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The Parliamentary Under-Secretary of State for Northern Ireland (Angela Smith): I congratulate the hon. Member for Belfast, North (Mr. Dodds) on securing the debate and on the reasoned way in which he expressed his concerns. I know that he has had correspondence with the Under-Secretary, my hon. Friend the Member for Brent, North (Mr. Gardiner), and I am sure the hon. Gentleman will appreciate the way in which my hon. Friend has dealt with the issues that cause him great concern. I put on record the apologies of my hon. Friend, who was detained on other business and is probably on his way to the Chamber.

It may be helpful if I outline the major factors and rationale for the closure of the Worktrack programme. The decision was taken against the backdrop of a significantly improving economy, with significant falls in levels of unemployment over recent years. In that economic climate and with increasing job opportunity, Worktrack was proving an expensive means of supporting and creating employment. In the future priorities of the Department for Employment and Learning, there was a change of focus towards a more targeted approach to unemployment and increasing emphasis on improving skills on an individual basis of personal support. I shall expand on that.

Worktrack was introduced in August 1999 when claimant unemployment was 6.2 per cent. Its objectives were to provide training and employment opportunities for those who were not suited to, or who were ineligible for, other labour market intervention programmes. That meant that it focussed largely, though not exclusively, as the hon. Gentleman noted, on the long-term unemployed and economically inactive. Worktrack is a temporary employment programme providing 1,000 places every 26 weeks, with the key aims of developing the skills and competencies of those engaged on the programme to help ease them back into the workplace, mainly by boosting confidence. Many who have taken part see it as a means of gaining experience of a modern workplace, new skills and work-related disciplines without the perceived high pressure of what some might term a "real" job. That is not to belittle the work that participants do on those placements.
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I am fully conscious of the valuable contribution that Worktrack has made in the hon. Gentleman's constituency and elsewhere in Northern Ireland. He spoke of 50 per cent. of participants progressing to employment. The rate was not quite as good as that, but it was significant—an average of 36 per cent. of participants have progressed into employment since the introduction of the programme. That is a commendable record and one to be proud of. However, we must recognise that as circumstances change, policies must change to reflect them.

Let me summarise the main arguments. First, the Government believe that the economic context in Northern Ireland has changed significantly. The employment market is much more buoyant than in former times and there are many more opportunities to re-enter the labour market. Secondly, given the changed circumstances in respect of employment, Worktrack, costing in the region of £13,000 per job, is an expensive means of creating jobs. It is important to realise that many of the people may have been offered jobs without the support of Worktrack, although that is difficult to quantify. Thirdly, given the changed circumstances, the Government considered carefully the recommendations of the employability task force report and the research behind the skills strategy, and decided that a more targeted approach to employment barriers, including the promotion of reskilling and upskilling on an individual basis was the way forward.

We have sought to create the conditions for increasing employment in Northern Ireland, as in the rest of the UK, by promoting economic stability, developing a policy framework that incentivises both entry to and progression in work, and putting in place new arrangements to assist those who are not in work. Economic stability has brought growth and the delivery of an increasing number of job opportunities. Improving incentives through reform of the tax and benefit system and the introduction of the national minimum wage have helped to make work pay. Support for those without work through the new deal and through the rolling out of the jobs and benefits offices across Northern Ireland is providing people with the help they need to move into work. The outworking of our skills strategy and the change in approach of the Employment Service will assist further in removing or reducing barriers to work for individuals.

The economy in Northern Ireland has made significant progress. The gross value added—GVA—per head rose in real terms by 17.2 per cent. between 1997 and 2002, the last year for which there are full figures. In the construction industry, it rose by some 70 per cent. compared with 45 per cent. in the United Kingdom, and in manufacturing by 21.5 per cent. compared with 3.8 per cent. in the United Kingdom.

It may be helpful to consider some of the information on the working-age population, which in Northern Ireland has risen by 60,000 people, or 6 per cent., since 1997. An estimated 721,000 people are in employment, the highest number on record. Unemployment has fallen from 8.1 per cent. of the work force in 1997 to 4.7 per cent. in the summer of 2004—a fall of some 26,000. Northern Ireland has experienced a greater proportional fall in unemployment than the UK as a whole. Since the introduction of the new deal in 1998, claimant unemployment has fallen by 51 per cent. to its current level of 2.7 per cent.
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That is not to say that all the issues involved in employment and employability are resolved. It is one thing to talk about statistics and figures, but every single percentage hides a real story of people who are desperately looking for work. The hon. Gentleman made that case when, in speaking about his concerns on behalf of his constituency as well as wider issues in Northern Ireland, he made it clear that there are still issues to be addressed. I assure him that there is no lack of commitment from the Government and that our changes of emphasis and delivery mechanisms will ensure that people have help and support in getting back into work.

Let me deal with some of the points that the hon. Gentleman made. He mentioned low skills and qualifications. The skills strategy includes proposals to offer a free first level 2 qualification. Acquiring skills will be an important dimension of employment policy.

The hon. Gentleman suggested that other provisions such as the new deal do not deal with the same issues as Worktrack. My hon. Friend the Under-Secretary has taken that on board and is examining ways of making all the remaining provisions accessible to all, including the economically inactive. I accept that Community Aid 2000 does an excellent job, and the Department will consult it on alternative developments. It can play a role in insisting that we continue to help those in most need who are looking for work.

The hon. Gentleman expressed concern about the loss of community resources. That is not an objective for the Employment Service, and the Department for Social Development provides essential resources for community development. Having said that, the Department plans to talk to providers on an individual basis to offer practical advice and assistance on the needs of the client group that may not be assisted following the withdrawal of Worktrack. The hon. Gentleman said there was a lack of consultation, but providers were notified in time to contribute to the budget consultation process.

I hope that that deals with some of the hon. Gentleman's concerns. The strongest argument that I would put to him is that the Department is carefully and actively trying to ensure that those who would have been covered by Worktrack will be covered by the new deal and other schemes. I appreciate that the hon. Gentleman's constituency has particular problems as regards unemployment. The unemployment rate is higher in his constituency, at 4.2 per cent., than in Northern Ireland as a whole, and male unemployment is 6.9 per cent. in his constituency. However, his constituency has the highest ranking in Northern Ireland in terms of local jobs, with a job density index—the number of jobs divided by the resident population of working age—of 1.48, compared with the Northern Ireland average of 0.75.

In broad terms, the picture is clear. Employment in Northern Ireland is higher than it has ever been, unemployment is lower than it has ever been, new businesses are growing at an increased pace, more people are engaging with further and higher education than ever before and the numbers taking up apprenticeships are growing. We want to do everything that we can to ensure that the hon. Gentleman's constituents participate in that prosperity. That is the context in which we must look at the ending of the
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Worktrack programme. We are trying to ensure that all those who would have been part of it can progress to other forms of training and skills upgrading.

Significant resources are committed to tackling those needs, most notably through the new deal with its package of financial support and opportunities. In certain circumstances, prospective Worktrack clients may have access to the full range of provisions already offered through the various new deal schemes. While it remains a priority for the Department to help people into employment, there is also a change in focus towards individualised targeting of need rather than the sustaining of direct employment programmes. In line with that change of focus, the Department will develop a menu of more flexible provision to help people into work. We know of plans in the rest of the United Kingdom to test a targeted approach described as building on the new deal, or BOND. We plan to do something similar in Northern Ireland.

It is essential for change to build on the strengths of the new deal and other programmes, as well as identifying new ways in which assistance for all who need it—but particularly those faced with the most intractable barriers to employment—can be improved. That can best be achieved through an approach that is targeted more deliberately at meeting the specific needs of individuals. Such an approach should make provision available to all groups, based on a flexible menu of modular provision.

Managers and personal advisers will be able to tailor provision according to their local labour markets and their clients' needs. Central to that will be working more closely than ever with partners in the statutory, private and voluntary sectors. The elements of the menu will be available to all clients, irrespective of the benefit that they receive. Personal advisers operating in the jobs and benefits office network will choose from the menu the type of support that meets their clients' needs most appropriately.

The Department is currently testing the client-centred approach in four pilot targeted initiative—TI—areas that have been designated because of their high levels of long-term unemployment and social deprivation. Two key components of the initiative are the introduction of a transitional employment programme—TEP—which targets the very long-term unemployed and the creation of job assist centres—JACs—which aim to strengthen community outreach services. TIs will also develop a co-ordinated service that builds on partnerships between statutory agencies, local voluntary and community organisations and employers, and will be tailored to individual needs through increased flexibility and access to employment measures. An evaluation of that approach is planned for March 2006, with the completed report expected in November of that year.

My hon. Friend the Under-Secretary has agreed to test a series of measures designed to reform the way in which people claiming incapacity benefits in Northern Ireland are supported in their return to work. I am sure the hon. Gentleman is aware of those measures, which
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are known as pathways to work. They reflect measures currently being piloted in seven areas in Great Britain. The intention is to introduce Northern Ireland pilots in autumn 2005 and additional funds have been secured for that work.

Pathways to work programmes focus on individuals and offer tailored support to help them return to work. The structure for new claimants includes a series of intensive mandatory work-focused interviews, new rehabilitation services provided by the health service, improved links with new deal for disabled people job brokers, and improved financial incentives—a return-to-work credit of £40 a week, with pre-employment training.

Early performance indicators from Great Britain suggest that between 15 and 20 per cent. of participants have taken up elements of the support package. Furthermore, in some of the pilot areas there has been an increase of between 8 and 10 percentage points in off-flows from incapacity benefits after four months on benefit. Those monitoring the pilot schemes are also reporting significant interest among existing incapacity benefits claimants, who are not currently required to take part in the programme.

In Northern Ireland, as in Great Britain, the probability of someone ceasing to claim incapacity benefits to enter employment is significantly reduced as long as the person continues to receive the benefits. We shall be working with those who have been receiving them for up to two years.

We should all recognise, however, that some people are faced with specific barriers that must be dealt with before they can gain access to employment. Later this year, work will begin to help people throughout Northern Ireland receiving working age benefits who are trying to move towards employment but, without additional specialist support, would be unlikely to succeed because of their personal circumstances. The programme will target those with drug and alcohol misuse problems, homeless people and those with a criminal record.

I trust that what I have said gives some idea of the scale of the work that the Department wishes to undertake, and that the hon. Gentleman recognises that difficult decisions were made during the planning of budgets. I understand that all lead providers have been contacted and that the Department's desire is for the transition from Worktrack to be managed as smoothly and sensitively as possible. Worktrack was highly successful in times of high unemployment, but the time has come to look at other ways of addressing the needs that clearly exist. I assure the hon. Gentleman that what is being done and what is planned for the future represent, in the current economic climate, a realistic and deliverable alternative to meet the needs of the unemployed—

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