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18 Nov 2002 : Column 370—continued

Mr. Brazier (Canterbury): Pilots.

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Mr. Smith: Surely it was sensible to pilot a groundbreaking initiative. That should be welcomed by the Opposition as it will be welcomed by many disabled people and their representative organisations throughout the country. More sensitive help and new rehabilitation are being brought forward, with new partnerships working with occupational health specialists and the national health service. New financial incentives are involved. I would have thought that #40 a week for a year for someone moving off incapacity benefit into work would be welcomed by Opposition Members.

The hon. Member for Havant (Mr. Willetts) referred to the existing new deals. We learned from them and from those who have been successfully providing the new deal for disabled people, as well as from the experience of where it has been less successful. We are considering how we can incorporate the lessons of the best practice and the good providers. The hon. Gentleman asks how many people would be affected. Depending on the pilot areas that are selected, I anticipate that it will be about 8 per cent. of the flow on to incapacity benefit in the first instance.

As I said, the benefits uprating statement is good, and includes a good proposal to help deal with the longstanding increase in those who move on to incapacity benefit by encouraging them to consider their options, and offering them new hope and help into jobs.

Mr. Frank Field (Birkenhead): I welcome the Secretary of State's uprating statement and the initiative to help those who are unemployed back to work through buying a bus pass. However, does my right hon. Friend accept that for that to be effective, there must be a bus on which they can travel? Does he know that in Birkenhead, where there are 15 per cent. unemployed, 38 per cent. of job vacancies were withdrawn at the jobcentre 20 miles down the road because no one could travel to the area to take up the jobs?

I make a plea to my right hon. Friend that when he develops his welfare-to-work strategy, which Labour Members greatly welcome, he bears it in mind that his next initiative may need to link the unemployed to where the jobs are. According to the latest data, more than 200 constituencies have fewer people in work now than when we were elected in 1997, although there are 1.5 million extra jobs in the economy. One of the reasons for high unemployment in some areas is not that people do not want to work, but that they cannot travel to where the jobs are located.

Mr. Smith: I thank my right hon. Friend for his welcome for the statement and recognition of the contribution that the bus pass can make, and the other help that access to the #300 discretionary fund can provide.

My right hon. Friend made important points. They are precisely the matters on which our action teams for jobs, based in the most disadvantaged areas where unemployment is highest, can work. I urge employers, Jobcentre Plus and the Employment Service in his constituency and elsewhere to work with the action teams for jobs to realise our provisions.

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In the experience of the action teams for jobs, more than 10 per cent. of those who volunteered to take advantage of their help are incapacity benefit recipients. Moreover, that applies to more than 10 per cent. of those whom the teams got into jobs.

Mr. Steve Webb (Northavon): I thank the Secretary of State for his statement and welcome some of the measures that he has proposed to make it easier for disabled people to move into paid work.

I want to ask three questions on the aspect of the statement that the right hon. Gentleman glossed over: benefits uprating. A section of the statement is headed XBetter support for people on JSA". Without mentioning sordid matters such as cash, will he explain what 1.3 per cent. means for someone on jobseeker's allowance? Will he confirm my calculation that it means 70p or 75p? Does he believe that that is a fair reflection of the increase in the cost of living that unemployed people face in the next 12 months?

Secondly, will the right hon. Gentleman confirm that the pension uprating obeys what I would call Webb's law of benefits uprating: the increase in the state pension declines with distance from the last general election? Does he confirm that the pension increased by #5 when the election was being held, by #3 the following year because a promise had to be made, but by only #2 this year?

Thirdly, will he launch an immediate and urgent internal investigation into the Department? Earlier this month, it gave a straight answer to a written question. When the Department was asked for the real value of the retirement pension in today's prices in 50 years time, it replied that it would be 75p higher than now. Will he confirm that he is again asking pensioners to accept 75p, but that this time they have to make it last for 50 years?

What sense does it make for the pension, which is supposed to be the foundation of income in old age, to increase by only 75p above inflation over half a century, when the economy will double in size?

Mr. Smith: I thank the hon. Gentleman for his welcome, if such it was, for the statement. He referred to the section on extra help for recipients of JSA. Extra help is being provided for those whose application for incapacity benefit has been turned down, and who will go on to JSA. They will be able to access early the help that the new deals provide. I hope that he will endorse that. The hon. Gentleman referred to the level of the increase. It is the inflation increase, fair and square. He also referred to the levels of increase in pensions, but, as I told the hon. Member for Havant, the cumulative impact of our pension increases, over and above inflation, is very substantial—as, indeed, it is for the poorest pensioners in receipt of the minimum income guarantee. We are making real inroads into pensioner poverty, which is something that the hon. Member for Northavon (Mr. Webb) ought to welcome.

Mrs. Joan Humble (Blackpool, North and Fleetwood): Will my right hon. Friend, in expanding the work of his Department in jobcentres, take into account the excellent work done in the community by organisations such as Progress Recruitment in Blackpool, a newly incorporated company that was

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previously an arm of local government? It is successfully getting people—often those with profound disabilities—into work, because it listens to what they have to say. It also listens to what employers have to say, and allays the fears of both. It matches people with appropriate jobs and offers them support so that their jobs are successful not only in the short term but in the long term. Will my right hon. Friend look at enhancing the work of such organisations?

Mr. Smith: Yes, indeed. My hon. Friend makes a good point, and I join her in congratulating groups such as Progress Recruitment on their work. There are important lessons to be learned from how the new deal for disabled people is working successfully, and from other initiatives being undertaken by voluntary organisations in the community. They will have a central role to play in the collaborative working that we envisage as a crucial part of the new pilot.

Mr. Archy Kirkwood (Roxburgh and Berwickshire): Will the Secretary of State confirm that there will, as usual, be a full debate on the uprating element of his statement? The contributions from the two Front-Bench spokesmen show that much needs to be discussed, and it would be beneficial if that could be organised before Christmas. As Chairman of the Work and Pensions Committee, I welcome the welfare-to-work aspects of his statement. The Committee is about to undertake an inquiry into that very important subject, on which I would like to ask the right hon. Gentleman two questions.

First, the Department's own research on moving from sickness into work, published in 2001, showed that it was time to examine the conceptual basis of incapacity benefit, and the way in which it is assessed. Will the consultation that the Secretary of State has launched include measures that consider the essence of how incapacity benefit is measured currently?

Secondly, the Secretary of State mentioned encouraging employers to manage health at work more actively. Does he agree that we need to use stronger language than that? If we are to create new vacancies for people who are not in good health, or who are disabled, it will take real encouragement and some pretty hard persuasion by the Government, using all their means, to establish vacancies for which disabled people can apply.

Mr. Smith: On the hon. Gentleman's first question, I expect the debate on the order to take place in the normal way. On his subsequent questions, I said in my statement that we needed to shift further the philosophy of the tax and benefit system from one based on what people cannot do to one based on what they can do. I take it that that is the sort of conceptual shift to which he referred. In the pilot areas, we shall build on the experience of the personal capability reports that will provide essential information to feed into the assessment, through which clients, jointly with Jobcentre Plus, medical advisers and those organising their rehabilitation will need to craft the right sort of programme to help them to move into jobs. There will, of course, be lessons to be learned from that process.

Of course, we need to do more to encourage employers. As I said in my statement, there is a good business case here as well. We should not miss any

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opportunity to put across the message that it is in a firm's own interests to have an enlightened recruitment policy, as many that have successfully recruited disabled people, or people who have suffered illness, will attest. In addition, as part of the approach that I have outlined today, the Health and Safety Executive is working with Middlesex university on a good practice guide to help employers to make the most of this kind of opportunity.

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