Select Committee on Education and Employment Fifth Report


New Deal for Young People and other New Deal programmes

4. There are six main programmes under New Deal which differ in a number of ways. NDYP was the first to be launched and remains the most substantially funded part of New Deal. Initial projections indicated that NDYP would involve at any one time some 250,000 young people between the ages of 18 and 24 and that it would cost up to £3.1 billion per annum. The programme was designed for those who had been claiming Jobseeker's Allowance (JSA) for six months or more although in some cases, such as for those who have multiple disadvantages, early entry into the programme is possible. Participation is mandatory for all 18-24 year olds who are unemployed and have been claiming JSA for six months.

5. On joining the NDYP, participants enter the Gateway, a period which lasts for up to four months. At the outset of the Gateway, each participant is assigned a personal adviser who provides assistance with job search, careers advice and guidance and preparation for and submission to one of a range of options. Sixty per cent of those entering NDYP find employment before they reach the end of the Gateway.[4]

6. At the end of the Gateway, participants who have not found employment enter one of four 'options':

  • the Employment Option which provides a subsidised, waged job with an employer;
  • the Environmental Task Force Option (ETF) which provides a job with a wage or, more often, a 'benefits plus' package;[5]
  • the Voluntary Sector Option which provides work with a voluntary sector organisation on either a 'benefits plus' or wage basis;
  • the Full-time Education and Training Option (FTET). This option may last for up to a year. Participants are paid an allowance equivalent to their benefits and have some access to expenses for exceptional costs.

7. There is no 'fifth option' of remaining on the unemployment register. If a participant declines or fails to take up a place on an option or leaves an option early without good reason, then a benefit sanction of two weeks loss of benefit (increasing to four weeks and then six months for subsequent violations) may be applied. It is only when participants have been sanctioned for the third time that they lose their benefits for just six months.[6]

8. The follow-through strategy is designed to help participants to make progress towards finding and remaining in employment, and it provides them with further assistance if they return to the unemployment register either if they leave an option early or at the end of an option.

9. New Deal for the Long-term Unemployed (NDLTU) is targeted at those aged 25 or over who have been unemployed for two years or more (although in some pilot areas different approaches have been tested, reducing the period of unemployment prior to entry into the programme to either 12 or 18 months). Personal advisers provide support and advice and there are two main options—either subsidised employment or education and training. Participation is not compulsory and in some areas NDLTU has operated alongside other labour market schemes such as Work-based Learning for Adults. From 1 April 2001, the minimum period of unemployment needed prior to entry to NDLTU will be reduced to 18 months nationwide.

10. Participation in New Deal for Lone Parents (NDLP) is voluntary. It is aimed primarily at single mothers who have been claiming income support for six months or more and whose youngest child is over five years and three months old. Participants are assigned a personal adviser who can, after an initial interview, provide assistance with job search and in-work support. In the March 2001 budget, the Chancellor of the Exchequer announced an expansion of NDLP which would include wider use of compulsory work-focussed interviews and the introduction of a new advisory and outreach service.[7]

11. New Deal for Partners of Unemployed People (NDPU) is aimed at those whose partners are unemployed job seekers. Participation is voluntary. Those aged between 18 and 24 years old without children can join NDYP on a voluntary basis. For older participants, or those with children, there is access to a range of advice and information through a personal adviser. NDPU will be replaced by New Deal for Partners later this year.

12. The New Deal for Disabled People (NDDP) provides access to advice and guidance through a personal adviser. The programme is also intended to raise awareness among employers and service providers of the employment needs of disabled people. Participation is voluntary.

13. New Deal for People Aged 50 and Above (ND50+), another voluntary programme, is aimed at those over the age of 50 who have been claiming incapacity benefit, income support or JSA for at least six months. As in the other elements of New Deal, there is access to a personal adviser who can provide advice and guidance. Those finding employment through the programme can receive an employment credit for up to a year.

4  Q. 22. Back

5  Those participating in the ETF or the Voluntary Sector Option on a benefits plus basis receive the benefits to which they would have been entitled had they remained on the job seekers register plus an additional allowance of £15.38 per week. Back

6  Department of Education and Employment press release, 22.06.99. Back

7  HM Treasury, Budget 2001: Investing for the Long Term: Building Opportunity and Prosperity for All, March 2001, paras 4.11-16. Back

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