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Standing Committee Debates

Draft Jobseeker’s Allowance (Jobseeker Mandatory Activity) Pilot Regulations 2005

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Fourth Standing Committee on Delegated Legislation

The Committee consisted of the following Members:


Mrs. Janet Dean

†Alexander, Danny (Inverness, Nairn, Badenoch and Strathspey) (LD)
†Boswell, Mr. Tim (Daventry) (Con)
†Chapman, Ben (Wirral, South) (Lab)
†Clelland, Mr. David (Tyne Bridge) (Lab)
†Gilroy, Linda (Plymouth, Sutton) (Lab/Co-op)
†Goodman, Helen (Bishop Auckland) (Lab)
Goodwill, Mr. Robert (Scarborough and Whitby) (Con)
†Heppell, Mr. John (Vice-Chamberlain of Her Majesty’s Household)
†Howarth, Mr. George (Knowsley, North and Sefton, East) (Lab)
†Johnson, Mr. Boris (Henley) (Con)
†Joyce, Mr. Eric (Falkirk) (Lab)
Laws, Mr. David (Yeovil) (LD)
†Main, Anne (St. Albans) (Con)
†Moran, Margaret (Luton, South) (Lab)
†Plaskitt, Mr. James (Parliamentary Under-Secretary of State for Work and Pensions)
†Randall, Mr. John (Uxbridge) (Con)
†Trickett, Jon (Hemsworth) (Lab)
Frank Cranmer, Glenn McKee, Committee Clerks

† attended the Committee

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Wednesday 7 December 2005

[Mrs. Janet Dean in the Chair]

Draft Jobseeker’s Allowance (Jobseeker Mandatory Activity) Pilot Regulations 2005

2.30 pm

The Parliamentary Under-Secretary of State for Work and Pensions (Mr. James Plaskitt): I beg to move,

    That the Committee has considered the draft Jobseeker’s Allowance (Jobseeker Mandatory Activity) Pilot Regulations 2005.

It is a pleasure to serve under your chairmanship, Mrs. Dean. I welcome the opportunity to introduce the debate on these draft pilot regulations.

At present, approximately 31,400 people aged 25 or over claiming the jobseeker’s allowance flow over the six-month threshold every month in any one year. The existing employment provision, new deal 25-plus, is available only at the 18-month stage of a claim.

Nearly 80 per cent. of people claiming the jobseeker’s allowance leave the register within the first six months with minimum intervention from Jobcentre Plus. Research indicates that the longer a person is unemployed, the harder it is for them to enter employment and that at the six-month point, motivation and confidence begin to decline sharply. We therefore plan to implement the jobseeker mandatory activity pilot scheme, or JMA, which will start in April 2006 and run for two years.

The regulations that we are discussing introduce the JMA programme and the changes to the sanction regime. The JMA programme will build on current back-to-work help and provide an opportunity to test the effectiveness of an early mandatory intervention sitting before the current 18-month trigger point by targeting all JSA customers aged 25 or more at the six-month stage of their claim.

The programme will provide a three-day motivational course followed by three fortnightly follow-up personal adviser interviews. The objectives of the programme are to target effective help by giving early direction, support and guidance to help customers identify a route into work and look at the financial impact of the mandatory new deal options that take place at the 18-month stage of a customer’s claim.

The three-day courses are to be delivered by external organisations recruited by competitive tender. The courses will focus on examining job aspirations, motivation, emphasising rights and responsibilities, finding ways into work and job-search skills. Customers will leave the course with an action plan. The three follow-up interviews will be carried out by a
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personal adviser in the Jobcentre Plus office. Advisers will ensure that customers pursue their action plans and actively search for a job.

Mr. Tim Boswell (Daventry) (Con): Could the Minister tell the Committee—it is not entirely clear from the explanatory documents—what the pattern of the phasing of those mandatory interviews would be after the six-month period and the short course? When would those subsequent interviews take place?

Mr. Plaskitt: They follow at fortnightly intervals after the course is completed.

Jobseekers will be required to attend and participate in all stages of the JMA programme. A one-week sanction will apply for each failure to attend the course or any of the three follow-up interviews. The one-week sanction, rather than the longer sanctions for non-attendance of the new deal programme, is considered appropriate to the short duration of the JMA programme. Safeguards are already in place to ensure that those who have good cause for failing to participate will not be sanctioned.

Process changes have been made to ensure that sanction decisions relating to JMA are made quickly. Our staff are fully trained in the application of sanctions, which ensures that customers understand their rights and responsibilities and the impact of any sanction imposed. Jobseekers will have the standard right to reconsideration and appeal against any adverse decision, and the individual’s rights will therefore be further safeguarded.

When the sanction is imposed, hardship payments will be available as a safety net. The availability of hardship payments will provide immediate protection for vulnerable groups. A full evaluation of the programme will be carried out, consisting of both qualitative and quantitative studies. The methodology will include interviews with project staff, local office staff and customers. The objectives are: to find out the extent to which the pilot programme affects behaviours and improves the soft-skills abilities—those relating to motivation, confidence, job searches and job applications—of JMA customers; to inform good practice; and to assess whether in the pilot areas the programme results in an increase in off-flows from unemployment compared with comparator areas. The results will be used to inform future policy development and any decision about whether JMA should be extended nationally.

Section 29(1) of the Jobseekers Act 1995 states:

    “Any regulations to which this subsection applies may be made so as to have effect for a specified period not exceeding 12 months.”

We are making this proposal for the period from 3 April 2006 to 2 April 2007 and we intend to submit further regulations to the House before this statutory instrument expires to seek an extension of the pilot scheme for a further 12 months. I propose, subject to the approval of these regulations, to run pilots in 10 Jobcentre Plus districts. It is projected that about 76,500 customers will become eligible for the two-year pilot that will commence in April next year.

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Following consultation with the Social Security Advisory Committee, these proposals have its full support.

Mr. John Randall (Uxbridge) (Con): I am always fascinated to know how the pilot areas are chosen. Is it done on the basis of the number of claimants, or just on the basis of those who are willing to take part?

Mr. Plaskitt: We take a number of factors into consideration. We wanted a reasonable geographical spread and we also wanted to try to concentrate the pilots in areas where the evidence shows that we have something of an issue with a larger proportion of people being on the register for six months or more compared with other areas. We brought those considerations together when making the selection.

In conclusion, the draft regulations form a key element of the Government’s back-to-work agenda. They incorporate safeguards to ensure that jobseekers are treated fairly in the light of their individual circumstances. I am satisfied that they are compatible with the European convention on human rights and I commend them to the Committee.

2.37 pm

Mr. Boswell: I think that this is the first time that I have spoken under your chairmanship, Mrs. Dean. I will not seek to abuse it and I look forward to the experience. These are important matters and I am grateful to the Under-Secretary for having introduced them clearly and with a degree of sensitivity that was welcome, the more so because I understand from an informal conversation that the lead Minister is the Minister for Employment and Welfare Reform, who is indisposed. I am sorry that she is not able to be with us, but the Under-Secretary replaced her very adequately.

I am sorry that the Minister for Employment and Welfare Reform is not here because I was going to quote, with some approval, something that she said recently at a European presidency conference in Cardiff. In the way in which Ministers occasionally do when they want to make a point rather firmly, she said:

    “The very survival of the welfare state depends on more people in work”.

That is a perfectly reasonable sentiment, with which I concur. Opposition Members are anxious to have an active labour market policy, as long as it is successful and sensitive. To achieve that, it needs to be well targeted and therefore—I will come to this in a moment—well prepared, researched and considered. That is even more the case, given that—there is a slight barb in this comment—as the Under-Secretary and the Committee will be aware, after a long period of quiescence or improvements in the situation, the jobseeker’s claimant count has risen for the past nine months on the trot. I hope that that will not continue and that these moves will be instrumental in helping to arrest that, but it is an important consideration.

In general, I support piloting initiatives, subject to the following conditions: that the pilots are real and that lessons are learned from them if they arise. That has not always been the case in my experience of the Government or the Department for Work and
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Pensions. I remember that a case a year or two ago indicated that those who participated in the new deal for lone parents—although it is one of the statistically cheaper of the Government’s new deal programmes—had a worse experience finding jobs after their involvement than they would have done if they had not taken part at all. I am not making a cheap point, but it is important that we always consider such matters carefully and dispassionately.

In principle, I am very much in favour of early intervention. In this case, as the Minister rightly said, it will take place after six months rather than what we might call the standard 18-month period. Embedded in what he said was an endemic concern, which I know the Department has always displayed, for not involving itself in deadweight costs. The Minister suggested that it was sensible to let people have six months in which they could look for jobs themselves, and that they would probably get them, but a limited number of people would not have been placed within six months.

The Minister suggested that disillusion, disaffection and a disheartening tends to kick in at that point. I am not sure that we can be that precise, but as a general point—I draw on my previous involvement with disability and pathways issues that we are not debating this afternoon—I agree with early intervention in principle. If the Government start to introduce programmes of intervention, whether public or private sector, or contractor-led involvement in more intensive activity, that is to be welcomed in principle. At least we shall now have a chance, if they are properly piloted, to see how they work.

I thought it appropriate to put up front the positive points I bring to the Committee, but I have a number of reservations that it is right I bring forward as a balance. Based on the data we have seen, I remain somewhat sceptical—I choose my remarks rather delicately—as to the efficacy of the new deal, certainly in relation to the claims made for it by Ministers. It still reports a high cost in job placement and a very high recirculation rate. I note that in the explanatory memorandum, the Department said:

    “Currently, people leave benefit faster after the New Deal Gateway than before it.”

That is a partial claim, but an awful lot of them go out of one door and come back in to participate again. I see my hon. Friend for this purpose, the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander) nodding in assent. It is no good for Ministers to say that someone getting a job or being taken off the books is a triumph. It is very welcome but it is not the end of the process. The Opposition still have very real reservations.

I hope that the Minister will not take my second point as the shorthand, left-wing perspective, but I am still sceptical of what might be termed the sanctions-driven approach. It sounds great for Ministers to say, “If they don’t turn up, we’ll have to take action.” That may sometimes be necessary and it is the purpose of the pilots to see whether that component works. I am most interested in the fact that the pilots are taking
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place to get active job placements; the Minister has asked whether we can do anything about it if people refuse to turn up, and the preferred route is sanctions.

I do not know, and I do not think that I have ever had a coherent account from Ministers—perhaps because I have not asked in the right terms—whether there is any real evidence that sanctions work. They sound good on paper, and they sound balanced, but I am not sure whether they necessarily represent the best way of doing things.

Will the Minister respond to a specific point? I am not absolutely sure how this works, but I notice that the sanctions relate to other benefits, including housing benefit and council tax. The Chancellor of the Exchequer said that there would be some further relaxation of the linking rules between the receipt of benefit and the return to work in the new year arrangements. In principle I respond warmly to that. Several members of the Committee will, I think, take an interest in the problems of people with intermittent conditions, including mental illness. It would be unfortunate if people got themselves into the position of being sanctioned. I accept the spirit of the Minister’s assurance—that if they had good cause, such as illness or a domestic emergency, there would not be a problem—but I do not want people to fall foul of the linking rules just because that happened. Perhaps the assurance that I seek from the Minister is about the need to ensure that any sanction that the Committee may decide to approve is proportionate to the alleged offence or failure that has been committed.

I am a little concerned about a rather bold statement in the impact analysis that appears in the explanatory memorandum—there is no separate regulatory impact assessment on the ground that the private sector is apparently not affected. It states:

    “There is no impact on the Public sector.”

There may not be, with respect to regulation or compliance and the rest of the public sector, but I should have thought that by definition there would be some impacts on the department. First, there must be a public sector commitment of resources, time and training, and therefore costs, for the process of the mandatory short intensive interviews. All right, they may be let out, but someone has to carry them out—and in an appropriate way. That applies to the follow-up interviews too, which do, I think, fall to Jobcentre Plus staff. The Minister may want to confirm that.

Secondly, although I appreciate that the course is mainly about what the Minister might reasonably call job motivation or job preparation, if an action plan is to be drawn up at the end of the process, an appraisal of the suitability of the individual for types of employment is necessary. The Minister is nodding. An attempt must be made to fit round pegs into round, not square, holes. That requires something that the Employment Service does all the time and for which I commend it—an effort to find the right modes for steering people forward. That is not to say that what is proposed should not happen, but Ministers should not say that it will not cost anything.

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I also have concerns, which I will not dilate on this afternoon, about the performance of Jobcentre Plus, because of the new customer management system, and the difficulties that have arisen there. The Public and Commercial Services Union and others have expressed concern about people losing their jobs, and about the possibility that the strain on the department is too great. I do not want for a moment to take a disproportionate approach, or to say that the task cannot be done, but Ministers need to take an interest in what it will require the department to do.

A further point that I want to make, following on from the comments that I have already made about an action plan, is that there is a need—whether the private sector is involved or not—for a departmental interest in seeing that the work preparation courses are relevant to removing deficiencies that may be incidental to the individual’s difficulty in finding a job. I am concerned, for example, as the Minister may know, with skills for work. Ministers—not necessarily in the Department for Work and Pensions, because it is not strictly all its responsibility, but in other Departments—have said that all is going swimmingly. However, I heard on the 1 o’clock news today that the adult learning inspectorate has expressed grave concerns about the outcome of skills for work. No one is saying that it is not a good idea, but we are saying that it may not work as it is intended to. Clearly, unless the department gets its act together with its contractors, and gives people a course and counselling relevant to their needs, things may not work as they should.

One more point is semi-ritual to me, because of the geographic make-up of my constituency, and I always like to get departmental answers on the subject. One of the pilot areas in the south-east is that of Berkshire, Buckinghamshire and Oxfordshire, as a moment’s reflection will remind the Minister, who has an adjacent if not immediately contiguous constituency to mine, which is in Northamptonshire but not in that region. On the other hand—I am not unique, although I sometimes like to pretend I am—my constituency has a huge spread of postal regions.

I happen to live in Northamptonshire but in the Oxfordshire postal region. Banbury is effectively my local town for many administrative purposes. Many jobseekers from my constituency sensibly turn up at the Banbury office, and they usually do not get turned away. I have had an interesting difficulty recently that involved a constituent who goes to the Milton Keynes office, which is contiguous with although not in my constituency, because the Northampton office had not passed the papers over. That can all be smoothed out, but it would be useful if the Minister could clarify that the sampling frame for the pilot will be by office, whether people turn up or not, and irrespective of geographic reference. It is important to be clear about that.

It all seems a little bureaucratic and inflexible compared with the job clubs that the Government wound up some years ago. I always thought those were rather positive. It may be, from what the Minister has said about the three-day courses, that the idea of job
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clubs and getting people ready to make applications for jobs if they have been a bit backwards in doing so in the past is being reinvented. That is to be welcomed.

I genuinely have some reservations. Behind a lot of things that the Government do there is a whiff of authoritarianism and sanction when a degree of sensitivity is often more appropriate for those who are vulnerable and may not have a great deal of protection. It may not help them if we are too tough. The Minister might rightly reply, “Yes, and it may not help them either if we are not prepared occasionally to tell them to answer to their own responsibilities.” I understand that, but it is a difficult balance to find.

I do not think that we should have fixed minds on the subject. Above all, we should not bandy it about on ideological principles. We in the Conservative party are content for the regulations to go through and then they need rigorously and with a degree of scepticism to be submitted to the judgment of events. We do not want to bang them through and find that no one is listening to the lessons that have been learned.

2.53 pm

Danny Alexander (Inverness, Nairn, Badenoch and Strathspey) (LD): It is a pleasure to serve in the Committee under your chairmanship, Mrs. Dean, and to be speaking opposite the Minister for the second time today. I add my congratulations to those of the hon. Member for Daventry (Mr. Boswell) on the Minister’s eloquent presentation on the content of the regulations. I find myself concurring with many of the things that the hon. Gentleman had to say, not least because the Liberal Democrats also recognise the importance of early intervention in getting people back into work. The idea of intervening after six months rather than 18 seems, on the face of it, to be sensible, but I have a number of misgivings about the regulations and questions that I would like to raise with the Minister.

We have heard that the unemployment claimant count has risen for the ninth month in a row, and although it is nothing like the levels that we saw in the 1980s, it is worth making the point that efforts should be made to stop the number of new claimants increasing as well as to deal with those who have been on benefit for a period of more than six months.

Mr. Boswell: I think that I am right in saying—I am not speaking for the Minister—that the immediate problem with the claimant count is the stock, rather than the flow. The number of those joining the register has been reasonably encouraging, but they are sticking for longer periods. None of that, however, gainsays the importance of getting them back to work.

Danny Alexander: I am grateful for that intervention. I am sure that the hon. Gentleman was not speaking for the Minister, but he anticipated my next point, which is that the proportion of claimants moving into work rather than some other destination is steadily falling: it fell by 10 per cent. between September 1999, when 49.1 per cent. of people coming off jobseeker’s allowance made it into work, and September 2005, when 39.3 per cent. did so I should be
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interested to know what evidence the Minister has for saying that the mandatory activity that the Government are proposing will help to reverse that trend.

It is fair to say that some previous mandatory activity schemes have had a reputation for being not very well delivered, and not especially relevant to many of those who are asked to take part in them, due to a lack of individualised, personal approach to those people’s job-seeking needs. The use of a personal adviser under the regulations is welcome, but I wonder whether the work-focused course—the three-day motivational course about which the Minister has spoken—will take place before the interview with the adviser; or whether an adviser will be involved at the initial stage to help to shape the course for that individual and thus ensure that the course that they go through is suited to their needs, rather than a generic one through which everyone is shoved willy-nilly?

Will the courses be tailored to the local job markets? The Minister outlined a number of generic skills that would be highlighted in the course, including motivation and job-seeking skills, but it will be interesting to know whether there will be different content in the courses in the various pilot areas to focus on the different nature of the job markets in the east of England, for example, compared with Cumbria or south-east Wales. There are great differences.

Mr. Boswell: Does the hon. Gentleman not agree that it might be quite beneficial to adopt different approaches? We could, for example, have a hard-cop pilot in one area and a soft-cop pilot in another and see which worked better.

Danny Alexander: That idea has some merit, although I am not sure whether the Minister would agree to a soft-cop pilot. There might be a hard-cop pilot and an even harder cop pilot, given the discussion so far.

I was saying that the flexibility and the personalised nature of the course is important. Another relevant question is what training or experience the people or organisations conducting the courses will have. The explanatory notes say that the courses will be given out according to a contract, so it will not necessarily be provided by Jobcentre Plus staff. As the Minister will know, in my constituency and many others there are some good voluntary sector-based organisations, such as the SHIRLIE project in Inverness, which provide excellent back-to-work training and activity. I hope that voluntary sector organisations will be given a fair chance to use the skills that they have built up in a number of previous activities to deliver some of the work.

I should like to reinforce the point made about assessment after the pilots have run their course. What will the process be for assessing whether they have been successful? What role will feedback from people who have participated in the courses and from the companies with which they have been placed, or the voluntary sector bodies that have conducted the courses, play in the assessment?

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The impact on the number of people moving off jobseeker’s allowance and back into work is crucial to assessing the success of the pilots, but I remind the Minister that what we need is not a straight count of the number of people who have gone back to work, perhaps only for a few weeks. Sustainability of employment is vital. That cuts to the point that the hon. Member for Daventry made. I concur with many of his comments about the new deal. We are looking for sustainable employment, not just people going into a job and then going back through the new deal and being endlessly recycled in the system, as often happens. Sustainable employment should be the measure of success, at least in part.

I have a couple of questions on the sanctions regime. I concur with the overarching theme that it is important to encourage individuals to take responsibility for their own lives and for finding their way back to work. I guess that that is what has motivated the proposed sanctions regime. People taking part in jobseeker’s mandatory activity pilots will have to go through a four-stage process: the course, and three subsequent interviews. Does that mean that a participant could have benefit sanctions four times—in other words, could they forfeit four weeks’ worth of benefits or even more than that if they continually failed to turn up? Will the sanctions regime also apply to the action plan? The Minister said that one outcome of the course will be to develop an action plan for the individual. That will form part of the content of follow-up interviews with personal advisers, but will the participant be obliged to follow through the action plan on pain of sanctions?

I understand that it is usual in such cases for sanctions to apply to the benefit concerned—in this case, jobseeker’s allowance—but I notice in the explanatory notes that the sanctions could also apply to housing benefit. I would be grateful if the Minister confirmed that and said whether it would apply to every benefit that an individual receives. I have concerns about housing benefit sanctions, because they affect not just the individual concerned, but their home, family and children. Clearly, it is for that individual to take responsibility for their family, but I would be concerned if the Government introduced measures that could lead to families being thrown out on the street. I will be interested to know what the Minister has to say to that, not least in respect of the safeguards that he assured the Committee would be in place. Will those safeguards apply to families in a vulnerable state?

The Minister said that the regulations expire after a year, but the Government will seek to extend it for a further year. I wonder why a two-year time scale was not built into the regulations in the first place. Once the pilots have been assessed and their success or failure judged, if the Government wish to extend the pilot across the country, will further primary legislation be required, or will it simply be a matter of another statutory instrument following in a year or two’s time? Given the concerns about the regulations outlined in Committee, I am strongly of the view that if the
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Government assess the pilots and wish to roll them out across the country, that should be subject to debate on the Floor of the House, so that all the relevant concerns can be raised then.

3.4 pm

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Prepared 13 December 2005