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House of Commons

Monday 8 October 2007

The House met at half-past Two o’clock


[Mr. Speaker in the Chair]

Oral Answers to Questions

Work and Pensions

The Secretary of State was asked—


1. Michael Fabricant (Lichfield) (Con): What recent assessment he has made of trends in the level of worklessness among under 25-year-olds since 1997; and if he will make a statement. [156103]

9. Mr. Stephen Crabb (Preseli Pembrokeshire) (Con): What recent assessment he has made of trends in the level of worklessness among under 25-year-olds since 1997. [156111]

The Secretary of State for Work and Pensions (Mr. Peter Hain): Claimant unemployment is falling for 18 to 24-year-olds and is down 138,000 since 1997.

Michael Fabricant: Now that the red flag has been hauled down and the yellow flag of cowardice has been hoisted, what is the Secretary of State’s vision for youth unemployment, given that so many more people who have been on the new deal have gone back on to jobseeker’s allowance?

Mr. Hain: The truth is that, compared with when the Tories were in power, when young people had virtually no chance of getting a job in constituencies such as mine, unemployment has been cut, youth unemployment has been cut and long-term unemployment—more than a year—has been virtually eradicated. That is a record of which we are proud, and the new deal for young people has made an enormous contribution to that—a new deal opposed by the Conservatives.

Mr. Crabb: The number of young people leaving the new deal to go straight back to benefits has spiralled in recent years and the number of 18 to 20-year-olds not in education, employment or full-time training has increased sharply. Does not that show that the claim that youth unemployment has been virtually eradicated is nonsense and that, despite all the billions of pounds of expenditure on the new deal in the past five years, we still have a serious and growing problem with a hard core of unskilled, unmotivated young people who are effectively doing nothing with their lives?

Mr. Hain: In the hon. Gentleman’s constituency, long-term, six month-plus youth unemployment has fallen by 94 per cent. since we came to power. I can give him lots of other figures, including about the very high number of vacancies in his constituency. There are plenty of jobs in his constituency, and that is true right across the country. Yes, there is an issue about 16 to 17-year-olds, which we are addressing, but it would not be addressed by the bankrupt policies of the Conservatives.

Chris Ruane (Vale of Clwyd) (Lab): What role does my right hon. Friend think city strategies can have in tackling worklessness among the under-25s?

Mr. Hain: Those strategies can have an enormous role, and I congratulate my hon. Friend on chairing the city strategy project in Rhyl, which has got off to a flying start. He has brought together local employers and all the other agencies. The strategies are focused on tackling some of the problems right at the centre of our towns and cities that are still very serious and part of a legacy that we inherited 10 years ago. We are doing something about it.

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Mike Penning (Hemel Hempstead) (Con): The hon. Member for Vale of Clwyd (Chris Ruane) is doing something about it.

Mr. Hain: My hon. Friend is indeed doing something about it, and I am glad that the hon. Gentleman is joining me in congratulating him on what he is doing in Rhyl to tackle some of the serious problems of people who are also involved in drugs and other problems in some of our most disadvantaged areas. In Rhyl, people are showing the way forward, and we will all need to consider whether that model can be applied elsewhere.

Mr. Frank Field (Birkenhead) (Lab): Given that, during the past three years, 2 million people have come to this country to work and have found work, does my right hon. Friend not feel that our welfare-to-work strategy is somewhat disappointing? Given that we are not now to have an election, might we have a debate in Government time on the new proposals that he intends to introduce to help and encourage more people to move from benefit to work?

Mr. Hain: As my right hon. Friend knows, we are consulting, including with him, on how we take on the next stage of getting more people into work. The truth is that we have been incredibly successful in the past 10 years in tackling the main problem of those who are in and around the job market, with 2.7 million extra jobs in the past 10 years, about 800,000 of which involve those who have come from outside the country to work in Britain and are contributing to our economy. However, there is still a high level of people on long-term benefits, which we intend to tackle. That is why we published our Green Paper, “In work, better off: next steps to full employment”, and I will certainly work with my right hon. Friend and anyone else who has ideas to contribute during the consultation that ends at the end of this month.

Chris Grayling (Epsom and Ewell) (Con): I welcome the Secretary of State back from the campaign trail. I have been wondering over the weekend whether he is one of the Cabinet’s young Turks or grey beards.

The Secretary of State talks about youth unemployment. According to the Office for National Statistics, overall youth unemployment is almost 50,000 higher than it was when the Government came to office. Does he accept that situation?

Mr. Hain: As the Secretary of State responsible for the grey citizens in this country, I take pride in that role. Furthermore, when we look at our record on youth unemployment compared with what we inherited in 1997, we see the truth: the rates of both claimant and International Labour Organisation youth unemployment have fallen since 1997. The new deal for young people has reduced total and long-term youth unemployment and virtually eradicated long-term claimant unemployment—those claiming for a year or more. Those figures have gone down by 90 per cent. since 1997.

Despite the continual attacks on the new deal for young people, independent assessment has shown that the total number claming jobseeker’s allowance for more than six months would have been twice as high as it is now. That is all a result of our achievements, but we have got to do more—and we will do more.

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Chris Grayling: I find it baffling when the Secretary of State talks about his achievements. According to the Office for National Statistics, the unemployment rate among 16 to 24-year-olds was 14.1 per cent. in 1997; today it is 14.5 per cent., and nearly 50,000 more young people are unemployed. When the Secretary of State said to this House,

was he telling the truth?

Mr. Hain: I repeat to the hon. Gentleman the point that I have already repeated: long-term youth unemployment—those on the claimant count for more than a year—has been virtually eradicated. That is a fact. He can check the statistics with me; I am happy to exchange correspondence with him on the issue. The truth is that we have a good record on increasing the number of jobs for young people. We continue to do so. However, there are more young people in the under-25 age group in the labour market now. That accounts for some of the points made by the hon. Gentleman, but he should check his figures.

Mr. Barry Sheerman (Huddersfield) (Lab/Co-op): Does my right hon. Friend agree that there is still a problem that we must resolve? Will he look at some of the exciting pilots that depend on intensive mentoring? There is one in east London and we are starting one in Huddersfield. Jobcentre Plus and bureaucracies such as learning and skills councils often get in the way of such pilots. Will he visit some of those interesting pilots?

Mr. Hain: I am certainly happy to look into those projects. Yes, there is a whole issue about mentoring. The question is not only about getting young people into jobs, but about keeping them in those jobs; that is where mentoring comes in. Such mentoring is important for all sorts of categories of people who have been on long-term benefits, as it makes sure that they sustain their employment. When mentoring is applied, such people often do so.


2. David Tredinnick (Bosworth) (Con): How many complaints he has received on the administration of pensions in 2007. [156104]

The Minister for Pensions Reform (Mr. Mike O'Brien): Most individual complaints would be dealt with by pensions centres or the Pension Service chief executive. In respect of occupational pension schemes, complaints would be dealt with by internal procedures or the pensions ombudsman. It follows that few complaints would go to the Secretary of State; the Department does not therefore take account of the figure.

David Tredinnick: I am disappointed to hear that reply. When the Prime Minister was Chancellor, he was responsible for complicating occupational pension schemes to such an extent that many of them were shut down by the trustees.

On another point, will the hon. and learned Gentleman explain why the unclaimed assets fund is being used only for youth projects? None of that money is going towards helping those pensioners who suffered so much through the failure of the schemes.

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Mr. O'Brien: Last week, the Conservative party claimed that unclaimed assets could be used—in pension and other funds, as far as I am aware—to make payments and refloat the lifeboat that was sunk in July by the report issued by the Government Actuary, Andrew Young. That report clearly stated that

Sir John Butterfill (Bournemouth, West) (Con): Does the hon. and learned Gentleman agree that there is a real problem in recruiting trustees for the administration of private pensions? That is partly due to the requirements put on pension funds by the regulator. For example, there is now a requirement for trustees to become professionally qualified. That has been difficult. In the case of our own scheme, which I have the honour to chair, all our trustees took the Pensions Management Institute examinations. However, it is proving increasingly difficult for other schemes to recruit people to become trustees given both the potential liabilities that they face and the requirement for additional learning. Before, it was considered sufficient for them to take appropriate professional advice.

Mr. O'Brien: As it happens, I met the regulator this morning and discussed this very point with the chairman and the chief executive. There is concern about the level of qualifications that it appears that some trustees are obliged to achieve. As part of the deregulatory review, I want to look at the issue. I am not sure that the statute is the problem—it is more the guidance that seems to be given. As a result of the review, I hope that we will be able to make it much clearer that the level of competence required of trustees consists of a reasonable knowledge, plus common sense, and that we will not deter large numbers of people from becoming trustees at a time when we need them. The hon. Gentleman’s point is well made.

Mr. John Redwood (Wokingham) (Con): How many complaints does the Minister know about concerning the very large sums of money taken out of funds each year under the tax policy of the previous Chancellor of the Exchequer, and the ineffectiveness of the regulator to resist those demands?

Mr. O'Brien: Of course, the regulator’s aim is to ensure that we have a stable and effective pensions scheme. By and large in recent years, since the office of the regulator has been established, it has gained credibility and increased confidence in the pensions industry. As a result of the creation of the regulator, we have a pensions industry that is much stronger than it was.

New Deal

3. Keith Vaz (Leicester, East) (Lab): What plans he has to visit Leicester to discuss the new deal. [156105]

The Secretary of State for Work and Pensions (Mr. Peter Hain): More than 1.8 million people have been helped into work through the new deal programme, including 11,790 people in Leicester, of whom 3,330 people are in my right hon. Friend’s constituency, which I have of course visited at his invitation before.

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Keith Vaz: I thank the Secretary of State for that answer and ask him to visit again—so successful was his last visit. When he comes to Leicester, will he come with me to visit a community-based scheme called Business-to-Business, which over the past few years has helped hundreds, if not thousands, of people into work as part of the new deal arrangement? Does he agree that that is the basis of the new deal—enabling people from diverse backgrounds to get into full-time work so that they can help to sustain the wonderful British economy that we have at the moment?

Mr. Hain: I acknowledge the important role that Business-to-Business has played, especially in tackling a problem that is close to my right hon. Friend’s heart: the difficulties faced by ethnic minority communities, particularly in city and town centres. That remains a big challenge for us and it is one of the outstanding issues that we need to address. I also welcome the fact that Leicester is one of our city strategy pathfinders, tasked with improving local employment rates. I know that my right hon. Friend has been invited to the launch on 19 October.

Mr. Ian Davidson (Glasgow, South-West) (Lab/Co-op): Once the Minister has visited Leicester, will he continue travelling north and visit my constituency, where in the last year to date unemployment has fallen by 16.2 per cent.? That is welcome, but does he agree that it is not good enough and that areas such as mine ought to be made targets for zero unemployment? That is entirely possible in an area such as mine, where the number of jobs coming in is greater than the number of unemployed. However, priority needs to be given to people locally who are unemployed. Will he agree to direct the Department accordingly?

Mr. Hain: Yes.

Mr. Davidson: Thank you!

Mr. Hain: I will certainly see what I can do about my travels. I did not respond directly to the request made by my right hon. Friend the Member for Leicester, East (Keith Vaz) about visiting Leicester. We will look into the matter. I know that my hon. and learned Friend the Minister for Pensions Reform is due to visit Leicester soon. Perhaps he can accompany my right hon. Friend to a project such as the one he mentioned.

I was in Scotland a few weeks ago and what struck me was the way in which, over the past 10 years under a Labour Government, the economy has been transformed. There are more jobs than ever before and, in areas including the constituency of my hon. Friend the Member for Glasgow, South-West (Mr. Davidson), we are beginning to tackle successfully some of the deep-rooted and deep-seated problems of people who have been on benefits year after year as a result of the Tories’ miserable failure throughout the United Kingdom, and especially in Scotland, when they were in government.

Child Poverty

4. Mr. Stewart Jackson (Peterborough) (Con): What his latest assessment is of the trends in levels of child poverty. [156106]

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The Minister for Employment and Welfare Reform (Caroline Flint): We have succeeded in arresting and reversing a historical upward trend in child poverty, which led to its doubling under successive Conservative Governments. Since 1997, Government policies have lifted 600,000 children out of relative poverty, with fewer children living in workless households and increases in lone parent employment.

Mr. Jackson: In his plagiarised speech at the Labour conference, the Prime Minister said that the

How does the Minister reconcile those remarks with the fact that, according to figures from March this year, the number of children in poverty has risen by 200,000 to 3.8 million, after 10 years of a Labour Government? We still have the highest number of children living in workless households in the whole of Europe. What about rhetoric and reality?

Caroline Flint: One thing that is for sure is that in 1997 we had the worst record in Europe, and today, although there is more to be done, we are recognised as having the greatest improvement of any European Union country. Since 1997, over 2 million more people are in work, and unemployment is close to its lowest levels since 1975. Of course we have to do more, but the difference between today and 1997, when we came to power, is that then there had been 20 years of an increasing trend of child poverty. That trend upwards has been halted. We do not believe that the latest figures represent a trend in the wrong direction, but our Green Paper asks important questions: what more can we do to provide work for those who currently do not have it, and to make work pay?

Kali Mountford (Colne Valley) (Lab): Is not persistent inter-generational worklessness at the heart of the problem? What more can be done to ensure that people who stay out of work continually, from one generation to another, and who have that as the norm, can be signposted, so that we make sure that they take part in this new generation of work and do not stay out of society?

Caroline Flint: My hon. Friend makes an important point. The saddest thing to hear from staff working in our jobcentres is that they are dealing with the son of someone whom they dealt with 20 years ago. Breaking the cycle of inter-generational unemployment is a huge challenge, and there are no quick-fix solutions. Our ambition must be that when children look out of the window of a morning, they see a community on its way to work. We have to make sure that we provide the means, the resources and the expectations if that is to happen.

Mr. Robert Goodwill (Scarborough and Whitby) (Con): As we currently measure relative poverty, the only way to reduce child poverty is to increase pensioner poverty, and vice versa. Has the Minister looked at more realistic ways of measuring actual poverty, so that we can have a more sensible debate about the subject?

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