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10 Apr 2003 : Column 466—continued
Mr. Bailey: Given the way in which the hon. Member for Havant (Mr. Willetts) rubbished the Government's rights and responsibilities agenda, perhaps the Minister would like to comment on the situation in my own local jobcentre? It offers a step up scheme, for which 102 customers have been identified as eligible, and 49 of the long-term unemployed, the most problematic people on the register, are now in employment under it.
Mr. Smith: That is indeed a success to be proud of, and I join my hon. Friend in commending not only the programme but our front-line staff in Jobcentre Plus, who work with partners in the private and voluntary sectors and make such a success of those initiatives.
From April next year, we will be able to take the devolution of power and responsibility to front-line staff further by giving managers powers to adapt new deals to local needs and introduce a new discretionary fund to give local managers new, enhanced flexibility to direct
resources to tackle local barriers to the labour market. With local discretion will go a new performance regime, with better rewards for the best performing managers and staff and a tougher approach to the worst performing, including replacing the management where that is what it takes. In every area, Jobcentre Plus specialist managers will match employers who need staff with unemployed people who need jobs. We are helping more people into work and ensuring British businesses, big and small, improve competitiveness by having access to the right employees at the right time.We will also target resources on areas of high need to provide a particularly responsive job placement service to employers. As nearly half of all vacancies are generated by small and medium-sized enterprises, a new team will work at the regional level across Jobcentre Plus to produce a step change in service to the small business sector, building on the success of Employer Direct, which is already taking 13,000 job vacancies a day.
We shall also take further action to address the needs of those facing additional and particular barriers to work. From April next year, specialist account managers will work with employers in areas of particularly high ethnic minority unemployment, and a new £8 million fund will be established for local initiatives to help people to find work in those areas. To ensure that people at risk of drifting into longer-term unemployment take every chance of a job, we shall bring in weekly signing for those on jobseeker's allowance between 13 and 19 weeks of unemployment. We shall also increase the area over which new JSA claimants will be expected to travel to find work.
In terms of making work pay, since 1997 we have reformed the system so that it pays to move from welfare into work. Too often, however, unemployed men and women say that losing their housing benefit means that it is not worth their while to work. So from next April, people on housing benefit who move into work will no longer be required to submit a new claim for housing benefit. They will simply inform the local authority and continue to be paid the out-of-work rate until their benefits are recalculated.
Ms Buck: I welcome the proposals to offset housing benefit against income to help to make work pay in high-value areas. May I, however, flag up one worry? There are people in my constituency who have been waiting for some time for their housing benefit calculations to come through, because companies such as Capita are taking some time to do the work, and this might also happen under my right hon. Friend's new system. Those people can build up massive overpayments, the repayment of which can lead to rent arrears and, in some cases, to the issuing of eviction notices. Will my right hon. Friend do what he can to work with local authorities to ensure that tenants do not unwittingly end up with serious rent problems because of housing benefit overpayments?
Mr. Smith: My hon. Friend makes a telling point. I acknowledge her experience and expertise in this area, and I always listen carefully to what she has to say. We are in fact already acting on these issues. We have made £200 million available to local authorities, for example, to improve their administration, which in many cases involves updating outdated information technology
systems. We also have a help team out there working with the worst-performing local authorities, and it is succeeding in helping to transform their performance.Like my hon. Friend, however, I suspect that there was something fundamentally flawed in the system of housing benefit that we inherited. That is why we are piloting the new approach—which was welcomed, at least in spirit, by the hon. Member for Havant—in which there will be a standard allowance that will depend on a person's family circumstances and income, rather than on the rent that they pay. That will be much more simple and straightforward to administer, because it will avoid having to poke around and assess every individual letting that is taking place within the housing benefit system. I know, because my hon. Friend the Member for Regent's Park and Kensington, North (Ms Buck) has talked to me about this as well, that there are particular challenges involved in bringing the standard housing allowance system into areas of great rent variability, such as the constituency that she represents. We shall learn from the pilots how best to deal with that.
There are now 200,000 more lone parents in work than there were in 1997, and, as the hon. Member for Havant had to acknowledge, their employment rate is now 54 per cent., compared with 46 per cent. when we came into office. That is good progress, but we need to do more. The Budget brings forward a package of measures to break down barriers to work. For many lone parents, the costs involved in looking for work are a disincentive. So, in a groundbreaking pilot, lone parents who voluntarily attend regular work-focused interviews and undertake job search will be offered an extra £20 a week to cover job search costs, rising to £40 extra a week—and topping up wages for a year—when they move into work.
While the minimum wage today is £147 for a 35-hour week, tax credits—much derided by the Conservatives—raise the minimum family income for a lone parent with two children to £276, even after tax, which is almost twice as much. We shall want to do more for lone parents who want to work part-time, as for many that is an important stepping stone into work in general. The housing benefit disregard announced yesterday, which will help 90,000 people, means that for lone parents paying £50 a week part-time work will pay £213 a week. That is what we are talking about when we say we must make work pay, and help people to move from welfare to work.
Mr. Wayne David (Caerphilly): I acknowledge and welcome what my right hon. Friend has said, but does he recognise that much more should be done about crèche facilities?
Mr. Smith: Child care provision of all kinds is extremely important. We have a child care strategy, and the substantial extra resources we are providing will provide hundreds of thousands of places in addition to the hundreds of thousands that have already been added to the existing number. Moreover, Jobcentre Plus means that in every area a child care partnership manager will
ensure that local child care provision, including advice given in jobcentres and support for employers, is properly co-ordinated.
Mr. Bercow: Will the right hon. Gentleman give way?
Mr. Smith: I should like to make a little more progress.
A flexible, dynamic economy must go hand in hand with a fairer society so that everyone has an opportunity to fulfil his or her potential. Since 1997 we have reversed the long-term trend of rising child poverty and reduced the number of families living on less than £10,000 a year by a third, and the Budget allows us to go further. We will tackle the cycle of low expectation—a cycle that can take people from low income in childhood, through low pay in adult life, to low income in retirement. The Budget allows us to give all children opportunities that have hitherto been confined to the few, by giving everyone a chance to build up some savings. The new child trust fund will give every newborn child £250, with double that amount going to the poorest.
The Budget confirms that pensioners with modest savings and occupational pensions will gain from pension credit, which will provide, on average, an extra £7 a week for half the pensioner households in the country. Here is a challenge for the Conservatives, who love to deride pension credit—along with all the other credits—and talk of people being sucked into means-testing. Half our pensioner households will be, on average, nearly £400 a year better off. Is the Conservative party going to take that money away from them? That is the question that it must answer between now and the next general election.
Taken together, our reforms will make pensioner households more than £1,150 a year better off in real terms, with the poorest third gaining over £1,600. Most pensioners have no income tax to pay, but those who do will benefit. Age-related personal allowances for the forthcoming year will rise to £6,610 for those between 65 and 74, and to £6,720 for those aged 75 and over. No pensioner will pay tax on an income of less than £127 a week.
Mr. Goodman: The right hon. Gentleman mentioned means-testing. According to the most recent take-up figures, did take-up of income support, jobseeker's allowance, council tax benefit and housing benefit go up or down?
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