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House of Commons

Tuesday 7 March 1995

The House met at half-past Two o'clock


[ Madam Speaker-- in the Chair ]

Oral Answers to Questions


Long-term Unemployed

1. Mr. Streeter: To ask the Secretary of State for Employment what assessment he has made of how the long-term unemployed are affected by Government policies.

The Secretary of State for Employment (Mr. Michael Portillo): The Government have developed a range of measures to help the long-term unemployed back into work. The proportion of those who are long-term unemployed is markedly lower in Britain than the EC average.

Mr. Streeter: In view of the rapid fall in unemployment, is it not the case that the prospects of the long-term unemployed obtaining work are now better than they have been for many years? Does my right hon. Friend agree that to introduce now the job destruction programme of the social chapter and a national minimum wage would be for those who are genuinely seeking work nothing but a massive kick in the teeth?

Mr. Portillo: The aspiration of those who developed the social chapter was to create a social dimension to the European Community. It was a massive raft of legislation under qualified majority voting which would have loaded costs on employers and destroyed jobs. I make it clear to my hon. Friend that there will be no end to the opt-out negotiated by this Government. The Labour party would sell out anything at all in its craven attitude to Brussels.

Mr. Soley: Is it the intention of the Secretary of State to achieve full employment?

Mr. Portillo: It is my intention that the maximum number of people should be able to participate in work. That means developing a flexible labour market and it means helping people with practical measures from Government. It means establishing policies that enable the country and the economy to grow. It means establishing policies to encourage people to invest in this country and to create job opportunities. It means avoiding the Labour party's technique of trying to mislead the unemployed into believing that a Government can spend their way out of unemployment.

Mr. Merchant: Does my right hon. Friend agree that a minimum wage is one of the greatest threats to measures to curb and to overcome long-term unemployment? Does

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he agree that a minimum wage would not just get in the way of job creation, but would result in the loss of many valuable jobs that exist today?

Mr. Portillo: Yes, it is a complete fallacy to believe that a minimum wage has anything to do with the reduction of poverty. Many people who work on low wages are second or third earners in their households. Those are the sort of jobs that could easily be destroyed by the introduction of a minimum wage, with the result that families who enjoyed the benefit of extra incomes would be made poorer. As the trade unions insist on the maintenance of differentials, the bulk of the resources that would go into establishing a minimum wage would benefit people who were better off and not the people at the bottom.

Mr. Chidgey: Is the Secretary of State aware that outcomes show that training for work policies are failing the long-term unemployed, with only one in 10 gaining full-time employment after leaving such schemes? Does he accept that instead of slashing training budgets by more than £125 million, the money should be redirected and targeted at long-term unemployment which remains an unacceptably and disproportionately high part of the unemployment total?

Mr. Portillo: The training for work budget is targeted at the long- term unemployed, who are precisely the people who can qualify for training for work. The hon. Gentleman is on to quite a good point in saying that not enough people are getting jobs or other what we call positive outcomes at the end of their training--in other words, going into other opportunities that are valuable to them. I am determined that that proportion shall rise and I shall get the proportion of those who achieve a positive outcome from their training of one sort or another up to 50 per cent. I believe that the hon. Gentleman will welcome that development.

Mr. Couchman: How many of the long-term unemployed owe their predicament to employment consultancies that give advice on how to sack people, such as the JSB Group which is headed by the hon. and learned Member for Leicester, West (Mr. Janner), the Chairman of the Select Committee on Employment?

Mr. Portillo: I am not able to give the figure. Every hon. Member is the guardian of his own conscience and, certainly, people should be in the business of removing any beams from their own eyes before they search for motes elsewhere.

Mr. Barron: If one half of the long-term unemployed on training for work courses are not getting any qualifications at all and more than half the men who come off those schemes go back on the dole, as do a third of women, how can the Government justify cutting the training budget by 20 per cent. and slashing 55,000 chances for the long-term unemployed to go on to a scheme?

Mr. Portillo: Although the hon. Gentleman asked the question in all innocence, he knows perfectly well that the objective of our training for work reforms is precisely to ensure that the training is not only for training's sake, but to get people into jobs and into other opportunities of value. I shall increase the proportion of people who get

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those positive outcomes. I shall increase the numbers of people who get those positive outcomes. If the hon. Gentleman is attacking that, let him stand up and say so.

Ms Short: By magic?

Mr. Portillo: The hon. Lady says that because she has no understanding of improving efficiency or value for money. That, if I may say so, is what distinguishes the Labour party from the Conservative party.

Departmental Employees

2. Mr. Harry Greenway: To ask the Secretary of State for Employment how many people are in (a) his Department and (b) the Employment Service agency; what the figures were two years ago; and if he will make a statement.

The Minister of State, Department of Employment (Miss Ann Widdecombe): There are 55,693 staff in the Employment Department group, of whom 44,737 work in the Employment Service agency. Two years ago, there were 61,897 staff in the Department, of whom 47,652 worked in the Employment Service agency.

Mr. Greenway: On International Women's Day, would my hon. Friend join me in welcoming an end to discrimination against women in employment? May I also be assured that there will be no discrimination against men in employment? From the figure that she has kindly supplied, is it not clear that lower unemployment means that fewer staff are needed by her Department and that everyone saves because those people go to other jobs?

Miss Widdecombe: Fewer staff are needed because, of course, there has been a fall in unemployment, which should be welcomed by all parties. I can confirm what my hon. Friend says. We welcome moves which reduce discrimination against women and we are committed to eliminating discrimination against women, but, of course, that should not involve, in turn, discriminating against men.

Rev. Martin Smyth: Does the Minister agree that the greatest discrimination is against people with disabilities? Will she tell us, therefore, how many disabled people are employed in the Department and in the Employment Service agency?

Miss Widdecombe: The number of registered disabled people in the Department of Employment at 1 July 1994 amounted to 2 per cent.

Coal Mining Areas

3. Mr. Illsley: To ask the Secretary of State for Employment what steps he intends to take to improve employment prospects in former coal mining areas.

The Parliamentary Under-Secretary of State for Employment (Mr. James Paice): As a result of the Government's sound economic policies and a flexible deregulated labour market, as well as the £200 million special measures package, unemployment is falling in Barnsley and most other former mining areas as it is in the rest of the country.

Mr. Illsley: Is the Minister aware that a recent survey carried out in former mining areas, as he refers to them, particularly in Barnsley, showed that 44 per cent. of

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miners who were made redundant in 1992 were still unemployed, that 9 per cent. were in training and that, overall, something like 89 per cent. of those miners were worse off, especially those who had taken jobs which paid around £65 a week less than they previously earned in the mining industry? That is a consequence of this Government's policy towards the coal mining industry and towards employment. Those 44 per cent. of people and 30 per cent. of males who are economically inactive in former coal mining areas are the positive outcomes of Government policy. Those are the positive outcomes of the Department of Employment. What will the Government do to restore employment in those areas?

Mr. Paice: Any change in the economic structure of any locality obviously creates disruption. As has happened in so many parts of the country over many centuries, it takes time for local communities to adapt to new circumstances. If the hon. Gentleman is referring to the survey and work done by Sheffield Hallam university on the subject-- Mr. Illsley indicated dissent .

Mr. Paice: In that case, the answer to his question is no, I do not know anything about the study to which he has just referred. If he would draw it to my attention, I am sure that I would discover that it is based on just as much flawed information as the survey carried out at Sheffield Hallam university.

Mr. Devlin: Has my hon. Friend seen the answer to a parliamentary question that I tabled last week, which shows that in five years the previous Labour Government closed three times as many pits in the northern region as the Conservatives have closed since 1979? In the light of that, is it not a bit rich of Opposition Members to make a great fuss about this Government's record on the coal mines when the Labour party's record is far worse?

Mr. Paice: The House is no stranger to the hypocrisy that we often hear from the Opposition Benches. As my hon. Friend reminds us, we are well aware that previous Labour Governments closed 313 pits in total and lost 205,000 jobs--far more than have been lost in recent years. British Coal now has a new future in the private sector. Pits are being reopened and people can look forward to greater job security.

Mr. McCartney: Those of us who live in mining communities need no lessons from Conservative Members. Between September 1992 and December 1994, 34,000 miners lost their jobs as a result of the actions of this Government. That amounted to 83 per cent. of British Coal's work force. Labour local authorities have joined British Coal Enterprise Ltd. to try to regain the ground lost as a result of the huge job losses. However, even now the Government are trying to close British Coal Enterprise. What will the Minister do to protect the continuation of British Coal Enterprise and its activities in mining communities? The closure of British Coal Enterprise will see the loss of 400 more jobs while thousands of miners are still on the dole.

Mr. Paice: The hon. Gentleman forgot to mention the pits that have been reopened since they went into the private sector. He knows as well as I do that the funding of British Coal Enterprise is guaranteed until March 1996 and that its future beyond that is a matter for my right

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hon. Friend the President of the Board of Trade, who is obviously extremely concerned that the good works of British Coal Enterprise are not lost.

Labour Statistics

4. Mr. David Martin: To ask the Secretary of State for Employment if he will list those major countries in the European Union where the level of unemployment is on a clear downward trend.

The Parliamentary Under-Secretary of State for Employment (Mr. Phillip Oppenheim): The United Kingdom is the only major EC countrywhere unemployment has continuously fallen over the last six months, using the internationally recognised and comparable International Labour Organisation figures.

Mr. Martin: Can my hon. Friend confirm that, despite the Labour party's constant bleating about fiddling the figures,

unemployment--including youth unemployment--is falling in this country as a result of policies that recognise that businesses best create jobs as a result of low rates and low taxation and without Labour encouraging envy and over-regulation?

Mr. Oppenheim: Perhaps uncharacteristically, I am on the side of the Trades Union Congress on this one. The figures that I have quoted are the international standard ILO figures, which the TUC said were wholly reliable. Those figures show that unemployment in the UK is falling faster than in the rest of Europe and that employment in the UK is rising faster than in the rest of Europe. The ILO figures, which the TUC supports, show that the unemployment total in Britain is 2.4 million, which is almost exactly the same level as the claimant count which the Opposition say is fiddled. How can they both show the same totals when one is apparently fiddled, but the other is not?

Mr. Hardy: Would the Minister care to tell the House of any areas in Europe where the problem of unemployment is more intense than it is in areas like the Dearne valley and certain other coalfield counties? Whatever the Government may say about the statistics, can the Minister provide evidence that our position is better than that of anywhere else?

Mr. Oppenheim: I suggest that the hon. Gentleman considers several countries within the European Community, not least Spain where youth unemployment is three times the UK level and overall unemployment is twice the UK level. It is no coincidence that Spain has a Socialist Government and one of the most regulated economies in Europe. As a result of that regulation, whereas Britain has only 5 per cent. casual workers, Spain has 33 per cent. casual workers because employers there cannot afford to employ people within the regulated system. Is that what the hon. Gentleman wants for Britain?

Flexible Labour Market

5. Miss Emma Nicholson: To ask the Secretary of State for Employment what impact the Government's flexible labour market policy has had on the ability of the Employment Service to place people into jobs over the last year.

Miss Widdecombe: Progress in achieving a flexible labour market means that a diverse range of job

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opportunities is increasingly available. That is good news for unemployed people, who are more easily assisted into finding work by the Employment Service, which placed 1.8 million people into jobs last year, an increase of 16 per cent. over the previous year.

Miss Nicholson: Does my hon. Friend agree that considerably more people are in employment in the United Kingdom than in other member nations of the European Union? If she agrees with that point, does she believe that our more flexible regulations contribute massively to that excellent result?

Miss Widdecombe: I can indeed confirm that we have a higher participation rate than other major EU countries and that our excellent employment position is owing to our flexible

policies--policies which have caused unemployment to fall steadily for two years, which give us among the highest take-home rates of pay and lower than average youth unemployment, which created 220,000 full-time and 83,000 part-time jobs last year, and which put nearly 2 million people into work. We have the second highest percentage of female participation and among the highest number of part-time jobs.

Ms Short: Is the Minister aware that fewer hours are now worked in the British economy than were worked in 1979, that women in Britain have a bigger gender pay gap than women in any other European Union country, and that the percentage of men in employment, which was 93 per cent. in 1971, is now 75 per cent? Does she agree that the Government's version of flexibility means insecure, low-paid employment for increasing numbers of British families?

Hon. Members: Over-rehearsed.

Miss Widdecombe: Not only over-rehearsed, but largely inaccurate. As for the pay gap, perhaps the hon. Lady would like to welcome the fact that the gap between women's and men's pay is now narrower than ever. It is decidedly narrower than it was when the hon. Lady's party was in power. Perhaps, when the hon. Lady deplores levels of work, she will welcome, as my hon. Friend the Under-Secretary said, our high participation rates compared with those of our European neighbours. As the hon. Lady is talking about women, will she welcome the fact that this is the only country with a lower female than male unemployment rate?

Industrial Relations

6. Sir David Knox: To ask the Secretary of State for Employment if he will meet the Confederation of British Industry to discuss the long-term improvement of industrial relations.

Mr. Portillo: I have no current plans for such a meeting, but that is no reason for us to neglect the fact that the number of days lost in strikes last year was the lowest since records began in 189l.

Sir David Knox: Although there has been a great improvement in industrial relations in recent years, does my right hon. Friend agree that, in that sphere as in all others, there is no room for complacency? Does he agree further that employee participation plays an important part

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in the consolidation of that improvement in industrial relations? Will my right hon. Friend discuss that point when he next meets the Confederation of British Industry?

Mr. Portillo: That might be a good subject for discussion with the CBI. I agree with my hon. Friend that consultation with employees is a hallmark of good employers. The important point is that that should be a matter for employers and employees; it should not be imposed upon them either by Governments or by Brussels. It is extraordinary to see Labour Members wishing to sign up to things like the works councils directive, which would impose a wholly inflexible, wholly rigid superstructure on companies, and thus make them less able to respond to the marketplace. I do not believe that my hon. Friend would want anything like that.

Mr. Pike: Does the Secretary of State recognise that there is considerable concern among the work forces of privatised utilities, who see their job opportunities slashed by managements who give themselves massive pay awards? Is that not criminal? Should not the Government take action to stop it now?

Mr. Portillo: I have noticed that customers of the former nationalised industries used to worry day to day and year to year about their security of supply, but that is no longer the case. Whereas in the past, people were afraid that there would be strikes in the gas or electricity industries, on the airlines or in the coach companies--all the important services that were provided to the public--they no longer fear such strikes, because privatisation has improved industrial relations in those essential services. We shall continue that policy in some of the other essential services. Doubtless, by that means, we shall restore industrial peace in those sectors, too.

Mr. Anthony Coombs: Does my right hon. Friend agree that the reason why there are only 1 per cent. as many strikes now as there were in 1979 is that people on both sides of industry realise that the only beneficiaries from strikes are our foreign competitors? In the increasing climate of co- operation rather than confrontation, is it not appropriate to say that works councils imposed upon industry either by Brussels or, potentially, by the Labour party are a total and absolute irrelevance and a waste of time?

Mr. Portillo: It is worth dwelling for a moment on the figure given by my hon. Friend that there are 100 times fewer strikes now than there were in 1979. In January 1979, there were 10 times as many days lost to strikes as in the whole of 1994. The Labour party had a miserable record.

I do not know whether my hon. Friend was right to say that that is now accepted by both sides of industry. Bill Morris recently said that he wished to repeal a dozen pieces of Tory legislation on industrial relations.

Mrs. Helen Jackson indicated assent .

Mr. Portillo: There have been only a dozen pieces of legislation. I see the hon. Member for Sheffield, Hillsborough (Mrs. Jackson) nodding. Perhaps she could

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tell us whether the Labour party's policy is to repeal all of the pieces of legislation which have brought peace to British industry.

Ms Harman: Does the Secretary of State think that it will improve industrial relations-- [Interruption.]

Madam Speaker: Order. The House must calm down. Members on both sides are much to noisy.

Ms Harman: Does the Secretary of State think that it will improve industrial relations at British Gas that its chairman Cedric Brown has had a pay increase which takes his pay up to £475,000? Does the Secretary of State agree with the Prime Minister that such increases are distasteful and that legislative action may be necessary to prevent them, or does the right hon. Gentleman stand by what he said only last week, that there should be no Government intervention in those matters?

Mr. Portillo: The hon. Lady ought to quote the Prime Minister accurately, as she ought to quote me accurately. That is the courtesy that she owes to every Member of the House. If the hon. Lady can make her case only by misquoting people, we must draw the conclusion that she does not have a case at all.

Let me tell the hon. Lady about British Gas. When British Gas was nationalised, the Opposition told us not to privatise it. We were told that the service was as good as it could be, and that prices were as low as they could be. Since then, the service has been improved, the number of customers has increased and prices have been slashed in real terms. The company has improved its efficiency so much that it is able to make profits.

The hon. Lady--who has been wrong year after year and whose every premise has been proved wrong--now complains that people who knew better than she and who could manage better than she are being rewarded. She wants to unleash the politics of envy, but I tell her that those politics will gobble up her and her party.

Young People

7. Mr. Nigel Evans: To ask the Secretary of State for Employment how many young people in the United Kingdom have either education or training places; and what were the figures in 1979.

Mr. Paice: The answer is 1.1 million in spring 1994. This is 84 per cent. of all 16 and 17-year-olds, which compares with 54 per cent. in 1984, the first year for which information is available.

Mr. Evans: Opposition Members have a sad obsession with job- destroying policies such as the social chapter, the minimum wage and adding social costs on to employers. Are not the policies which we have adopted-- including training and education, the national curriculum, general national vocational qualifications, national vocational qualifications, youth credits, the modern apprenticeship scheme, the accelerated apprenticeship scheme and the schemes adopted by training and enterprise councils--far better? Are not those policies the best way of giving hope and opportunity to our young people for the future?

Mr. Paice: My hon. Friend is right. The Government have put in place a range of measures so that all our young people--whatever their background or ability--can choose the best way to maximise their talents and to drive

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forward Britain's economic recovery and skills for the future. Nearly all of the changes have been opposed by the Labour party, which has begrudgingly come round to accept them, because it knows that what we are doing is right in the long term for our country.

Mr. Barry Jones: How many apprenticeships exist today in Britain?

Mr. Paice: Apprenticeships at present are a matter for individual industries. There is no national apprenticeship scheme for which records could be kept. The modern apprenticeships scheme that the Government are launching is presently in prototype form and, as the hon. Gentleman knows, there are 18 prototypes up and running. This autumn there will be another 40. By the time that the programme is complete, there will be 70,000 skilled people coming out of modern apprenticeships each year.

Mr. Jones: On a point of order, Madam Speaker.

Mr. Evennett: Does my hon. Friend agree--

Mr. Jones: On a point of order, Madam Speaker.

Madam Speaker: Order. The hon. Member for Alyn and Deeside (Mr. Jones) cannot raise a point of order; it was not his substantive question.

Mr. Evennett rose -- [Interruption.]

Madam Speaker: Order. Let us have a little quiet so that we can hear the hon. Gentleman who is on his feet--Mr. Evennett

Mr. Evennett: Does my hon. Friend agree that the many sixth formers staying on after the age of 16 and the many young people in training constitute a real achievement and a real success story? Does he further agree that that lays the foundation for successful training to be built on by those young people in the future, so that we shall have a well-trained and skilled work force?

Mr. Paice: Yes, my hon. Friend is right; 73 per cent. of 16-year- olds are now in full-time education, compared with only 48 per cent. 10 years ago. That is a tremendous achievement, and must bode well for the future.

Twenty-one-hour Rule

8. Mr. Chisholm: To ask the Secretary of State for Employment what guidance has been given by his Department in relation to the current operation of the 21-hour rule.

Miss Widdecombe: The Employment Service issued guidance to staff in January 1995 on the rule that allows people to study part time while claiming unemployment benefits. The guidance also referred to the 21-hour rule, which is a separate rule in income support. Recent changes in the way that education courses are organised have made those rules increasingly difficult to administer. The purpose of the guidance was to reduce the inconsistency that was arising in practice.

Mr. Chisholm: So why are the Government adopting such a perverse approach towards reskilling the unemployed, first by issuing new regulations by the month to make it more difficult for unemployed people to take up part-time education and training courses, and then

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by announcing that only 16 hours of guided learning will be allowed under the rules for the jobseeker's allowance? Is that because the Government believe the surreal logic of their own arguments, or because they have not a clue how to run a modern economy, where skills are the key to success?

Miss Widdecombe: I find it difficult to believe that the hon. Gentleman can seriously be as ignorant of the new proposals as his question suggests. There is no reduction. At present, the 21-hour rule covers both guided learning hours and private study; in future we shall rely on a limit of 16 guided learning hours a week, with as much private study as is compatible with being available for work. There is no reduction--the same number of students will be able to study--and there is no reduction in the cost to us. The hon. Gentleman really should do more homework before asking such questions.

Mr. Rowe: Does my hon. Friend agree that the profitable use of time while people are unemployed, especially if that directs them towards achieving the confidence that will enable them to get back to work, is most important? In that light, will she reconsider the very limited amount of notice that volunteers on unemployment benefit are allowed to give to the organisations that use them?

Miss Widdecombe: Volunteers can of course already exercise a delay before taking up a job, which unemployed people in general are not allowed to do. So we have already recognised that problem. However, my hon. Friend is right to say that constructive use of time while people are unemployed is important, especially in helping them to acquire skills and experience that can then be used in the labour market. For precisely that reason, we not only encourage volunteering but have made certain that our study rules have been carried through into the jobseeker's allowance so that people can study part time while on benefit. That seems to me an excellent balance to strike.

Mr. Simpson: What advice or explanation would the Minister offer to unemployed people undertaking part-time learning within the rules but who find that their benefits are cut because their fees exceed £100?

Miss Widdecombe: It is not the purpose of the benefits system to resource the education system, but a balance must be struck for people who are involved in modest, part-time study that does not impinge on their active job search. If such people could be on full-time or long and expensive courses, that is where they should be, rather than on benefit.

National Minimum Wage

9. Mr. Duncan Smith: To ask the Secretary of State for Employment if he will make an assessment of the effects of a national minimum wage on the employment prospects of young people

Mr. Oppenheim: In Belgium and France, which both have a national minimum wage set at a significant level, youth unemployment is, respectively, one and a half times and twice as high as youth unemployment in the United Kingdom. I will make an estimate of the effects of a national minimum wage in the United Kingdom when the

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Opposition decide the level at which it would be set and what they would do about differentials. I notice that they are laughing at that.

Mr. Duncan Smith: Does my hon. Friend agree that it is easy to talk about a minimum wage but more difficult to set the level? Does he recall that when President Clinton came to power in the United States he said that he would increase the rate from $4.25 to $4.75 but has failed to do so because he recognises how damaging that would be? Does he further agree that just talking about the minimum wage without setting the level is sheer tokenism and that the Opposition would do well to understand that?

Mr. Oppenheim: I entirely agree with my hon. Friend. It is interesting that the hon. Member for Peckham (Ms Harman) tittered loudly when my hon. Friend said that Labour had not set a level for the minimum wage. It is also interesting that the Labour leader last week scuttled off to the TUC to say that Labour would not set a level until after the next election. Labour is telling the low-paid that it will wave a magic wand and, at no cost, will increase their standard of living, but it is not prepared to be honest enough to reveal the cost in terms of lost jobs. That is the low level of opportunism and cynicism to which Labour policy has now sunk.

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