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Column 97through it the triplicate form-filling, the complicated administration of seeking support and getting back to work will come to an end and we shall be able to replace the out-of-date, confusing two-benefit system. That is right. It is long overdue. Undoubtedly, the measures in the Bill will be easier to understand and will streamline administration, which in turn will mean better targeting and improved services for the jobless. In the end, the individuals who are seeking help will feel that one-to-one relationship, which we want to build, so that they have a sense of commitment not only to agreeing to look for work but to those to whom they will be answerable.
I welcome the suggestion that people should sign an agreement demonstrating their commitment to returning to work. That is very important. It is very easy for people to slide into a benefits syndrome without realising that it takes two to tango--the providers of the benefit and the recipients. It takes two to recognise that they have a job to work together to get that unemployed person back into the work force. Signing an agreement emphasises that commitment. It would be of great benefit to build on the programme, which the Government have already started, of working out a planned job search and helping unemployed people with the whole mechanics of looking for work. Making the process more formal and more structured can only be to everyone's benefit.
I also welcome the stick and carrot approach. On the one hand, we have the stick, the commitment and the sanctions as they are applied, and on the other we have the carrot, the tax-free, back-to-work bonus, which will undoubtedly encourage people to leave the benefits system in the long term, particularly those who have been working part-time. The stepping stone of part-time work is an essential part of building up self-confidence, about which we should not in any way be embarrassed or shy. Staff in my local jobcentre are confident that the back-to-work bonus will take off and will work. They are, after all, the people at the coal face and can speak with authority. We were talking earlier about the opportunities of getting people back into work. The good news is that there are more opportunities today than there have been in the past few years. Certainly in my constituency there are more jobs now in the retail trade; in shops. There are more jobs in clerical work. There are also more jobs in the building trade, which is very significant, although, admittedly, those jobs command slightly lower wages than they did in the past. One word of advice that I would give to my right hon. Friend the Secretary of State is that although it is all very well getting the training schemes well established, as we have, we nonetheless need to match them with more work experience. That applies especially to school leavers who, at the moment, in some schools, are put on a two-week job opportunity or work experience scheme, which can work very well. Sadly, not enough schools are pushing that scheme hard enough. To give young people that first taste of the real world of work is an enormous help, not only in training, but because an employer can see that they have had some experience of an office environment.
I am disappointed that the Labour party is still absolutely dedicated to the idea of a minimum wage. It strikes me that that is a windmill which we will have to knock to the ground. Labour Members are raising people's expectations falsely and they are doing no favours to the 2 million people who will undoubtedly lose
Column 98jobs as a result of a minimum wage. I find it strange that even Labour Members have admitted that there are flaws in their own scheme. Indeed, the right hon. Member for Kingston upon Hull, East (Mr. Prescott), when he was interviewed by Brian Walden on London Weekend Television, said:
"I knew the consequences were that there would be some shake-out, any silly fool knew that".
It would be wise if the Labour Government took heed of their own errors in the past. It should be remembered that every Labour Government for more than 60 years have presided over an increase in unemployment.
I trust now that Labour Members will support the Bill and realise, in their anxiety to get people back to work, that the Bill is undoubtedly the best possible chance for all people who are fearful, afraid, need help and need support. We have now got it for them. 8.37 pm
Mr. Paul Flynn (Newport, West): The Secretary of State referred in his speech to the living memory of hon. Members in the House. He may well have been thinking of the strange anniversary, on the seventh day of this month, which marked exactly 60 years since the Unemployment Assistance Board came into being. That board originated from a decision made by Ramsay MacDonald's Government of 1931 to limit the duration of unemployment benefit to six months. It is interesting to think that that system may well be coming back, because then many of the benefits were paid by local authorities. That Government also introduced a system decreeing that unemployed people would have to undergo a means test. That may not be in the memory of many hon. Members, but it is certainly in the memory of my family, as my father was one of the people in that period who underwent that means test, having suffered from a war injury which meant that he never worked again. I remember how embittered he was throughout the rest of his life because, a short while after that means test, the War Department decided to change his pension from an amount which was attributed to his war wound--he was shot--to an amount which was aggravated by his war wound.
The bitterness felt by that generation is about to be reproduced. The Government at the time decided to nationalise the means testing of the unemployed. The Unemployment Assistance Board, which was invented by the then Chancellor of the Exchequer, Mr. Neville Chamberlain--who had his problems later on--applied itself to its task with such enthusiasm that, in the first month of its operation, it brought this country closer to revolt than at any time this century. Hundreds of thousands of families found their incomes savagely reduced. Hon. Members of all parties and from all parts of the country protested loudly.
After only four weeks of the new scheme, the Minister of Labour rose in the House to announce a standstill. The cuts made to that point were cancelled and arrears were paid. Until new regulations could be introduced, the Unemployment Assistance Board was to pay each unemployed person the amount payable under existing regulations or what that person received previously from the local authority. There was rejoicing in the valleys
Column 99because the valleys of south Wales were among the most generous and fair in respect of the amounts they paid in benefits.
Those events are worth recalling because the Government are embarking on a repetition of the actions of their predecessors. Once again, in April 1996, the duration of unemployment benefit is to be cut to six months. That is an exact replica of the earlier system. Benefit rates are to be cut and, once again, there will be a big increase in the number of unemployed people who are subjected to means testing.
We heard the myth from Conservative Members tonight. We heard it principally from the hon. Member for Sutton and Cheam (Lady Olga Maitland), who has just spoken, and from the Secretary of State, when he spoke on Radio 4 the other day. It was difficult to find any room for thought between the Secretary of State's populist rants. Conservative Members continue to talk about taxpayers' money and about a contract.
When the jobseeker's scheme was originally introduced, the Government said that the reason for it was that unemployment benefit was not much different from income support. They are absolutely right about that. The fact that an insured benefit has decreased to the level of the safety net has not occurred by magic.
What has happened is an extraordinary story. The main thrust behind Beveridge was not simply the fairness of a national insurance scheme. He was interested in the efficiency of such a scheme. As Beveridge pointed out at the time, a multiplicity of private insurance companies collected a few pence every week for all kinds of insurance benefit. Fifty per cent. of the premiums paid were dissipated or wasted. The scheme was very clumsy.
That is precisely what is happening now as the Government are trying to force people into highly inefficient private pensions and private benefits in respect of which there are two major problems: first, the schemes pay poor benefits, and 4 million people in personal pensions will curse this Government when they reach old age because they have been forced into such schemes; and, secondly, the people whom the Government are telling to take out schemes to insure their mortgages and to protect themselves from unemployment are the very people who cannot afford the premiums because they are at high risk.
Let us consider what has happened to unemployment benefit over a period when premiums have risen by 40 per cent. and 50 per cent. There has been a huge increase in premiums. However, while there should have been an increase in the rate of unemployment benefit in comparison to the rate in 1979, there has been a decrease for a family of 41 per cent., if we consider the figures in line with prices, and of 56 per cent., if we consider the figures in line with earnings--which is the best line to take.
The Government have taken an insured benefit; they have jacked up the premiums by a huge percentage, but they have cut the amount received by 50 per cent. When the Secretary of State was speaking this evening, I was speaking on the telephone, in a routine call, to a young man in my constituency. That young man was in despair. He had been through the system. He had been on the schemes and had done what the Government had told him to do. He tried to do a training course, but met obstacle
Column 100after obstacle. The latest obstacle related to a job as a professional driver in respect of which he faced an insurmountable premium for that scheme. He is one of the many people who have been through the whole gamut of lost opportunity and who have faced all those blank walls. Nothing in the Bill will help that young man. The Bill is so mean that even the much-vaunted back-to-work bonus, which in principle is not a bad idea and has some merit, is to be affected. On 12 December, the Under-Secretary of State for Social Security, the temporary hon. Member for Monmouth (Mr. Evans), admitted that the Government were going to claw back money from the back-to-work bonus scheme. They are going to make a profit from it. They cannot keep their greedy little hands off it.
The whole point of the wretched scheme is to try to claw back money from the worst-off and to cheat them on national insurance to build up the bribe that the Government hope to offer in the next general election. Everyone knows what is happening. The Government have advertised the bribe so often that it will not work. They should learn that lesson.
Miss Widdecombe: I am intrigued by the hon. Gentleman's comments about the back-to-work bonus. Given that at the moment, over and above the disregard, we take away pound for pound and that, in future, we are going to give back 50 per cent. of the remaining earnings up to a maximum of £1,000, how are we profiteering from the back-to-work bonus?
"Further information is currently being collected to allow this to be assessed."--[ Official Report , 12 December 1994; Vol. 251, c. 535-56 .]
The Minister will have to ask her hon. Friend the Under-Secretary how that is to be achieved, because that is what he said. The Government are treating the whole business as an attempt to disguise a cut in benefits and as a way to force the unemployed into the ritual humiliation described by the hon. Member for Stratford-on-Avon (Mr. Howarth). I crossed swords with the hon. Member for Stratford-on-Avon about the 1920s and Beveridge, but I discovered later in his speech that he knew precisely what the effects of the actively seeking employment test and the other tests were.
Beveridge said that the actively seeking work rule in the 1920s was a humiliating and futile experience. When it was used, unemployed people in south Wales could not receive benefits unless they proved that they had actively been seeking work. Unemployed people from Rhondd Fach had to cross the valley to the Rhondd Fawr and the unemployed from the Rhondd Fawr had to cross the valley to the Rhondd Fach. That simply used up shoe leather. However, they had to get a stamp. A member of the Labour Ministry at the time disguised himself as an
Column 101unemployed person and wrote a book on the subject called "The Myth of the Scrounger" in which he made the point that the only people who-- [Interruption.]
Mr. McCartney: On a point of order, Madam Deputy Speaker. The reason for the muttered interventions is that the hon. Member for Sutton and Cheam (Lady Olga Maitland) spoke for 25 minutes, keeping both Opposition and Conservative Members from taking part in the debate. She has now left the Chamber before my hon. Friend the Member for Newport, West (Mr. Flynn) has finished his speech, contrary to normal practice.
Mr. Flynn: When that rule was changed, Beveridge said that it would never rise again from its dishonoured grave because of its futility and cruelty to the unemployed. As we have heard, seek and ye shall not find. That is precisely the theme of the Bill. Its title is meaningless in terms of its purpose. It is about a cut in unemployment benefit, and a vicious, thoroughly unjustified one. It is a breach of faith to millions of people, wrapped up and disguised in a confidence trick.
Mr. Nigel Evans (Ribble Valley): I shall make a short contribution as I know that hon. Members are extremely keen to speak. I am grateful for the opportunity to contribute to this important debate. I am proud to represent Ribble Valley, which has the lowest unemployment in Great Britain, but that does not mean that I am complacent. Just before Christmas, one of the factories in the village in which I live closed, making more than 100 people unemployed. Just before Christmas is never a good time to do such a thing, but it made the misery even more unbearable for families in the village. Although the vast majority will find jobs in 1995, some people may not. I must be extremely conscious that for each unemployed person in a constituency, irrespective of the level of unemployment, it is a personal tragedy for them and for their families.
I am also conscious of the point made by the hon. Member for Stratford-on- Avon (Mr. Howarth) about people who are getting on in years becoming unemployed; it becomes increasingly difficult for them to find work. We must direct more attention to people in their mid-50s who are looking for work. We have an aging population, and we must pay far more attention to the quality of people in their 50s who are looking for work. They still have a massive amount to contribute.
The jobseeker's allowance is a welcome simplification of the system. There was reference to the benefit reducing from 12 months to six months. The hon. Member for Rochdale (Ms Lynne) and others questioned whether Labour Members would reverse that position if they regained office. We simply could not obtain an answer from Labour Members. It is as though they are afraid to
Column 102make any commitment until just before the election, when they will pounce on the electorate and say, "This is what we are going to do." It is as though they are afraid that any of their policies could possibly be costed between now and the next general election. Opposition Members have suffered greatly in the past. We know that their figures did not add up, and I suspect that they will not add up in future. Opposition Members have decided to hide their commitments until the very last moment. They will have an opportunity toward the end of the debate to consider one of their famous U-turns and say whether they would reverse the legislation which I hope will be passed tonight.
The contract is important. It is between those who are employed and those who are unemployed, as well as many others. One side will contribute through their taxes to ensure that those who are unemployed are given opportunities to make a real contribution. It is important to have a job, just for the sake of self-worth and to give people a purpose to life and self-respect. Like most hon. Members, I believe that the vast majority of people want to work. We must give them that opportunity. We must give them a hand, not just a handout, because the latter does not give an unemployed person a more realistic chance of a job.
We have gone through a deep recession. People who survived the previous recession untouched have been hit by the next one. Businesses have gone through a particularly bad time. We have a record number of self-employed and small business people. They have made a real commitment. Many of them have their houses tied up in their businesses. If their businesses fail, they will risk losing their houses as well. Some of those people have suffered greatly. They work all the hours that God sends. They must consider how much it costs to employ people and how they will find the money to pay the wages bill at the end of the week or at the end of the month. They are our entrepreneurs. We must do as much as we possibly can to give them incentives to start and to give those who have started the opportunity to grow and to take on other unemployed people. It is our duty to ensure that those conditions exist.
It is not an easy option to start a business these days; it is a big risk. It is difficult to obtain capital in the first place. Woe betide businesses if they make a profit, because many Opposition Members think that that is wrong and that those businesses should be taxed. Making a profit is a disincentive for Opposition Members. I hope that all hon. Members give credit to small businesses and the people who work hard and make their contribution. Conservative Members talk about ensuring that we will give every business man a chance. Opposition Members and others scoff, but we must ensure that such people are given a chance.
Opposition Members cannot have it both ways. They talk about giving people the opportunity for work and, in the same breath, they talk about the minimum wage, which will make more than 1 million people unemployed. They talk about limiting the working week and about piling social costs on to employers--all with good intentions, no doubt--but I hope that people will remember that each of those on-costs has a cost itself. It is a cost like a tax; it takes away opportunities for business people to invest and it takes away the incentive for them to put in greater hours and to take greater risks.
Column 103Opposition Members rush like lemmings to sign up to anything that comes out of Europe, backing any socialist claptrap that emerges from the cauldron which boils in Brussels. They have been to the socialist mountain top and they want to jump off and to take opportunity and hope with them. We must ensure that they do not have the chance to do that. The one great difference between socialists and Conservatives is that socialists talk about caring, yet all the policies that they want to introduce fly in the face of it. We Conservatives must get on with caring. We must deliver the goods, just as we have done over the past 15 years.
I was proud to serve on the Standing Committee that considered the Deregulation and Contracting Out Bill last year. It was an excellent start. We must ensure that the deregulation initiative has another thrust this year to ensure that the on-costs on businesses are stripped away so that business is given even more opportunity to invest and grow.
Given all the initiatives about which we have talked, opportunities for employment will grow in 1995. There was a fantastic start throughout 1994, and we must ensure that it continues. It is said that two thirds of those who become unemployed find work in the next six months. We must ensure that many more do so in 1995.
The one great thing that is always hidden when monthly unemployment statistics are produced and it is said that unemployment has fallen by 43,000 or 50,000 is the massive flow of people throughout the system who have either gone into or come out of employment. The days when one went into a job at 16 and stayed there for the rest of one's natural working life have gone. There is far more flexibility within the work force. We must recognise that. There are more opportunities to take not just one career but more than one career.
I applaud the work of the employment services. Last year, I visited the employment services in Clitheroe and in Preston. They are doing tremendous work to help people into employment. The contract between those who are seeking work and the Government is right. It will ensure that those who are unemployed receive exactly the right help that they will need to go into employment as soon as possible. Like many other people, I also believe that --even if we put the question of fraud on one side--when people are simply not interested in finding work and just want to live off the state, we must clamp down as much as we can, because what those people do costs the country a great deal of money. It is also a massive disincentive and a slap in the face for all the people who get up early in the morning and go out and do a day's work--especially those who work at a job in which they have no great interest, yet who want to do that work for reasons of self- respect. We must ensure that others do not ride on their backs.
The many Government schemes already in operation to help people get back to work have already been mentioned. They exemplify what we must do. We must try to provide help for the people who need such help to get into work. With the jobseeker's allowance, people will get that help, and we shall ensure that the contract signed between the unemployed and the Government is fulfilled, so as to help everybody and to give everybody a better chance in 1996 when the proposals come into effect.
Column 1048.58 pm
Mr. Malcolm Chisholm (Edinburgh, Leith): I remember listening with incredulity when, in the 1993 Budget, the Chancellor of the Exchequer introduced the jobseeker's allowance as a measure to help the unemployed gain employment. It was a similar experience listening to the Secretary of State today. The Bill is not about helping the unemployed to gain jobs but about helping the unemployed to lose benefit, helping their partners to lose their jobs and helping the unemployed to lose the meagre rights and choices on training and employment that they already have.
The underlying economic rationale of the Bill, apart from public expenditure cuts to pay for next year's tax bribes, is to force the unemployed into ever-lower paid employment. And the Bill is shot through with the nasty social authoritarianism of the new Tory right, as typified by the two Secretaries of State who have been jostling for the lead role in introducing it.
The main mechanism to help the unemployed to lose their benefits is, of course, the six-month cut-off point; 30 per cent. of men and 57 per cent. of women will lose all right to benefit after six months because they will not qualify for the income-related allowance. The system is even worse for certain groups of people, such as the young. If a young person has a partner or is married, only 40 per cent. of the benefit that would have been paid under the old system in a year will be paid. Someone older who has received redundancy money and who has a dependent partner will receive only 30 per cent. of what would have been paid under the old system.
Things are no better for someone with a married partner. The increase in means-testing will drive many partners of unemployed people out of jobs. It will not be worth their while to work because if they do their partners will not be able to claim benefit. Again, women will probably be more adversely affected. What is more, like many people who cease to qualify for the jobseeker's allowance after six months, the people driven out of work in that way will not figure in the unemployment statistics, because there will be no reason for them to sign on.
Unemployed people are not only being cheated of unemployment benefit. It is worse than that; many of them will be denied jobseeker's allowance, too. One of the most alarming parts of the Bill appears in clauses 15 and 16, which describe how all sorts of new ways will be devised to deprive unemployed people of their legitimate benefit entitlements.
The first such concern is the length of time for which people may be denied jobseeker's allowance. Clause 15 twice mentions a period of between one and 26 weeks. We have also been told that hardship payments will be denied to many people who are disqualified, although I do not believe that that is mentioned in the Bill.
The second concern is about who will make the decisions. On the first day of this year The Observer contained an article about a leaked document from the Department of Employment suggesting that many decisions would be made by front-line Employment Service staff rather than being referred to an adjudication officer. I hope that the Minister will touch on that question in winding up. Given the number of wrong decisions now made, the proposal causes serious worry.
Column 105The third big area for concern is the increase in the number of reasons for imposing benefit penalties. The jobseeker's direction is the most notorious of those, and the aspect that has had most publicity is the idea that someone may be disqualified because of a jobseeker's direction relating to his or her appearance or behaviour. That is a good example of the social authoritarianism that I mentioned earlier.
There are many other reasons why people may be disqualified, some of which build on things that are already happening. People are already losing benefit if they refuse to go on certain courses, and that trend will be increased and intensified by the Bill. If people were being sent on real training courses it might not be so bad, but the training budget for next year is being cut by 20 per cent. and many of the courses that people will be forced to follow, on pain of losing benefit, are not genuine training courses.
The other big turn of the screw will be forcing people to take undesirable and unacceptable employment. Not many people lose benefit on the grounds of refusing employment, but the Bill explicitly states that many people will now lose benefit or incur penalties if they refuse to take a particular job. That is one of the underlying reasons behind the Bill. There are a number of undesirable jobs which people rightly do not want because of their appalling wages or conditions, but people will be forced into those jobs. As more people are driven into low-paid employment, the larger pool of people in low-paid employment will drive low wages even lower. That is the economic thinking behind the Bill.
I shall touch on other aspects of the Bill more briefly than I wanted to because other Members want to speak. One thing that has concerned me following constituency casework is the way in which people are unjustly disqualified from benefit because of alleged misconduct on leaving a job, and that will get worse following the Bill. At least a person has six months' disqualification followed by six months' unemployment benefit at the moment, but it appears in the Bill that that person will now get six months' disqualification followed by no benefit at all. There are appalling problems in the Employment Service in relation to that measure.
Recently I attended a social security appeal tribunal with one of my constituents almost one year after he had lost his job. He had had a six- month disqualification, and his appeal was at last heard 11 months after he lost his job. As happens in the majority of cases, it was discovered that he should not have had his benefit disqualified, and he got it back 11 months after losing his job. The Minister should look at that, and also at the good report from the National Association of Citizens Advice Bureaux about the matter which came out last month.
Another area to which I wish to refer is the tightening of the availability for work rules. Clause 6--I do not have the time to go into it in detail, but the matter was dealt with well by my hon. and learned Friend for Leicester, West (Mr. Janner)--suggests that the rules will become even tighter. At the moment, we are told that there is a target of 135,000 people having their benefit stopped this year for not actively seeking work.
Another constituent of mine recently had his benefit stopped, despite the fact that he was studying for only five hours a week. There is a technical rule which has been pushed through that someone who is paying more than £100 for fees--even if he is studying for only five hours
Column 106a week--will have his benefit stopped. Fortunately for my constituent, his fees were being paid through a bursary and I managed to challenge that ruling. But that is happening already, and clause 6 suggests that it will intensify. It is alarming that clause 6 states that "availability for employment" and "actively seeking employment"
"have such meaning as may be prescribed."
We can only worry and wonder about what those meanings might be. We need positive action from the Government to tackle the problems which the unemployed face. A minimum wage is a key demand, and others include a supply of appropriate jobs, high-quality training, the abolition of the 21- hour rule and reform of the earnings disregard regulations which hold a lot people out of employment. In the Bill, the higher disregard for the long- term unemployed is being abolished. We also need the preservation of the social insurance principle. The Government are running out of steam when it comes to doing anything positive for the unemployed, but, unfortunately, they are not running out of steam when it comes to attacking the unemployed and driving the wages of people lower and lower. I hope that this will be one of the last bankrupt Acts of this bankrupt Government, who cannot go too soon.
Mr. Oliver Heald (Hertfordshire, North): The hon. Member for Edinburgh, Leith (Mr. Chisholm) reflected some of the differences which we have seen all too often during past weeks in the Labour party. He said that having a jobseeker's direction on an issue such as appearance was ludicrous. I think that that was the word the hon. Gentleman used. Other Labour Members have said the same thing. Yet who was it--only few months ago--who said of the jobseeker's direction:
"If it is simply a matter of dress, deportment and drawing up a good curriculum vitae, or trying to motivate people, no one could object."--[ Official Report , 24 October 1994; Vol. 248, c. 635.]? Yes, it was the hon. Member for Glasgow, Garscadden (Mr. Dewar). So again we see that the Labour party simply cannot agree on these issues. We have heard today in The Guardian about the differences over Europe. We have heard about the differences over clause IV and on education. On employment, we have heard the same story again today.
Britain has been able to deal more effectively with unemployment than other European countries because of the regime that the Conservative Government have put in place. Speaker after speaker has criticised the measures in the Bill and assumed that they will not work. However, the evidence is that the measures that the Government have put in place are working.
When I was elected in 1992 my constituency had higher unemployment than it does now. The same is true of the constituencies of most hon. Members. I can see Members on the Opposition Benches of which exactly the same is true. In my constituency unemployment has fallen by 1,000 in the past year alone. When we consider why that is and compare ourselves with our partners in Europe, the answer is clear. We have a competitive economy. We have a spirit of entrepreneurship. We have the lowest business taxes in Europe, the lowest on-costs, one of the
Column 107lowest levels of Government borrowing, low inflation and a good quality work force who have been highly trained as a result of the activities of the Government.
We often hear from Opposition Members about structural unemployment, but Britain is the only country in Europe which is successfully tackling that problem. Twenty million people across Europe are unemployed, but in Britain, uniquely, unemployment is falling. We have one of the highest levels of labour participation.
When we deal with an issue such as jobseeking and the unemployed, we have to recognise that people have responsibilities and duties as well as rights. I mentioned the hon. Member for Garscadden a moment ago. Let us have a little wisdom from him on this subject, too. He said on 22 October 1992, two years ago:
"I'm certainly not afraid to say we should go and look at the argument that there are responsibilities and duties, as well as rights, for those who are on benefit".
I see that he agrees today that that is right.
Can we seriously argue that people have responsibilities and duties if we do nothing about it when people breach them? There must be some sanctions as well as incentives. I argue that the sanctions proposed in the Bill are the minimum required to enforce the rights and obligations that are imposed by the Bill.
First, the test of availability for work will be that people should actively seek work. That will be extended to ensure that people who take steps which deliberately undermine their prospects of finding work will be penalised. I should have thought that people who do not actively seek work should face a penalty. That is the basic contract between the taxpayer and the person involved. The person should be available for work full time for a minimum of 40 hours. If people expect to receive benefit full time, they should be prepared to work full time.
If Opposition Members criticise and say that it is wrong that people should be deprived of benefit if they are not making the effort that the Government require through jobcentres, what are they saying? They are saying that if people do not fulfil their obligations and duties, nothing should happen and people should be allowed to continue merrily without facing any sanction. That cannot be right.
Similarly with the jobseeker's direction, if the contract between the jobseeker and the Department, along with advice and guidance and the element of compulsion, does not succeed in helping the person back into work, why should there not be a direction to give that person the help and encouragement that is needed to get back into work?
Let us consider the argument that my hon. Friend the Member for Stratford- on-Avon (Mr. Howarth) employed. He described a situation in which many elderly people have been out of work for extended periods and said that one cannot force them to look for work. He is saying that, if one is elderly, one can be written off and that one need not be required to look for work. He was being ageist. Opposition Members may laugh, but older claimants should be encouraged. They should have the same opportunities and should be dealt with in the same way as any other claimant, on a level playing field.
When I recently visited my jobcentre--it is one of the new integrated centres, in which the advice and benefit services are provided in one place --it was pointed out that the centre actively encourages employers to consider
Column 108older applicants and that, if the latter do not receive the encouragement that the Government believe to be vital, we are doing neither them nor the taxpayer justice.
If the Government are prepared to make the effort through the jobcentres, elderly claimants should not say that they are not prepared to make the effort to find work because they believe that it is hopeless. It is wrong for hon. Members to argue that, unfortunately, it is impossible to find work if one is elderly. We often hear such arguments about education from Opposition Members. They say that in inner city areas the situation is hopeless, one cannot expect to achieve much and that there is no point making comparisons or publishing tables as the children will never succeed. They are using exactly the same argument for the elderly. The Government, through the encouragement that they are giving jobseekers in the Bill, are attacking some of the main issues. I confess that I am an adviser to the Federation of Recruitment and Employment Services, which deals with the private recruitment industry. Its members have frequently pointed out to me that jobseekers are concerned that they do not receive adequate encouragement to take jobs and that it is easier for them to be dependent, even though they may not receive as much benefit, than to take a job. Some of the measures in the Bill will tackle that head on. For example, the back -to-work bonus available under the scheme will encourage people to leave benefit by taking part-time work as a stepping stone to full-time work.
Mr. Roy Thomason (Bromsgrove): Does my hon. Friend agree that the package contains a range of incentives for all unemployed people to get back into employment and that it gives them a chance that the Opposition would deny? It extends the challenge and the chance to seek employment, which many people would not get under the present system. The Opposition are trying to sabotage people's efforts to gain employment. They are hurting the unemployed by resisting these measures.
Mr. Heald: I am grateful to my hon. Friend for pointing that out. Not only will the Bill simplify the benefits system, but, as he said, it will provide the unemployed with the opportunity to get back into work.
The back-to-work bonus scheme is one of the methods being used. In addition, let us not forget the employment-on-trial scheme, which will enable the claimant to take a job after three months of unemployment, without incurring any penalty if he voluntarily decides that the job is not for him within a period not exceeding four weeks. Many unemployed people facing the difficult decision to try a different area of endeavour will welcome that opportunity. Much has been made of the fact that couples and individual spouses will have no opportunities under the jobseeker's allowance. But a strength of the new system is that the period in which a partner is allowed to work will be increased to 24 hours without loss of entitlement to benefit. The Bill will therefore make a considerable contribution to getting unemployed people back to work.
My constituency suffered the difficulties of cuts in the defence industry, as did some other constituencies. In Hertfordshire, a task force approach was taken, with the county council, the TEC, the local authorities, business clubs and so on working together to try to promote employment. That approach has succeeded and, now that
Column 109the business side is right, we need employees to get back to work with proper training so that Hertfordshire can continue to succeed as it has over so many years. Since I became a Member of Parliament, unemployment in my constituency has fallen and I believe that it will fall faster as a result of this measure.
Ms Angela Eagle (Wallasey): Even the Bill's name is flawed. The switch from unemployment benefit to jobseeker's allowance is a cruel joke at a time of mass unemployment. It is Orwellian wordplay of the highest order. Unemployment benefit is compensation for being unemployed, paid for by national insurance contributions. The jobseeker's allowance is allowed to failed jobseekers who are encouraged to blame themselves for the position in which they find themselves.
Other aspects of the Bill are equally Orwellian and sinister. There is an authoritarian behavioural requirement for jobseekers, the exact details of which are not in the Bill but will be put before us in regulations at a later date. The compulsory jobseeker's agreement is a new twist in benefit sanction and is illiberal in what is meant to be a democratic state. In that respect, I associate myself almost entirely with the arguments put forward in the interesting speech of the hon. Member for Stratford-on-Avon (Mr. Howarth), who uttered many warnings to which his party should listen.
We have no information on the meaning of the "jobseeker's direction" or on what will be required of people unfortunate enough to be out of work. Will they be expected to cut their hair, lose weight or change the colour of their skin? After all, discrimination exists in the job market and we need reassurance from the Government about what people will be put through in order to keep the increasingly meagre benefits allowed by the Bill.
My objection to the Bill is that it is written and designed as if to deal with the most incorrigible recalcitrants who will never have work. Those regulations are then applied to everybody, regardless of their circumstances. The Bill assumes that unemployment benefit claimants, who are the victims of the Government's economic incompetence, are all lazy, work-shy shirkers who need to be forced into a job. The reality is very different. The vast majority of unemployed people are desperate to work and their mental health suffers on the dole. The benefits on which they live are now so low that they live on or below the poverty line. The Bill will worsen that-- [Interruption.]
Ms Eagle: Thank you, Madam Deputy Speaker. As the hon. Member for Norfolk, North (Sir R. Howell) pointed out, the Bill has a massive hole in it. The Government abdicate their responsibility to create jobs for jobseekers and make a virtue out of it. They do not recognise the duty accepted by all previous post-war Governments to maintain a stable and high level of employment. On the contrary, they reward highly paid managers of privatised utilities for destroying a massive number of jobs.
Column 110In my constituency in Merseyside, 82,410 people are currently unemployed and there are 5,186 job vacancies. That means that 16 people are chasing each job. In my constituency there are 3,882 unemployed people and 157 vacancies, which means that 25 people are chasing each job.
I object to the Bill because it blames the 24 out of 25 people in Wallasey who are unsuccessful in obtaining those jobs. It punishes them for not succeeding, but as the simple application of logic makes obvious, only one out of the 25 can succeed in filling the vacancy. A better CV, a haircut or even gleaming teeth will not help the other 24 people to succeed.
The Bill is introduced at a time when structural changes in the labour market are obvious. There is casualisation, segmentation, further deregulation and reductions in pay, all of which create instability. People move in and out of employment and are sometimes stuck in unemployment and are punished for it.
The Bill contains no analysis of the reasons for unemployment and makes no attempt to meet the needs of the unemployed. It contains very large sticks with which to beat them. That is why it is so objectionable and why we should return to a system in which the unemployed are accorded fairness, dignity and rights. They should not be treated in this authoritarian and obnoxious way by a Government who have long ceased to care for their plight.