Examination of Witnesses (Questions 120
- 139)
MONDAY 15 NOVEMBER 2004
Department for Work and Pensions and Department for
Education and Skills
Q120 Mr Davidson: Mr Anderson, a
big section of this Report deals with delivering services locally.
Can you explain to me why an area like my own, which has one of
the highest unemployment rates generally across all ages in Scotland
and in most of the UK, does not even have a Jobcentre?
Mr Anderson: In terms of new Jobcentre
Plus?
Q121 Mr Davidson: How can you be
delivering services based on local knowledge when a constituency
like mine does not have a Jobcentre?
Mr Anderson: The former Social
Security and the old Employment Service did not have a Jobcentre
in every single town in the country, that is true, but they endeavoured
to have a location that was within a sensible travelling distance
from every town. Obviously it is not possible to be in every single
location.
Q122 Mr Davidson: You would have
thought that one of the constituencies that has got the highest
unemployment rate in Scotland, and amongst the top 20 unemployment
rates in the UK, would have deserved a Jobcentre in the past,
would you not?
Mr Anderson: The services would
be provided by an office that is local to the area. Whether it
is in a particular constituency or not, I could not comment.
Q123 Mr Davidson: There are Jobcentres
round about it but none in my constituency. You are moving towards
providing one but not quickly enough. Perhaps you will go back
and chase that up for me.
Mr Anderson: I am aware of the
discussions that have been involved, yes.
Q124 Mr Davidson: We are thinking
of naming it the Jane Kennedy Memorial Jobcentre if she gets it
open. In terms of incentives for people to go back into work,
is there any evidence that prevailing local wage rates make any
difference to whether or not work is seen to be more or less attractive?
Mr Anderson: I have not seen any
evidence along those lines, no.
Q125 Mr Davidson: Speaking to people
locally, the whole question of incentivising them by making sure
that there is going to be a positive plus is one of the main thrusts.
I am surprised that local prevailing wage rates would not have
some sort of influence. Is it the sorts of jobs for which people
are considered eligible or applying for that is significant? Are
there any statistics on any of this that can guide us?
Mr Anderson: The purpose of the
tax credit system is to try to make sure for everybody that the
move off benefits into work makes a meaningful step forward in
terms of their income and obviously the tax credit system is being
developed as we go along to improve that position.
Q126 Mr Davidson: Okay, I understand
that. Can I just clarify whether or not there is any impact upon
the take-up of employment by the over-50s as a result of substantial
immigration, particularly, say, from Eastern Europe and so on.
Constantly I am being told that there are a whole load of jobs
in the West of Scotland that cannot be filled but with the numbers
of people coming in from Eastern Europe they can be filled. I
have never been entirely clear whether or not they could have
been filled by people incentivised out of Invalidity Benefit
or unemployment who are over 50.
Mr Anderson: I do not believe
there is any evidence that suggests that new people coming into
the country have altered the position that there are a lot of
vacancies in the economy. In most parts of the economy at the
moment it is not the number of vacancies that is the limiting
factor on people getting into work, a lot of it is about attitude
and about how far you can persuade people it is sensible for them
to travel to take up a job. There are some fairly tight knit communities
that really do not want to move from a very tight area and we
have to work very hard with them to persuade them to look slightly
further afield.
Q127 Mr Davidson: Can I ask about
your successes. To what extent have the successes that you have
had so far, which to some extent have come out of the document,
been creaming off from the top, as it were, those who are most
likely to be getting into work and most likely to be highly motivated
and so on? To what extent, as we go on, will you find it ever
more difficult because the people you are tackling have greater
problems, or is that an unfair look at it and it is all equal?
Mr Anderson: I think there must
be some truth in that statement. For example, if you take New
Deal 50 Plus it is a voluntary programme and, therefore, by their
nature the people who volunteer are likely to be those who are
closest to the labour market because they have volunteered and,
therefore, those who do not volunteer and end up getting to New
Deal 25 Plus after 18 months are pretty likely to be harder to
help at that point than those who volunteered earlier. Generally
speaking, those people who have been on Incapacity Benefit for
a long time are likely to be harder to help than those who are
recently moving on to benefit. There is an element of that, yes.
Q128 Mr Davidson: I understand the
point about incentives and people being better off if they go
into work. One of the things that has been discussed in my own
area, but not with Jobcentre staff because we do not have a Jobcentre
there, is the disincentive of taking a job and then finding that
you cannot cope with it and coming back off again and not being
able to get back on to Invalidity Benefit because you have to
jump through all sorts of hoops and start again. What steps are
you taking to overcome that?
Mr Anderson: I think in the Pathways
to Work areas there are lots of extra opportunities for people
to test the work experience without putting at risk their status,
as it were, and I think we have recognised that is an important
part of the mix, that we have to understand better just how much
impact that will have.
Q129 Mr Davidson: Is this going to
be rolled out across the UK as a whole?
Mr Anderson: As Sir Richard said,
at this point we do not have sufficient evidence from the Pathways
to Work pilot to be certain that it would be a good investment
to roll out nationally and, therefore, our Spending Review provision
did not give us money to roll it out nationally. Once the programme
has been evaluated, obviously it will be for ministers to decide
whether at that point they wish to allocate resources to it.
Q130 Mr Davidson: What is the sort
of timescale in terms of the evaluation and possible decision?
Mr Anderson: There will be information
coming out at various stages and clearly it depends how strong
the trends are and at what time they emerge. I think I am right
in saying that the first statistics are due to be published early
next year.
Sir Richard Mottram: I think we
are talking about evaluation in 2006.
Q131 Mr Davidson: 2006?
Sir Richard Mottram: Yes.
Q132 Mr Davidson: That seems quite
a long time to me. I do find this surprising. It is an issue that
constantly gets raised in these sorts of discussions, that the
disincentive to taking a risk is that you cannot get back again.
I am surprised that it will take until 2006 to clarify that.
Sir Richard Mottram: The evaluation
that I am talking about is looking at the whole effect of Pathways
to Work.
Q133 Mr Davidson: This particular
issue seems to me, and to people locally, to be the main issue,
getting people over 50 into work, de-risking that decision. Are
there no prospects of anything being done within the foreseeable
future? What timescale? Three years?
Mr Anderson: I am sure if there
was learning from the pilots that gave us a clear indication earlier
than that, that we might find ways of incorporating that into
other programmes. That is not quite the same as rolling out the
whole of the Pathways to Work activity nationally. That is not
to say we could not learn lessons from earlier evaluations.
Q134 Mr Davidson: With regard to
this particular lesson, which I do not think you have to learn,
it is already learned as far as I am aware, what sort of timescale
might there be for that being rolled out more widely, like in
my constituency?
Mr Anderson: At this point we
do not know that.
Q135 Mr Davidson: Is that "do
not know" within the next five years, 10 years, two years?
Can you give me any hope at all?
Mr Anderson: The full evaluation
of the Pathways is due to be completed in early 2006. There will
be some information that will be starting to emerge next year.
During that time, the sort of issue that you are describing will
obviously become clear.
Mr Davidson: Will it become clear before
there is a Jobcentre built in my constituency or afterwards?
Chairman: I think you have made your
point.
Q136 Mr Davidson: A good point can
always bear repetition, I find. In terms of role models, apart
from B&Q I have not been aware of any particular companies
that have picked up this question of employing older people. I
am not aware of anybody locally being held up as an example of
good practice, either an individual or a firm. Obviously I might
have missed it but I just wonder is there anything that you intend
to do in order to demonstrate that people like them could do that
as well?
Mr Anderson: We are working very
closely with the National Employer Panel to understand how their
employer coalitions can help us get the message across to employers
because all the evidence suggests that employers are more convinced
by other employers than they are hearing from us. We have employer
coalitions around the country who will help us do that. We will
be putting more resource into persuading employers ourselves.
We have specialist employment advisers who are now on our books
getting this message across but ultimately I think the success
will be through the NEP.
Sir Richard Mottram: Can I just
add a point which may be helpful. Out of the Age Positive campaign
and all of the work that we have been doing there, there are a
number of employers we could quote—I just gave B&Q,
I was being a bit reticent about quoting individual companies—Tesco,
Marks & Spencer, British Telecom, the Royal Bank of Scotland,
and others, and I do not say this is the complete list, where
we have a very active partnership with them in spreading the word
across employers generally that we must break down ideas about
age discrimination. The Department itself through the Age Positive
campaign, and there will be more done on this over the next couple
of years in the run-up to the age discrimination legislation,
is out there proselytising alongside private sector partners the
value of older workers.
Mr Williams: Welcome back, Sir Richard.
It is a great pleasure to have you here again. You seem to have
been missing for rather a long time from our hearings.
Mr Bacon: Saved by the bell!
The Committee suspended from 5.57 pm to
6.06 pm for a division in the House
Q137 Mr Williams: According to some
of the papers we have from the National Audit Office I see that
your Department is likely to achieve its Public Service Agreement
target for increasing the employment rate for older people, which
goes on to say, rather Delphically, "before taking account
of the economic cycle". That could mean either way. Does
that mean that you are going to reach your target or does it mean
that you will only reach it by virtue of the benefits of the economic
cycle?
Sir Richard Mottram: As you say,
the target was expressed in terms of "taking account of",
or words to that effect. We have not yet found a satisfactory
basis for working out how we take account of the economic cycle.
Where we are is that we will achieve a significant rise in employment
of people between 50 and the state pension age of two percentage
points over the Spending Review period. That is all I can say
really.
Q138 Mr Williams: It answers my question
adequately. What it means is you are not going to reach your target—
Sir Richard Mottram: No, we are
going to reach our target.
Q139 Mr Williams:—other than
by virtue of the natural increase in employment arises from the
economic cycle?
Sir Richard Mottram: No, no, that
is not what we are saying at all. What we are saying is that it
is very difficult to work out precisely the effects of the economic
cycle. We are not saying that it is the economic cycle that has
produced this result. The economy basically has been growing at
2% to 3% for a number of years now. We have shifted the employment
rate of people over 50 to state pension age by two percentage
points over a three year period. That is statistically significant
and we believe that it meets the target. The technical wording
of the target means what it means.
| 
