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House of Commons

Monday 15 April 2002

The House met at half-past Two o'clock


[Mr. Speaker in the Chair]

Oral Answers to Questions


The Secretary of State was asked—


1. Lawrie Quinn (Scarborough and Whitby): What plans he has to help employees of companies affected by large-scale redundancies to find new work. [45011]

11. David Cairns (Greenock and Inverclyde): What plans he has to help people affected by large-scale redundancies to find new work. [45021]

The Minister for Work (Mr. Nicholas Brown): We have developed the rapid response service to support people affected by significant redundancies and help them make the transition to sustainable new jobs. This enhanced service allows a flexible response based on local need. I am pleased to announce that, on 1 April, the rapid response service became fully operational, supported by a further £6 million investment over two years.

Lawrie Quinn: I thank my right hon. Friend for that answer. He might recall the major threat of a factory closure in my constituency just under a year ago. Indeed, his Department helped considerably in creating a renaissance for the factory's prospects. However, many people still faced redundancy and a lot of those who came to my surgery thought that the Government should work closer with the citizens advice bureaux and local agencies that have local knowledge to help them through that difficult period when they have just been made redundant and are looking for new work. Can the Minister comment on working in conjunction with local agencies to help people to find their way back into work?

Mr. Brown: My hon. Friend makes a fair point and I am grateful for what he says about the work of officials in difficult redundancy rounds. Although it may not seem like it at the time, it is the case that those who are in work mostly go on to get further work. However, it is right that the Department is able to help. It is also right that we co-ordinate our work with other agencies. Indeed, part of the extra £6 million is intended to do exactly what my hon. Friend requests.

David Cairns: My right hon. Friend will be aware of the threat of job losses at the Coalport and Faslane bases

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on the Clyde. Although I believe that such job losses are neither inevitable nor necessary, will he confirm that if they materialise, his Department will work at once with the Scotland Office, the Scottish Executive, the management and unions to form a lower Clyde jobs taskforce along similar lines to the successful upper Clyde taskforce that followed recent redundancies and threats of redundancies in the upper Clyde last year?

Mr. Brown: First, let me sympathise with my hon. Friend. Representing a shipbuilding constituency myself, I know how difficult the threat of major redundancy rounds can be to communities that rely on a single large employer. I pledge that the Department will work with others to do what we can to help in the event of a redundancy round, although I understand that work is being done within the industry on the viability of the business, so we are not in that situation yet. The Department is in touch with others who have an interest in the event of a major redundancy round, including the agencies of the Scottish Parliament and of local government. If the help is needed, it will be there.

Annabelle Ewing (Perth): The Scottish National party shares the anxieties about the potential job losses at Faslane and Coalport. The Minister referred to significant redundancies. Presumably he accepts that redundancies on a numerically smaller scale may none the less have a greater marginal impact on small communities. Does he also accept that the real issue concerning jobs in Scotland and elsewhere in the United Kingdom will not be solved until the Government start to address the underlying structural problems that face business in the UK, including their high-pound policy and the infliction of the highest fuel taxes in the industrialised world?

Mr. Brown: May I say gently to the hon. Lady that more people are in employment in our country than ever before? If it is the policy of the Scottish National party to oppose defence expenditure, how does she hope to preserve defence jobs?

Rachel Squire (Dunfermline, West): Does my right hon. Friend share my deep regret at the recent closure of Scotland's only deep coal mine and the loss of 500 jobs? Will he join me in welcoming the rapid partnership that developed between the Employment Service, Scottish Enterprise Fife, Fife council, the Department of Trade and Industry, the Scottish Executive, the mining unions and many others to give those men every possible assistance in training and job opportunities? Does he agree that those miners have many skills and special qualities and that their needs should continue to be prioritised by the Government and the partnership in the weeks ahead?

Mr. Brown: As I told my hon. Friend the Member for Greenock and Inverclyde (David Cairns), I understand how difficult these major redundancy rounds are. Shipbuilding and coal mining communities rely on a single, focused employment base, and when that is jeopardised the situation for the local community becomes very difficult. I can confirm that the Department's officials are working very closely with agencies of the Scottish Parliament and with Fife council to do everything that we can to help people who are displaced into other employment opportunities. We know that the

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opportunities are there, and my hon. Friend is right to draw attention to the experience and skill base in the industry.

Mr. Dennis Skinner (Bolsover): I associate myself with the remarks made by my hon. Friend the Member for Dunfermline, West (Rachel Squire) on Scottish mining jobs. Will the Minister take into account the fact that most large-scale redundancies come out of the blue, and the Government have to react to them?

May I also tell my right hon. Friend that when colleges go into a review—this is not his Department, but he should listen carefully—it means that the Government may indirectly cause large-scale redundancies? There is one such college in my constituency, North Derbyshire tertiary college, and I hope that it is imprinted on the mind of every Minister. Instead of closing it down and causing large-scale redundancies, the Government should save it.

Mr. Brown: I always listen particularly carefully when a matter being put to me is not my responsibility, in case I inadvertently give a commitment that I should not. The fairest thing that I can say to my hon. Friend is that I will draw his remarks to the attention of the appropriate Minister. He has made his point, and he is right to say what he does about redundancy rounds, whether they occur in education or in traditional heavy industry.

New Deal

4. Huw Irranca-Davies (Ogmore): What assessment his Department has made of the effect the new deal has had on youth unemployment. [45014]

6. Mr. Graham Brady (Altrincham and Sale, West): If he will make a statement on his proposals to reform the new deal for the young unemployed. [45016]

The Minister for Work (Mr. Nicholas Brown): Since 1997, youth unemployment has fallen by 43 per cent. and long-term youth unemployment has been reduced by more than three-quarters. The new deal for young people has played an important part in that, helping more than 350,000 young people off benefit and into jobs, and improving the work prospects of many more.

We are building on the success of the new deal and are well advanced in making the improvements to the programme which we announced in last year's Green Paper, "Towards Full Employment". In the last three months, we have launched "progress2work" pathfinders, which provide help for unemployed drug misusers, and announced tailored pathway pilots to give personal advisers more flexibility to combine new deal options to suit the needs of the individual client. This month we are introducing StepUp pilots, which will provide transitional employment opportunities, and outreach initiatives to provide more effective support for people from ethnic minority communities.

Huw Irranca-Davies: I thank my right hon. Friend for that answer. The new deal programme and associated Government measures are undoubtedly turning round the despoliation of many years of Tory rule in Wales.

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However, will he expand on the new deal's effect on the local and national economy because, surely, great savings are made if youngsters are in work?

Mr. Brown: I am grateful to my hon. Friend for his remarks, and I welcome him to Question Time—we hope to see him here again.

Every study on the new deal has confirmed that it adds substantially to the national economy. One way of looking at it is to consider that for every £5 that the Government spend, we get £3 back, either in social security expenditure that is no longer undertaken or in tax revenues.

Mr. Brady: Why do Wildcat and other schemes in the United States achieve far higher success rates than the new deal for young people at a fraction of its £8,000 per job cost?

Mr. Brown: The Conservative game has already been given away by the party's health spokesman. First, the Conservatives pretend that the Government's programmes are not working and that they can never work, and then they say that the provision should not be made at all or that it should be funded by insurance or by people's own resources. They then try to wrap that up—this is apparently the most difficult part—into a message that they can sell to the electorate. The electorate will say, "Under the Conservatives there were a third of a million young people out of work, and under Labour the figure is below 4,000."

Vernon Coaker (Gedling): The new deal has been a tremendous success in tackling youth unemployment, and we should strongly congratulate the Government on that. In my constituency, many young people who previously languished on the dole are now in work. Many of the young people who are still unemployed have associated problems, such as physical disabilities, learning difficulties, drug abuse problems or, indeed, literacy and numeracy problems. In any development of the new deal, will my right hon. Friend ensure that advisers are supported with a package of measures to help such young people back into work?

Mr. Brown: We have two new pilot schemes. One is to look at greater flexibility, and the other of course is the StepUp pilot. They are designed to help those who have been through the new deal but not found work so far. This is a radical programme, and there are 20 pilots. The Government are, effectively, purchasing the job for the individual for a year. We are absolutely determined that nobody is left out or bypassed by the schemes. Everyone who can work should have the right to work, and the Government should help them do so.

Mr. James Clappison (Hertsmere): The Minister is not exactly being reckless in predicting that the hon. Member for Ogmore (Huw Irranca-Davies) will be in the House in future, but is he not being a little cavalier with the facts? Was not the National Audit Office right when it said that, to evaluate the new deal, it is necessary to take into account those who would have found jobs anyway? When that is done, did the NAO not find that the reduction in youth unemployment brought about by the new deal is not 350,000, as the Minister has just claimed, but 35,000,

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and that the cost per job under the new deal is far greater than the Government have maintained? In fact, is the new deal not one more example of this Government taking and spending a great deal of taxpayers' money and not making much difference in return?

Mr. Brown: The hon. Gentleman rather confirms the accuracy of the answer that I gave the hon. Member for Altrincham and Sale, West (Mr. Brady). We can see what the Conservatives are about. The hon. Gentleman selectively quoted the National Audit Office report. Neither that report nor any other has said that the new deal is not value for money. There will always be an element of dead weight cost in these schemes. One might just as well argue that teaching children to read has a dead weight cost because some of them would learn to read anyway. That is a ridiculous argument. We are talking not about a job-creation project but employment schemes. They are serving our country, and in particular disadvantaged people. They are serving them well and are value for money too.

Mr. Peter Pike (Burnley): The Minister knows that Burnley will have one of the StepUp programme pilots. What steps will be taken in that significant programme, which will be important to those who have not been able to gain employment, to publicise, particularly in the local and regional press, exactly what is being done?

Mr. Brown: I am grateful to my hon. Friend for his question and for the close interest that he has taken in the pilot scheme. It will—I hope—have an important impact on his constituency. It is the Government's intention to publicise the programme. Indeed, we intend formally to launch the pilots in the next few weeks. I will make sure that proper publicity is given locally, and I shall draw his remarks to the attention of those who are managing the scheme locally. It is a very significant new scheme. For the first time, the Government are saying that we guarantee a job for a year to someone who has found the labour market intractable so far. I think that that should be welcomed.

Mr. Brady: On a point of order, Mr. Speaker. May I give notice that I wish to raise the matter on the Adjournment following the Minister's woeful failure to answer on the fact that schemes elsewhere in the world perform better?

Mr. Speaker: The hon. Gentleman has given notice.

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