1 THE IMPORTANCE OF HELPING
OLDER PEOPLE TO FIND EMPLOYMENT
2. 1. Around 2.7 million people aged between
50 and state pension age do not work. This represents an inactivity
rate of around 31%, which is higher than the overall average of
25% for all ages. Around 1.3 million (nearly half) are on incapacity
benefits (Figure 1). There are significant regional and
local variations in the number out of work, with a high proportion
on incapacity benefits in the North East and Wales and relatively
high proportion of those early retired in the South East.[1]
3. 2. There are individual, business and economic
benefits from the employment of older people. Working can
help to combat poverty, insecurity and social exclusion. Benefits
for employers arise, for example, from the proven reliability
of many older workers which can lead to lower staff turnover,
greater productivity and skills retention. Research by the Cabinet
Office, Employers Forum on Age and Age Concern suggests that the
relatively low level of employment among older workers costs the
economy £19-£31 billion a year in lost output and taxes
and increased welfare payments.[2]
4. 3. Of the 2.7 million not working, between
700,000 to 1 million people would like to work, with 200,000 actively
seeking a job. People over 50 can experience a wide range of barriers
to work, some of which are age related, whilst others such as
low skills levels can be experienced by people of all ages.
Increasing employment in recent years has meant that those relatively
easy to place have found jobs. Thus, an increasing proportion
of those remaining out of work are the harder to help who face
a number of barriers. In the Department's view the most significant
barriers are long-term health problems, lack of qualifications
and, for women, caring responsibilities. In some cases, people
suffer from more than one of these obstacles and there are additional
barriers such as language difficulties and lower levels of qualifications
for many from ethnic minorities.[3]
5. 4. Improving the position of the over 50s
in the labour market and tackling age discrimination in the workplace
are key parts of the Government's Welfare to Work strategy. The
Department for Work and Pensions has lead responsibility for improving
the employment position of older people and other disadvantaged
groups, and has taken a more active approach to assisting people
into work than was the case in the past. The Department has developed
and implemented a number of initiatives either on its own or with
a range of other public, private and voluntary sector organisations.
Those other government bodies involved include the Learning and
Skills Council, the Department for Trade and Industry and the
Regional Development Agencies. The networks are often complex,
particularly at local level where they may also include local
colleges, voluntary and community-based organisations and recruitment
agencies, although the Department does not consider them unmanageable.[4]
6. 5. Progress has been made against the Department
for Work and Pensions' Public Service Agreement targets to increase
the employment rate of people aged 50 and over, taking account
of the economic cycle, and to reduce the difference between their
employment rate and the overall employment rate of working age
people, over the three years to 2004. In this period, the Labour
Force Survey shows that the employment rate of people between
50 and state pension age has risen by 2%[5]
and the gap has narrowed by 1.7% (Figure 2). However, the
Department are unable to estimate the impact of the economic cycle.[6]
Although government programmes are helping some people into work,
the full extent of their contribution is unclear.[7]
The buoyant economy will have had some effect and demographic
changes, for example, the increase in women in work, are also
driving up employment rates.
Figure 2: The proportion of older people in work
is lower than that of working age people in general but has grown
steadily for over a decade
Source: Labour Force Survey
7. 6. Between April 1998 and September 2004,
the Department for Work and Pensions' estimated expenditure on
programmes to help the over 50s into employment was £823
million. Over this period, the Department estimates it has helped
around 250,000 people into work (Figure 3).
Figure 3: The Department for Work and Pensions spent
£823 million on helping up to 250,000 over 50s into employment
between April 1998 and September 2004
|
| Programme/Initiative | Launch year
| Expenditure on over 50s (£million)(i)
| Estimated job outcomes for the over 50s(ii)
|
|
| New Deal 50 Plus(iii) |
2000 | 246.5
| 158,000 |
| New Deal 25 Plus | 1998
| 238.5 | 42,100 (iv)
|
| Help for disabled people | 2002
| 199.4 | -
|
| Work Based Learning for Adults | 1998
| 62.4 | 21,200
|
| New Deal for Disabled People | 2001
| 45.1 | 14,400
|
| Action Teams | 2000
| 13.5 | 7,900
|
| New Deal for Lone Parents | 2001
| 8.4 | 5,100
|
| Age Positive Campaign | 1999
| 3.6 | -
|
| New Deal for Partners | 2000
| 4.5 | 100
|
| Research | N/A
| 1.2 | -
|
| Total | 823.1
| 248,800 |
|
|
Notes:
(i) Programme expenditure for the over 50s is calculated
by multiplying total programme expenditure by the percentage of
over 50s starters on the programme. Expenditure was outturn except
for April to September 2004 which was planned. Expenditure figures
do not include the Disabled Person's Tax Credit, Family Tax Credits
or the new Working Tax Credits, all of which acted as financial
incentives to work similar to the New Deal 50 Plus Employment
Credit.
(ii) For some programmes, data was not available for
the whole period. Where this is the case available figures have
been used to produce an estimate for the period.
(iii) Expenditure on New Deal 50 Plus includes payment
of the programme's Employment Credit which was superseded by the
50 Plus element of the Working Tax Credit for new claimants from
April 2003.
(iv) Includes job outcomes from Employment Zones.
Source: National Audit Office analysis of Department for Work
and Pensions data
1
C&AG's Report, para 1.5 and Figure 11 Back
2
ibid, paras 1.11-1.15, Figure 18 Back
3
ibid, paras 1.9-1.10; Qq 104, 116-117, 200 Back
4
C&AG's Report, Figure 4; Qq 15-16, 108 Back
5
C&AG's Report, paras 1.16-1.17; Q 137 Back
6
C&AG's Report, paras 1.18-1.20; Qq 137-140 Back
7
Q 29 Back
|
