Examination of Witnesses (Questions 20-39)
DEPARTMENT FOR
WORK AND
PENSIONS, JOBCENTRE
PLUS & LEARNING
AND SKILLS
COUNCIL
WEDNESDAY 24 OCTOBER
2007
Q20 Mr Dunne: I have one last question
in relation to working together which you referred to Sir Leigh;
on page 9, paragraph 15, the NAO Report emphasises the importance
of effective partnership working. With the reorganisations that
have taken place within the Learning and Skills Council, with
the Jobcentre Plus office closures meaning that the concentration
of offices and people available to do these work-focused interviews
is now concentrated in the metropolitan areas, by and large, and
there are far fewer people available in rural areas—and
we have discussed this before—and with the regional development
agencies taking on increasingly the job-broking functions through
Business Link and so on, how are the reorganisations affecting
effectiveness and how are you pulling all these strands together?
Sir Leigh Lewis: I will ask Mark
Haysom to comment in a moment from his perspective and then Lesley
Strathie may want to add something. Nothing is ever perfect and
I am not going to sit here, and nor are my colleagues, and tell
you that everything is perfect in the best of all possible worlds
in terms of partnership working and co-operation. What I would
say—and I hear it frequently both at national level but
much more importantly because I make a point of trying to go out
and see on the ground for myself very frequently—is I hear
at local level an awful lot of people, my staff but also partner
organisations, saying that co-operation on the ground is better
than it has ever been, but let me put that to Mark Haysom and
Lesley.
Mr Haysom: I would echo that.
Q21 Chairman: Can I say generally
in this Committee I think it is a bad idea if one person answers
a question and then passes it to a colleague because my colleagues
are time-limited and it just delays things, so in future would
you let Mr Haysom answer first.
Mr Haysom: I would like to echo
what Leigh has just said. My experience is that over the last
couple of years working on the ground has moved on pretty dramatically.
I would like to think that the re-organisation that the Learning
and Skills Council went through last year, which you will recall
I spoke about at a previous occasion, has contributed very significantly
to that because we are now able to partner at the appropriate
level, so we have local partnership teams at local authority level
and they can match in very easily with local authorities and Jobcentre
Plus and so on. I think that there has been a big step forward
and I think that is seen through a lot of the work of Strategic
Partnerships and indeed of the City Strategies, as Leigh has mentioned
earlier.
Chairman: Thank you very much. Austin
Mitchell?
Q22 Mr Mitchell: It is a funny kind
of business that you are in in the sense that it seems the more
effort the less the return.
Sir Leigh Lewis: Can I just ask
you unpack that for me before I plunge in and the Chairman stops
me. Just unpack that for me so I am trying to answer the key point.
Q23 Mr Mitchell: The Government is
constantly preaching this new initiative, that new initiative,
this new drive to get all these people who really want to work
but are actually sitting at home back to work, and yet all the
figures show the more we spend on that and the more effort we
put in it is a diminishing return.
Sir Leigh Lewis: I do not think
I would go there. It is an ultimate truth that if the Department
for Work and Pensions, at least on the work side, had every single
person in this country in work, then the need for our services
would be dramatically less, if you see what I mean.
Q24 Mr Mitchell: If we run the economy
at full tilt we will have a better chance of putting all these
people back to work than if you devote all this money and all
this effort to patchwork schemes.
Sir Leigh Lewis: I do not think
that is fair or the case.
Q25 Mr Mitchell: That was the situation
in the 1950s, was it not?
Sir Leigh Lewis: I will not go
back that far.
Mr Mitchell: Well I do!
Mr Bacon: And do we not know it!
Sir Leigh Lewis: I was alive then
but I do not think I was concentrating on employment programmes.
I do not think we are seeing a law of diminishing returns. What
I would say is this however: if you look for example at unemployment,
it is dramatically lower than it was in recent memory, in our
memories if you see what I mean, and it is certainly the case
that the people that we are seeking to help now, by and large,
have more barriers and barriers which are deeper to their return
to work than was the case when there were many, many more people
in absolute numbers outside of the labour market, and that does
mean that it is harder to help those individuals but it is also
more worthwhile.
Q26 Mr Mitchell: Some of what you
have done at least is due to the fall in unemployment. The total
number of workless households has fallen from 3.5 million to three
million, which is presumably a function of the rise in employment
because there are more people in work than there were, but the
number of workless households that are economically inactive has
hardly changed at all.
Sir Leigh Lewis: Actually I think
there there is a success story to tell as well. If you look at
the total number of workless households in the last ten years,
it has fallen by 200,000 while at the same time the total number
of households has increased by 850,000 so the proportion, just
as a piece of mathematics, has fallen from around 18% to around
16%.
Q27 Mr Mitchell: But 18% of workless
households is still what it was.
Sir Leigh Lewis: Yes, and that
shows that this is challenging and difficult but nevertheless
that is why I come back—and it may be a theme this afternoon—there
is a half-full bottle here and there is a half-empty bottle.
Q28 Mr Mitchell: It does show you
that you are approaching an irreducible minimum that no matter
how much effort you put in and how much money you spend you are
not going to get it much lower.
Sir Leigh Lewis: I do not believe
that. If you take people claiming incapacity benefits, I think
we are now at 2.66 million. We have seen that number peak and
come down by 120,000 in the last two to three years. Actually,
in historic terms, that is still a high number and none of us
here believes that we are yet at some irreducible level, not remotely
so.
Q29 Mr Mitchell: I see in 1.10 that
they seem to be households where all the problems compound. They
face multiple disadvantages—low skills, poor health and
living in social housing (social housing, incidentally, where
we are going to offer them the chance of buying their share of
the house on benefit which they will not be able to do, but that
is just a passing aside). Here the kind of gateway lectures on
what is available are not going to be much use in households like
that.
Sir Leigh Lewis: If that was all
we were doing I would agree with you, but it is absolutely not
all we are doing. If you take the Pathways to Work programme,
for example, which is focused on people claiming incapacity benefits
(who are a group who have overall and on average a tougher set
of barriers) it is much more than simply conversations and the
offer of support. It includes, for example, the condition management
programme, extensive on-going support in terms of health conditions,
in terms of mental health problems, in terms of physical health
problems, and it is that which I think is showing that those interventions
do work. While they are tough and hard to do and while they can
be expensive, the payback can also be very, very substantial,
because if you can take someone off a benefit which would otherwise
be a very long-term benefit for them, then you really are changing
that person's life as well as putting a financial—
Q30 Mr Mitchell: The effort you have
to put in is higher in areas that already have high unemployment.
There are parts of the country where if you are disabled or if
there is some other disincentive to work, it really just is not
worthwhile the effort to look for a job because there are not
any.
Sir Leigh Lewis: I would not go
there and I would not accept that. Today there are about two-thirds
of a million job vacancies and those are simply the ones that
are on Jobcentre Plus's books. There are jobs every day, everywhere.
If you go into any one of Lesley Strathie's 850 Jobcentre Plus
offices today, there are jobs, there are lots of jobs and jobs
turn over continually. I am not saying that in every part of the
country the employment position is utterly perfect, of course
it is not, but there are jobs and there are jobs being taken and
filled every day. Our job is to help some of those people, who
left to themselves would struggle to get those jobs, to get them.
Q31 Mr Mitchell: People tell me,
this is Grimsby and it is particularly true I think of single
parent families, that women actually want to get in work, they
are motivated, they want to get away from that blasted kid and
have some attachment to the real world, but they just cannot find
anything, and that must be a widespread situation.
Sir Leigh Lewis: Ten years ago
we had more than one million lone parents claiming income support
as lone parents. Today it is around three-quarters of a million,
so there has been a huge—
Q32 Mr Mitchell: Your gateway where
you motivate people and you tell them what is available and stimulate
them, does that work better in areas of high unemployment than
it works in areas of low unemployment? Do you have figures on
that?
Sir Leigh Lewis: We do not have
figures immediately to hand. I think it must intuitively be the
case that in areas where jobs are extremely plentiful then it
must be easier to help people because there will be a wider range
of jobs but, just to repeat, there are jobs available today everywhere.
That does not mean there is every job that anyone might want everywhere
but there are jobs available everywhere today. [2]
Q33 Mr Mitchell: I wish you could give
us some figures on the regional variations because it is interesting
and it does affect your work, I would have thought, substantially.
Sir Leigh Lewis: Indeed.
Q34 Mr Mitchell: In passing, another
issue which is not dealt with in the Report—and it might
be a bit heretical to talk about it—is large-scale immigration,
as we now seem to have from Eastern Europe. That is going to damage
the prospect of getting these kind of people that you are dealing
with back into work because the jobs are going to be filled by
strapping great Poles.
Sir Leigh Lewis: I am tempted
to say that takes you into an area which is a bit beyond this
Report perhaps—
Q35 Mr Mitchell: Yes, but it does
make employment more difficult.
Sir Leigh Lewis: But that is something
that our labour market economists in the Department will occasionally
refer to—and I hope you will not take this in any disparaging
way—as the lump of labour fallacy. That suggests that the
number of jobs is a given and it will always be a given and will
actually stay there. That is not the evidence of what actually
happens because people create jobs. Once people are here, we all
of us then need services and goods and that in turn creates demand
and creates jobs.
Q36 Mr Mitchell: Okay, I accept that
point. Would it not be easier instead of spending all this money
on motivation and the efforts you are putting in if you just subsidised
jobs for the disabled?
Sir Leigh Lewis: No I do not think
it would and I think there is long experience of job subsidies
from successive administrations going back many years.
Q37 Mr Mitchell: We do subsidise
them already with the working families tax credit. We subsidise
low pay.
Sir Leigh Lewis: That is a different
thing, if I may say so. That is helping in a sense individuals
to ensure that work pays for them. I think pure job subsidies—and
I remember when I was a young civil servant in the then Department
of Employment that there were job subsidies—tend not to
be very effective.
Q38 Mr Mitchell: Give us a reflection,
there is a perennial argument, and in the States they have gone
one way which is actually to cut off benefit and hopefully force
people back to work, a practice which has been much praised among
Conservative politicians. What works best, the carrot or the stick?
You are wielding carrots, are you not; would you want a stick?
Sir Leigh Lewis: I do not want
to use that terminology, please, because I will be quoted as having
used it and I do not want to do that. Actually there are two sides
to this coin and that is what we are trying to do. One is to offer
more support than we have ever offered before. Let us not depress
ourselves this afternoon. There is quote after quote in the Report—and
I do not want to bore you and incur the wrath of the Chairman
by reading them—which say that what we are doing is genuinely
successful. We are offering more support than we have ever done
in the past. Along with that goes a responsibility to accept that
support and that is the thrust of Government policy.
Q39 Mr Mitchell: It says at paragraph
5.10 that some of the programmes are not particularly successful,
and it instances the New Deal for Partners, which we have already
talked about, the New Deal 25 Plus and the New Deal for Young
People, where entry rates have been declining or stable for many
years. Those programmes therefore must be unsuccessful so why
not cut them and devote the money to other programmes?
Sir Leigh Lewis: Because I think
it goes to the heart of one of the earlier questions you asked.
If we were genuinely to believe that we had reached a sort of
point where we were at an irreducible minimum and that the numbers
who were left outside the labour market could not effectively
be changed, then I think there would be some real point in that,
but none of us believes that to be true. We believe that we are
still having a real impact. Could I, Chairman, with your indulgence,
just correct one answer that I inadvertently gave when I said
there were two-thirds of a million vacancies with Jobcentre Plus.
If fact, that is the total number of vacancies, not just those
that are with Jobcentre Plus. My apologies for misleading the
Committee.
2 Ev 15 Back
| 
