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17 May 2007 : Column 349WH—continued

On learning those figures, we should think about what is happening in human terms. The report really says, “People on JSA go into the labour market and get a job for two or three months before their employer realises that they cannot understand the health and safety instructions on the wall; and that, very sadly, they lose their job, go back to Jobcentre Plus, sign on until they get another job for a couple of months and then they end up out of work again.” It is subsistence employment—going in and out of the labour market. It is a churn, and we must address the issue more seriously than we have done in the past.

On 12 February, the Minister said that there should be a requirement on migrant workers who do not speak English to take steps to improve their English. As far as I understood his announcement, it was to be a requirement—I think that he is nodding at me from across the Chamber. Philosophically, is it such a big leap from, “We the state are going to do our bit, be on your side and pay you—not a very big amount, but the JSA—every week to help you get a job,” to, “Should you not, therefore, as a citizen whom we are trying to help to learn reading and basic maths, work with us, and perhaps be required to do so?” It is just a question that I pose as much as anything else, but philosophically, given that the Minister made an
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announcement on 12 February about migrant workers who do not speak good English, I wonder whether it is such a big leap. Perhaps we should consider that issue.

On the skills pledge, I received a helpful brief from the British Chambers of Commerce that speaks favourably about the “Train to Gain” regime that the Government have introduced, and the new qualifications and credit framework, which has not been mentioned this afternoon. The BCC expressed its concern that the regime and the framework will not have bedded down or have been introduced for that long by 2010, when there is the implicit threat that employers will have to provide on a statutory basis the remedial training that I have discussed. I should like the Minister to respond later or to write to me about that issue. The BCC also commented on the sector skills councils, saying that there are rather too many of them and that they could be usefully rationalised. The brief is an important representation.

Harry Cohen (Leyton and Wanstead) (Lab): The hon. Gentleman is right about Lord Leitch pressing for the skills pledge and the related bargain, but Lord Leitch said that if there is a low take-up, workers should have a statutory right to training that is relevant to their employment. Are the Conservatives philosophically opposed to that idea?

Andrew Selous: No, absolutely not. There are two issues. I do not know whether the hon. Gentleman was present when I talked about what Professor Ashton said earlier, but I said that I am not sure whether it is right for an employer to pick up the tab for what a school did not do—either under my Government or under this Government. That is what I am saying, quite bluntly. Frankly, the employee has a right—a duty from society—to be taught to read and count. It should have happened at school, but if it has not, we cannot ignore it and pretend that it has. There should be a right to it from the public purse. I am very wary of loading the cost on to employers, who could reasonably say, “Why have I been paying corporation tax all these years to the Treasury to fund schools, when I have employees turning up who cannot read or count?”

On the issue of training that is useful to that employer, however, I am with the hon. Gentleman, because if the employer is going to benefit and profit from his business, it is right that he should pick up some of the tab.

Danny Alexander: Earlier, the hon. Gentleman seemed to suggest that individuals who have the lowest levels of skills, literacy and numeracy have an obligation or responsibility to seek skills, which is what he said that the Minister said in relation to migrant workers. Is the hon. Gentleman suggesting therefore that it should be a matter to which conditionality is applied in a benefit system?

Andrew Selous: Philosophically, that is an interesting question. I should like the Minister to reflect on it, but, like the hon. Member for North-East Derbyshire, I am deeply concerned about the large number of people who go through the claimant process and in and out of work with very low skill levels. We must address that situation. To help the hon. Member for Inverness,
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Nairn, Badenoch and Strathspey (Danny Alexander), I am neither being prescriptive nor annunciating specific Conservative policy. This is a Thursday afternoon debate, and it may be one of the few opportunities that we have for one of the consultations that the Minister said he was going to organise. I am asking the question in the spirit of these debates—no more than that. Perhaps we could leave party politics out of it, because the issues are too serious. I hope that we are all concerned about getting the issues right, and I merely pose the question at this stage—no more than that.

The Committee’s excellent report mentioned lone parents, and I agree that personal advisers should have discretion over whether there is a mandatory increase in the frequency of work-focused interviews. Time and again, from almost every Member who has spoken, we have heard about the need to treat claimants as individuals: not to mould them to the system, but to mould the system to the needs of the individual. Later, I shall say more about the way in which we can travel a great deal further along that path. The issue is tremendously important.

On page 20 of the Government’s response, I was particularly pleased to see recommendation 52, which talks about lone parents. The Committee said:

That is humane and sound. The hon. Member for Blackpool, North and Fleetwood may remember my making similar concerns known to the Committee when I was a member during the previous Parliament.

The Child Poverty Action Group, in its excellent submission to this afternoon’s debate, went into more detail. It talked about the increase, from 12 to 16, in the age of children as far as conditionality is concerned:

Again, that was the Committee’s sentiment in recommendation 52.

On that general point, it is also worth saying—again, the hon. Lady may remember my making similar comments in the previous Parliament—that the Department for Education and Skills has a role, through its overall responsibility for family policy, in trying somehow to help couples stay together. We have talked about Australia this afternoon, and the hon. Member for Inverness, Nairn, Badenoch and Strathspey said that he was off there soon.

Danny Alexander: I’ve been.

Andrew Selous: Then I wonder whether he came across the excellent family relationship centres that exist throughout Australia. They not only do remedial work and help with child support, but help families to try to stay together in first place. Whatever our politics, I hope that we all agree that prevention is better than a
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cure. I am not someone who just accepts that such things happen. We can do a little bit, as a Government and in the voluntary sector, to help couples to stay together. Organisations such as community family trusts do excellent work in this country; indeed, the one in my constituency—south Bedfordshire community family trust—does precisely that.

In relation to the over-50s, I understand from the report that there has been no reduction in the past decade in economically inactive people aged between 50 and the state pensionable age. The over-50s make up 40 per cent. of the non-working population of working age, and so are a vast pool of talent and expertise that could be wasted if we do not get things right.

Getting the training right for that age group is tremendously important, particularly as we have just put through the House a Bill that will raise the state pension age to 68. I have huge concerns, which I expressed in the Committee stage of the Pensions Bill to the Minister for Pensions Reform, about the lack of sufficient training for older workers. Someone who has worked in a steel foundry or elsewhere in heavy industry cannot continue in that work when they reach their early 60s. They need to retrain and be reskilled in order to carry on working until they can claim their state pension at the age of 68, but we are not doing enough.

I pressed the Minister for Pensions Reform to provide information on the number of workers over 60 who are out of work in each local authority area, and on the training and retraining opportunities available to them in those areas, but he refused to provide it. I hope that what I am saying will strike a chord with all members of the Committee. I urge them, and particularly those Labour Members here, to put pressure on DWP Ministers to look at this tremendously important issue, on which we need to do more.

I was also interested in what the Committee said about the issue of forced retirement, involving workers over the age of 65 who do not have adequate protection. A lady in precisely that position came to see me in my surgery last week. She had worked for Luton borough council all her life and, at the age of 65, had applied to keep her job. The council went through the process of deciding whether she could, but she was told that she could not. She was a bright, intelligent and capable woman, who needed the income and enjoyed going to work. As a result of having left the employment of Luton borough council, she now cannot work for any other local authority in Bedfordshire. Future generations will look back with incredulity at our society, for telling people when they reach retirement, “That is it—you can be forcibly got rid of.” To me, that is the equivalent of saying that people who are 6 ft 5 in or who have brown eyes can be got rid of. That is how we will be viewed.

I am not blind to employers’ concerns that, effectively, they will have to keep a file on every one of their workers if they should want to dismiss them beyond the state retirement age. However, I cannot believe that it is impossible to reach a workable solution that will give workers better protection, but also ensure that employers can get rid of workers over retirement age who are not up to their jobs, as sadly they will need to do on occasion. I note that the issue is
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currently before the European Court of Justice, as referred by the High Court in December, following the Heyday case, brought by Saga.

The issue of ethnic minorities was another of the main points raised in the report. I agree wholeheartedly with what the Minister said recently: the disparities in employment among some ethnic minority groups—particularly the Bangladeshi and Pakistani communities, as the Chairman of the Committee also mentioned—are far too high. That is something on which we must make greater progress. The Minister said that he held a summit on the issue, and some suggestions were made by my hon. Friend the Member for Weston-super-Mare (John Penrose) earlier.

Benefit simplification gets a brief mention at the end of the report, although I was not hugely impressed by what the Government said about it. Benefit simplification is one of those issues on which parties can never make much progress in opposition, but there really is an opportunity to do something about it in government. We all know that the benefits manuals have grown larger and larger and that the debates on social security in the House are attended by fewer and fewer hon. Members. Why is that? Frankly, it is because even very few Members of Parliament fully understand the complexities of the benefits system. That is deeply worrying, because we cannot hold the Government to account or have sensible debates on the issue. Most importantly, the range of benefits that our constituents have to deal with causes sheer befuddlement. The National Audit Office has looked into the issue, as has the Public Accounts Committee, but much more needs to be done.

The Chairman said in his opening remarks that the new deal needed to be refreshed, and I agree with him. There is now quite a lot of statistical evidence that the results of the new deal are not as successful as they were in the past, that taxpayers are perhaps not getting the value for money that they should and that the sustainability of the scheme for ongoing employment is not there. We know that almost one third of new dealers have been on the scheme on two or more occasions and that nearly 50 per cent. of young jobseekers who leave the new deal for young people end up back on benefits within a year. We also know that 23 per cent. of those leaving new deal 25-plus in August 2006 found jobs without claiming benefits, compared with 38 per cent. in June 2001. The figures are clearly going the wrong way. I hope that the Minister and his colleagues are into evidence-based policy making, because those are quite worrying statistics.

Danny Alexander: While the hon. Gentleman is on that point, perhaps he is aware of comments made by one of the Minister’s predecessors, the former Minister for Welfare Reform, the right hon. Member for Birkenhead (Mr. Field). He recently described the performance of the new deal in relation to young people as “woeful” and drew attention to the fact that, as he claimed, there were significantly more people in the 18-to-24 age group who are out of work now than in 1998. Does the hon. Gentleman think that that reinforces his point?

Andrew Selous: That figure is correct, although it does not really matter who said it; we just need to look
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at the evidence, and I am afraid that the evidence is not good. Indeed, some of the indicators are going in the wrong direction.

The key issue is what we should do going forward. David Freud talked in his report about some payments being made by result as a possible replacement, as well as other schemes that could run alongside the new deal. That is where the focus of policy debate needs to be at the moment. There are obvious concerns about how such schemes are structured. We should ensure that they help those furthest from the labour market, who are the most difficult to help, and that they lead to sustained employment. I completely agree with the Committee Chairman and others that 13 weeks is a wholly inadequate measure for sustained employment. Who plans anything in their life for three or four months? None of us operates in such a way in our own lives. One cannot pay a mortgage on three months’ employment, and one cannot plan to pay for a holiday, plan to buy a new car or do any such thing on the basis of 13 weeks’ employment, which is not “sustained” employment under any definition that our constituents would recognise.

It is tremendously important that the payment by results models are structured so that the hardest to help are not left out. They will need a higher fee—more money will need to go to those who have been out of the labour market longest. That is probably the best proxy for the hardest to help. I am convinced that it is possible to put together a package to help all those with some of the payment by results schemes.

To take one example, an independent provider, Tomorrow’s People, is achieving a 90 per cent. rate of people staying in work for at least 13 weeks, compared with a result of only 33 per cent. under the new deal for young people and new deal 25-plus measured during the same period. There are opportunities to get a lot more people back into work on a sustained basis. That is a tremendously exciting possibility that the Committee will consider seriously.

My final point is about an issue mentioned by almost every Member who spoke this afternoon—the importance of giving the personal advisers more flexibility, treating claimants as individuals and trying to get the system to fit their circumstances rather than the other way round. We have heard a lot of figures this afternoon—we have had numbers of people, percentages and all the rest of it. I want to end my remarks by referring to two individuals, both of whom I spoke to earlier this afternoon and both of whom have given me permission to mention their cases.

The first is a Mr. Michael Hughes of Ipswich. Happily, he has a job at the moment—I am sure that we all send him our congratulations and hope that he can keep it. He had been on jobseeker’s allowance for some time. Incidentally, he asked me to say that he rated his new deal adviser as extremely good—he was very impressed and wanted no criticism of any of the individuals who had helped him. He was concerned only about the system with which they were working.

Mr. Hughes had one specific problem. He had the Institute of Certified Bookkeepers qualification and was all set and ready to get a job. There was lots of work around Ipswich that he could have got. The one thing that he needed to start work was for his indemnity to be paid. He thought that it would cost
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£250, which was too high a figure as it turned out to cost only £182. When he told his employment adviser about the problem, he was sent on a 13-week course to do a CV. The course was poorly run, I am afraid. There was very little access to computers, and he had to redo his CV time and again. He said that the course lowered the morale of the people on it. Even when his local MP tried for him, he was not able to find out the cost of sending him on that course, but I bet the Minister that it was rather more than £182. We have heard about the flexibility in New Zealand; why could Mr. Hughes not have been paid £182? He could have been in work straight away, much earlier than he was.

The other story comes from a Mr. Ian Freke of Bristol, who wrote both to me and to his local paper. His letter is in the public domain. He had been unemployed for more than a year. For the first nine months, he had not claimed JSA, but lived off his savings. He had not wanted to claim, but started to do so on 6 December 2006. He was absolutely thrilled to have been offered a job on 28 March this year. He had to start at 7 o’clock in the morning. He did not have a car, so he looked at the bus timetables. The earliest bus would not have got him to work until 7.35 am. It would have taken him an hour and 10 minutes to cycle, which the Minister would probably think unreasonable—the Minister is not responding, but I hope that he would think so. What Mr. Freke wanted was to get the job and get off JSA, so he wanted a scooter, which—on the road, taxed and ready to go—would have cost about £500. He was being paid £228 in JSA every month, so within two and a half months, the Department would have got its money back. Sadly, the job has gone. He was not able to get from the Department the means to get the work. This afternoon, I spoke to Mr. Freke, who is still out of work and claiming JSA. It will not be long before the Department will have paid out more in JSA than it would have cost to give Mr. Freke the means to get to work.

We have to give personal advisers responsibility and discretion. If they get it wrong very occasionally, so be it. There are excellent people among them, and they will get it right more often than they get it wrong. They will get it right in eight or nine cases out of 10. Of course there must be overall responsibility, limits and accountability to managers, but please, New Zealand can do it! What is the point of a Select Committee that travels the world and finds out best practice from other countries if we do not learn from it? The travel budgets that the House pays will not be worth while if Ministers of any Government do not listen to those who can tell them about best practice and what works in other parts of the world. Please, can we give the personal advisers more discretion on how they spend their budgets, which have been reduced? I hope that my two examples will give the Minister pause for thought.

5.7 pm

The Minister for Employment and Welfare Reform (Mr. Jim Murphy): Mrs. Anderson, I thank you for chairing this debate, which has been well informed. That reflects the dedication that the members of the Work and Pensions Committee, on both sides of the political divide, show to the responsibility that they have.


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