Memorandum from the Department for Work
and Pensions (CT 60)
SUMMARY
1. This memorandum is submitted by the Department
for Work and Pensions as a contribution to the Communities and
Local Government Select Committee's inquiry into coastal towns.
2. Over the last 10 years the UK has established
one of the strongest labour markets in the world. There are now
more people in work than ever before and the UK has the best combination
of employment and unemployment of any major economy.
3. Since 1997 the Government's key labour
market objective has been to achieve high and stable levels of
employment so everyone can share in growing living standards and
greater job opportunities. The aim is to give everyone the opportunity
to work and encourage those who are able to work to do so. This
will reduce the total number of people without a job and the problem
of concentrations of those without a job—whether amongst
particular groups of people or in particular areas of the country
such as in coastal towns.
4. The Department for Work and Pensions
has a Public Service Agreement target to reduce worklessness in
the areas with the poorest initial labour market position. This
target reflects the fact that the Department's policies need to
target these smaller concentrations of worklessness with resources
focused on those areas with greatest need.
5. There is no one challenge in coastal
towns and no single policy or activity to help these areas. The
best labour market policy for coastal towns is the comprehensive
support provided through Jobcentre Plus.
6. This memorandum covers the following:
— the Government's employment objectives;
— the challenge in coastal towns;
— benefit receipt in coastal towns;
— provision of Jobcentre Plus services
in coastal areas;
— future shape of the network;
— local strategic partnerships; and
— the centralising of benefit processing.
1. INTRODUCTION
1.1 The UK has one of the strongest labour
markets in the world with an employment rate that is the highest
of the major industrialised economies, and at 28.9 million there
are more people in work than ever before. Over the last 10 years,
the greatest improvements have been in those areas that were previously
furthest behind—including some coastal towns. A lot has
been achieved, but there remains more to do in order to extend
employment opportunity to all.
1.2 Raising employment in the most disadvantaged
areas is a particular priority for the Government, and is set
out as a target in the Department for Work and Pension's Public
Service Agreement (PSA). The most disadvantaged areas are predominantly
concentrated in cities (20 of the 30 lowest local authorities,
with a further five in major towns (Luton, Preston etc), although
they are also found in former industrial areas. The Government
has made significant progress in raising employment across these
most disadvantaged areas. In April 2006 the Department moved away
from a target which aimed to increase the employment rates in
the worst 30 Local Authority Districts, and instead to Spring
2008 are taking forward PSA target (4f), to increase the employment
rate in the 903 local authority wards with the poorest initial
labour market position, taking into account the economic cycle.
This aims to significantly reduce the difference between the employment
rate in these deprived wards against the overall national level.
Of the 903 wards, approximately 75 are located in coastal towns.
1.3 This revised PSA target reflects the
fact that the Department's policies need to target these smaller
concentrations of worklessness, and that resources need to be
more efficiently targeted to those areas with greatest need. The
wards were chosen on the basis of those in the 10 Local Authority
Districts with the lowest employment rates and with benefit claim
rates between 20 and 25%.
2. THE GOVERNMENT'S
EMPLOYMENT OBJECTIVES—EMPLOYMENT
OPPORTUNITY FOR
ALL
2.1 The Department's overall objectives
for the labour market are set out in the DWP Five Year Strategy[1]
and its welfare reform Green Paper (A new deal for welfare: Empowering
people to work[2]).
They are:
— to prevent poverty and provide security
for those who cannot work;
— to ensure that the system is sustainable
over the long term; and
— ensure that work is the best route
out of poverty.
2.2 The Government has also set out a long-term
aim of reaching employment equivalent to 80% of the working age
population. This will include reducing by one million the number
of people on incapacity benefits, helping 300,000 lone parents
into work, and increasing the number of older people in work by
a million. It will also require further progress to be made in
reducing inactivity and worklessness in the most deprived areas
of the UK.
3. PROGRESS SO
FAR
3.1 In the Government's first Parliament,
the priority was to tackle long-term unemployment and youth unemployment.
The New Deal for Young People and New Deal 25 Plus have been very
successful and have contributed to long-term youth unemployment
being virtually eradicated and long-term adult unemployment being
cut by almost three quarters—to just 150,000. Overall, claimant
unemployment has fallen by around 400,000 with unemployment on
the International Labour Organization (ILO) definition down by
around 600,000. Again, the most significant improvements were
in the areas previously furthest behind.
3.2 The creation of Jobcentre Plus in 2001
which brought together the Employment Service and the non-pension
parts of the Benefits Agency, has enabled the Department to extend
employment opportunities to groups previously left behind—particularly
on incapacity and lone parent benefits. Initiatives such as the
New Deal for Lone Parents and Pathways to Work have contributed
towards the increase in the lone parent employment rate by more
than 11 percentage points and the reduction in the number of lone
parents on benefits by over 200,000-777,000, while the numbers
on incapacity benefits is now falling after decades of strong
growth.
3.3 The Government will now be going further
still, as set out in the welfare reform green paper. It intends
to create a welfare system which prevents poverty and provides
security for those who cannot work while extending employment
opportunity for all those who are able to work.
3.4 In particular, the government will:
— reform Incapacity Benefit for sick
and disabled people, requiring job-related activities in return
for extra money (except for those for whom it would be unreasonable
to require them to undertake any form of work-related activity
in the foreseeable future);
— increase incentives for Lone Parents
to enter or re-enter the labour market; and
— provide more help for older workers:
improved rewards for deferral of State Pension, age legislation,
information campaign with employers, and changes that allow people
to work and draw their occupational pensions.
4. THE CHALLENGE
IN COASTAL
TOWNS
4.1 The overall context is important in
understanding the challenge in coastal towns. By far the best
labour market policy for these areas is the comprehensive support
provided through Jobcentre Plus. This includes the New Deal and
Pathways to Work, as well as targeted support in looking for and
finding work. This approach has been particularly successful in
helping the most disadvantaged areas.
4.2 There is a wide diversity of employment
rates in coastal towns—from those that are significantly
above the national average (for example Worthing, Scarborough,
the Isle of Wight) to those some way below (Great Yarmouth, Blackpool).
Given this diversity, there is clearly no one challenge in coastal
towns and no one response. The challenges are the same as those
across the country—tackling benefit dependency in the most
disadvantaged areas and breaking the inter-generational cycle
of poverty.
5. AREA BASED
PROGRAMMES
5.1 Tackling worklessness in deprived areas
means addressing multiple barriers and disadvantage. In addition
to mainstream provision, area based programmes have been developed
to offer greater flexibility of support. Action Teams for Jobs
were introduced in 2000 to increase employment among disadvantaged
groups such as homeless people and ex-offenders. Action Teams
provided an outreach service with provision that included jobsearch
advice, financial support including travel to work costs, childcare
costs as well as debt counselling and training opportunities.
By June 2006 Action Teams had helped about 174,000 people into
jobs.
5.2 The Working Neighbourhood Pilot ended
in April 2006. Early indications from the evaluation of these
pilots indicates that a more intensive and flexible approach at
local level can be effective. With the ending of Action Teams
in September 2006, the Department's future strategy will give
more flexibility of support to local areas. The Department is
reviewing how any additional resources, such as the Deprived Areas'
Fund, can best be deployed to support area based initiatives.
5.3 The Department's Cities Strategy will
in effect operate in all geographical areas and will pool resources
at a local level to allow multi-agencies and community stakeholders
to make a greater impact in tackling worklessness. The City Strategy
Pathfinders will operate from Spring 2007.
6. JOBS IN
COASTAL TOWNS
6.1 Chart 1 shows Jobcentre Plus vacancies
in 2004 and 2006. In almost every one of the coastal towns analysed,
the number of vacancies Jobcentre Plus handles has increased over
the past two years. This is in line with national trends, showing
a continued strong demand for labour from employers. With vacancies
close to record levels, in coastal towns as across the country,
a person looking for a job has a good chance of finding one.
Chart 1: Jobcentre Plus Vacancies 2004
and 2006, Coastal Towns and UK
Job Centre Plus Vacancies
6.2 There is little evidence that employment
in coastal towns is particularly concentrated in temporary or
self-employment. Chart 2 shows that nationally, just below 6%
of employees are on temporary contracts. There is some variation
between the coastal towns analysed, although this ranges from
around 3% in Poole, to 8% in Brighton and Hove. What variation
there is, is narrowly concentrated around the national average,
indicating no prevalence of temporary employment in coastal towns.
Chart 2: Proportion of Temporary Employment, 2004 and 2005, Coastal
Temporary Employment
6.3 Similarly with self employment, although
some variation between coastal towns exists (from 8% in Dover
to 17% in Hastings), variation is concentrated around the national
average of 13% of employees in self employment. In general, there
is no evidence of an over-dependence on self employment in coastal
towns.
Chart 3: Proportion Self-Employed 2000 and 2005, Coastal Towns and UK
Self Employment
6.4 As one might expect, the level and proportion
of tourism related jobs is higher in coastal towns. Overall in
the UK, the number of tourism jobs has increased by almost 250,000
since 1999, and coastal towns have on the whole benefited from
this.
Chart 4: Tourism Jobs, 1999 and 2004, Coastal Towns and UK
Number of Tourism Jobs
7. BENEFIT
RECEIPT IN
COASTAL TOWNS
7.1 Chart 5 shows that the proportion of
the Working Age population claiming out of work benefits has decreased
in all but one of the coastal towns analysed (Scarborough).
Chart 5: Benefit Receipt as a proportion
of Working Age Population in Coastal Towns, 1997 and 2006
7.2 This has been driven primarily by reductions
in the numbers of Jobseekers Allowance (JSA) recipients and Lone
Parents receiving Income Support (IS) as shown by charts 6 and
7. The proportion on JSA has fallen substantially in each one
of the coastal towns (as it has across the country). Long term
unemployment for youth and the prime aged have decreased even
further.
Chart 6: JSA Receipt as a proportion of
Working Age Population in Coastal Towns, 1997 and 2006
Chart 7: Lone Parent IS Receipt as a proportion
of Working Age Population in Coastal Towns, 1997 and 2006
7.3 There has however been a slight rise
in the proportion of sick and disabled people claiming out of
work benefit Incapacity Benefit (IB) Severe Disablement Allowance
(SDA) or Income Support (IS) through disability). Since 1997,
the overall IB caseload has increased, but stabilised and has
now started to fall over the last year. The trends shown in coastal
towns in chart 8 are similar to these national trends.
Chart 8: Sick and Disabled IB/SDA/IS Receipt
as a proportion of Working Age Population in Coastal Towns, 1997
and 2006
8. PROVISION
OF JOBCENTRE
PLUS SERVICES
IN COASTAL
AREAS
8.1 Jobcentre Plus is driven by the twin
priorities of developing new approaches to customer service and
improving efficiency. The Jobcentre Plus modernisation agenda
is based on the use of alternative delivery channels and a commitment
to tailoring support according to the specific needs of customers.
8.2 Jobcentre Plus has created a modern
service delivery model using the telephone as the preferred route
for first contact, face-to-face contact for advisory services,
and centralised Benefit Delivery Centres providing a more flexible
and specialist environment for processing claims.
Face-to-face services
8.3 The Government recognises the important
role of the Jobcentre network in providing a face-to-face service,
especially for those customers who are unable to use self-service
or telephone channels. It has invested in modern customer facing
outlets, and the rollout of new offices is now substantially complete
with only a small number of offices remaining to rollout.
8.4 Face-to-Face services are the most resource-intensive.
Although they are available to most customers through work focused
interviews and fortnightly job reviews, it is important they are
used effectively by focusing on key activities which help the
most disadvantaged customers at critical points in their job search
and support.
8.5 To enable customers to access "self-help"
services, Jobcentre Plus provides facilities similar to those
provided by banks, insurance companies and other government services
such as Tax Credits. These include jobpoints and customer access
phones, which have been located in Jobcentres to allow customers
the flexibility to search vacancies online or by telephoning Jobseeker
Direct.
8.6 Where a full Jobcentre service may not
be viable, Jobcentre Plus considers alternative, more flexible
ways to deliver those services in addition to its Internet and
telephone based services. Jobcentre Plus also offers services
in conjunction with partners and intermediaries to provide additional
support for those who require it.
Telephone and Internet services
8.7 Jobcentre Plus is also developing its
telephone and internet services. These channels provide more choice
for the customer and are more cost effective for the taxpayer.
8.8 Customers with access to a telephone
can already use the Jobcentre Plus contact centre network for
job search, National Insurance number applications and to apply
for benefits. Customers who are unable to make a claim by telephone
(either personally or through someone acting on their behalf),
can make a claim in person, by post or, if necessary, by an arranged
visit at their home or another location.
8.9 Customers can also use the internet
to search for the latest vacancies in the area of their choice
at a time that suits them: the Jobcentre Plus Internet Job Bank
is the most used public sector internet site in the UK. Information
on jobs, training and learning opportunities as well as childcare
provision and voluntary work can all also be found on the Direct
Gov website. www.direct.gov.uk.
8.10 Jobcentre Plus is keen to further develop
this self-service approach and has in 2006 introduced the piloting
of on-line benefit claims. Some customers in the North East and
South West are able to submit e-forms to initiate a claim for
Jobcentre Plus benefits. It is planned to extend this to other
regions by 2007.
9. FUTURE SHAPE
OF THE
NETWORK
9.1 Jobcentre Plus operational managers
have been asked to keep services under continual review in order
to make the most effective use of the existing estate and taking
account of access to Jobcentre Plus services through alternative
channels such as Contact Centres and E Channels.
9.2 All stakeholders likely to be affected
by the closure will be invited to provide their views on the impact
of any changes. This consultation is then considered by the Department's
Ministers who make the final decision on closure.
10. LOCAL STRATEGIC
PARTNERSHIPS, SKILLS
AND QUALIFICATIONS
10.1 In England Local Strategic Partnerships
(LSPs) have been established to tackle issues such as crime, jobs,
education, health and housing. The equivalent partnerships in
Wales and Scotland are Community First Partnerships and Local
Economic Forums respectively. These wide-ranging issues cut across
many traditional boundaries, between both individual organisations
and the public, private, voluntary and community sectors. LSPs
are central to tackling issues important to local communities
and influence the way public services and mainstream programmes
are delivered, to ensure that specific issues and those people
in most need receive a more proportionate share of the benefits
from those programmes. The principles of LSPs apply to all communities
including coastal towns.
10.2 Jobcentre Plus operational managers
work locally and regionally with LSPs and other partners such
as local authorities and Regional Development Agencies to ensure
that increasing opportunities for employment is a central element
of Local Area Agreements, Regional Economic Strategies and other
initiatives.
11. CENTRALISATION
OF BENEFIT
PROCESSING
11.1 Historically benefit processing has
been done in a large number of smaller teams in a wide range of
locations. This has not been a cost effective way of delivering
services and the Jobcentre Plus Board decided in June 2004 to
reduce the number of sites processing benefits by centralising
into larger centres.
11.2 A Project has been established to implement
this decision over the period up to March 2008. Jobcentre Plus
plans to have migrated work previously done in 650 locations to
77 larger Benefit Delivery Centres. Around 40 will be in place
in 2006-07 with the balance due in 2007-08. Current plans show
that eight of these sites are in coastal locations. Sites were
selected on the basis of availability, cost and suitability of
existing estate, optimum brigading of work and caseloads, number
of staff likely to be available and utilisation of trained staff
to help maintain performance during transition period.
12. CONCLUSION
12.1 Coastal towns vary with each other
by employment rate and labour market characteristics. There is
no one challenge of coastal towns, and no one response. Since
1997, coastal towns have benefited along with the rest of the
nation from improvements in employment rates, and reductions in
unemployment. Those areas that started in the worst position have
often experienced the biggest improvements, and this is also true
of coastal towns. It is through the government's welfare to work
programmes, and proposals for further welfare reform, that the
Government will continue to revive the local economies and labour
markets in coastal towns.
1 February 2005, The Department for Work and Pensions
Five Year Strategy: Opportunity and security throughout life,
DWP (Cm 6447). Back
2
January 2006, A new deal for welfare: Empowering people to work,
DWP (Cm 6730). Back
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