Government’s Work programme in Wales, we did not find that the work being done was successful. The success rate for people with disabilities getting jobs in the Work programme was 5%, which is below the national average of 7%. That shows the scale of the problem: only one person in 20 is being found a job opportunity. A huge failure of the Work programme is its ability to address people who are former Remploy workers and those who might have looked to work in the various opportunities provided by the Remploy factories.

While the Government have thrown out the Welsh Government’s proposal to take a more positive approach to the Remploy factories, they have not put anything else in place that would lead us to jump for joy and say, “What an excellent idea.” There seems to be a failure. Oxfam Cymru suggested that, in some instances, those in the more-difficult-to-find-jobs-for category are being parked. That is a damning statement.

The worry is not only that there is a total failure to identify and help people who have specific disabilities, but that, within the greater economic context, the Government’s decisions have made it difficult for poorer areas to generate employment opportunities. In fact, those decisions have exacerbated the problems in those areas where we are trying to find employment opportunities, where there have been major job losses, and where there are difficult economic circumstances. At the same time, the Government programmes are not working to help the people in those areas.

We praise those employers who have made an effort, who are trying to take on people and who are trying to accommodate people with different forms of disability. However, even in the harsh reality of the present time, the evidence given by Remploy to the Welsh Affairs Committee shows that there is such a large number of temporary, short-term and short-hours types of employment that that situation is creating a huge difficulty. That reminds us why the form of employment at Remploy, with a proper timetable, proper week and proper factory to work at, was so important, particularly for people for whom routine is essential.

Former Remploy workers face travel problems in my area. They must cope with difficult travel arrangements to get down to the various centres, which makes things even harder for them. The result is that some do not attend those centres—it is simply impractical for them to do so.

When the Minister responds, I ask that he comes forward with positive ideas, because we would like a significant improvement in the outcomes for Remploy workers, and we would like the Government to take the initiative.

--- Later in debate ---

[Mr Harper]

The deficit has been reduced by a third compared with the position that we inherited from the previous Government. The hon. Gentleman can ignore those fiscal realities, but there are now 2 million more jobs in the private sector. The most recent set of statistics contained the excellent news that the number of disabled people in work has increased by 259,000 over the past year, and that the employment rate for disabled people has also increased. There is more to do of course, but that is welcome news.

It is worth putting on the record the financial position that was faced by my predecessor, my right hon. Friend the Member for Basingstoke, when she had to confront the challenges. Two factories were specifically referred to in the debate. The Wrexham factory, referred to by the hon. Member for Wrexham, was losing £878,000 a year in 2011-12. The Croespenmaen factory, referred to by the hon. Member for Islwyn (Chris Evans), was losing £889,000. I do not deny that they may well have won some contracts and increased their business, but the truth is that those factories were losing a significant amount of money.

That is important because that money—around £25,000 a head—was being spent on a small number of disabled people when thousands of disabled people in all our constituencies were not benefiting. If that money had carried on being spent, it would have put at risk the Government’s other employment programmes. We have increased the amount being spent on the Access to Work programme, and we are increasing the resources going into both the Work programme for employment and support allowance claimants and Work Choice. If we had not taken these decisions on the Remploy enterprises that were losing money, those programmes would have been put at risk. The entire Access to Work budget is £108 million a year, which is less than the Remploy factories were costing. The situation was simply unsustainable.

The decisions were difficult. In this very room, the right hon. Member for Stirling (Mrs McGuire), then the Minister with responsibility for disabled people, had to set out and defend her Government’s policies to some of her colleagues. She received my support, because she was doing the right thing. Even if they are from an opposite political party, Ministers who do the right thing deserve support.

Looking back at the decisions that we made, various organisations were supportive of what we did. Disability Wales said at the time that it

“endorses the promotion of fully integrated services and does not see Remploy as either progressive or forward thinking in their approaches to service provision”,

and that Remploy

“are now standing in the way of full integration and indirectly hampering individuals’ chances of progression.”

Those are not my words, but those of Disability Wales. Disability Rights UK said:

“We appreciate that the Sayce Review has caused some concern for disabled people and their trades union representatives working in Remploy factories. However, we believe segregated employment for disabled people is unacceptable.”

On Monday, I was at a Scope event with the shadow Minister and spoke to several representatives from disabled people user-led organisations, all of whom told me that closing the Remploy factories and moving away from segregated employment towards supporting people in mainstream employment were the right things to do.

We have put aside more support for disabled people, not less. The hon. Member for Wrexham said at the beginning of his remarks that we were spending less money on disabled people and that he would go on to set that out, but I did not actually hear him do so. We are spending £50 billion on support for disabled people through things such as personal independence payments and ESA. We have signed up 1,100 employers to our Disability Confident campaign in order to increase the chances of disabled people finding work. The employment figures bear out that that is starting to be successful.

[Nia Griffith]

Will the Minister elaborate on exactly what he will do to help those Remploy workers, mentioned by my hon. Friend the Member for Wrexham (Ian Lucas), who are currently unable to access work opportunities? Will he also explain why he did not take up the Welsh Government’s offer to try to put things right? Nobody is pretending that everything was perfectly okay with the way that Remploy was run previously. Nobody is saying that. However, there have been opportunities to create social enterprises, but it seems as though the Government have deliberately turned them down—

[Mr Dai Havard (in the Chair)]

Order. The intervention is a bit too long. I think the Minister has a grasp of the questions.