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James Purnell: We had very good interest in the bids for that. People said that companies would not bid, but they did. We are now in the phase of post-tender negotiations, so there is a limit to what I can say, but we have said in the past that we are happy to consider whether we can front-load the payments for taking people on. We have also made it clear that the contracts say that if the volumes rise by more than 40 per cent., we can reconsider the matter. There is also a break clause after 18 months, so whereas we used to give
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contracts and then come back to them at the end of the contract period, now there is much more of a relationship throughout that period. We have a mutual interest with our providers in ensuring that they deliver a good service for us. That is how we will approach the matter, and I am sure that the hon. Gentleman will find out more when we say which tenders have been selected.

As I said, the principle is that virtually everyone in the benefit system should be doing something to prepare their way back into work. We know that when people take up our support, it changes lives, but we also know that when it is voluntary, only a small proportion of people ever do so. That is why we want to increase the requirements for people to come in, take up that support and put it into practice.

Angela Watkinson (Upminster) (Con): One group of people that I do not think has yet been mentioned is young people who care for their parents with disabilities. That has quite a serious impact on their education, and they find it more difficult than other young people to get into work in the first place. Will the Secretary of State give special thought to that group?

James Purnell: That particular group is mainly the responsibility of the Department for Children, Schools and Families, with which we obviously work closely. The Bill will not make any difference to people under 18, as its measures are focused at the over-18s, but the hon. Lady makes an important point. It is important that when people reach adulthood, they should be able to make that transition. Individual budgets should be able to help with that.

Lynne Jones (Birmingham, Selly Oak) (Lab): My right hon. Friend said that when schemes are voluntary, there is less engagement. What evidence does he have that that is purely because they are voluntary, rather than because there has been a failure to engage people, a lack of communication and a lack of action on the part of the various agencies? Conversely, what evidence does he have that applying sanctions to lone parents and people with mental health conditions, for example, is successful in helping people into work?

James Purnell: Of course, we never want to impose sanctions. We want people to comply with the system, which is exactly why we asked Professor Paul Gregg to look into conditionality regimes around the world and in the UK. He found that where people are required to come in and take up support, there is lower unemployment and people are able to improve their health and get back into work. I think that that is the right approach, but it needs to be done in a personalised and sensitive way. That is exactly why the Bill will bring in a different approach.

Mr. Iain Duncan Smith (Chingford and Woodford Green) (Con): The Secretary of State mentioned conditionality, which, he knows, has pretty much fallen away under the jobseeker’s allowance, in that little happens if people do not co-operate in the sense that he means. What sort of conditionality and penalties does he envisage for those—there will be a few—who simply do not want to co-operate, and who will not co-operate?

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James Purnell: The right hon. Gentleman is right to suggest that there is an issue with the system. People can lose their benefits if they refuse a reasonable job—the Conservative party proposes to introduce that, but provision for it already exists. It is difficult to sanction someone on the basis of their doing a bad job interview, even if it is done purely to avoid going back into work. Professor Gregg recommended a quicker, clearer but escalating system, whereby people are warned, and have the reason for a potential sanction explained to them, so that the sanction is not based on misunderstanding. One can take away people’s benefits for a week or four weeks, and require them to come in to do full-time activity or things that the adviser believes will ensure that they comply with the system. We must strike a balance between ensuring that we treat people sensitively and do not cause them undue hardship, and ensuring that they carry out their obligations.

Indeed, I believe that the right hon. Gentleman, in his report from the commission on social justice, said that workless parents should have to come in for interviews and undertake preparation for work. That is the policy that we are proposing in the Bill. Unfortunately, unless the right hon. Member for Maidenhead performs a second U-turn, Conservative Front Benchers will oppose it. I therefore hope that the right hon. Gentleman will support us and have a word with his party leader, who said just before Christmas that he opposed the policy, and obviously had not read the report of the commission for social justice. We have read it and learned from the bits that we think we would work.

Mr. Davidson: The Secretary of State said that he did not feel that he could impose sanctions on people who were unsuccessful in interviews. However, he knows that some people who attend interviews make it clear to the prospective employer that they are not in the least interested in the job and that they are there only because they are obliged to come. Perhaps the Secretary of State might want to reconsider his view about never applying sanctions to people who are unsuccessful in an interview.

James Purnell: My hon. Friend makes a good point. I do not say that we should not sanction people who behave in the way he describes, but that it is hard to find out when they are doing that. When it is clear, we can take away people’s benefits.

However, my hon. Friend prompts me to deal with clause 1, which covers exactly those circumstances. It requires people to work for their benefits, and those who play the system are required to do full-time activity precisely to deter them from claiming and working at the same time, and to provide incentives for those who try to avoid their responsibilities to move into work. That is right as a deterrent and because it would teach people basic work skills, which they may have lost if they have been out of work for a long time. With the changes to sanctions and the requirement for full-time activity, the regime for jobseekers generally works pretty well.

In the past, the system has worked less well for people who are outside the JSA regime. We therefore introduced pathways and the new deal for lone parents. The Gregg review recommended that we go further and create a new category in the benefits system for those who are preparing for work. They do not have to take work
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immediately, but must prepare for their return to work at the right time. We strongly agree with that and we want to introduce it.

Mr. Russell Brown (Dumfries and Galloway) (Lab): On the work for benefit pilots, will the Secretary of State assure the House that he is not introducing workfare in this country?

James Purnell: I am happy to give that assurance. Indeed, the Gregg review covered that. Workfare is a system whereby people are punished and distanced from the labour market by removing their entitlement to work search and by stigmatising them. We propose full-time activity, supported by looking for jobs and helping people with their skills, to ensure that they get back into work rather than being distanced from the labour market.

Mr. Frank Field: How does the Secretary of State square saying that the aim is to ensure that people are not distanced from the labour market with some of our constituents, who have left school, reached the age of 25 and have never worked? Surely in those circumstances, we have a duty to provide work rather than benefit for them.

James Purnell: Indeed; that is exactly what the provisions in the Bill would enable us to do after two years. We want to ensure that we give people work at that stage, but we would require them to take it up. I saw my right hon. Friend’s proposals yesterday; I always look seriously at his suggestions. The reason that time limits have not been supported in this country is that there is a danger of establishing an arbitrary system in which people who have been on benefits through no fault of their own—for example, if they found themselves out of work in the current economic circumstances—could find that they had used up the time in which they were allowed to take up their benefits. Such individual injustices would probably undermine the argument for such a system.

Mr. Field: I was actually making the proposal in relation to people who have never worked. Also, we do have time limits for the national insurance scheme. Even people who have paid contributions for 30 or 40 years receive benefits for only a very limited period of time.

James Purnell: The system proposed in the Bill would bring in that requirement earlier—after two years—so perhaps there is not so much difference between our proposals as has been understood.

Mr. David Winnick (Walsall, North) (Lab): Will my right hon. Friend give way?

James Purnell: I want to make some progress, if I may, as I do not want to strain the patience of the House.

The new progression to work category will be about saying to people not that they have to work immediately but that they have to prepare for work. That will apply to people on employment and support allowance and to workless parents. At the moment, people on incapacity benefits have to turn up for work-focused interviews but, if they do not want to carry out the activities that they have agreed to, there is nothing that we or our
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providers can do. The Bill will change that system. People will have to come in for interviews, but they will also have to draw up an action plan and carry it out. We think that that is the right thing to do.

We will retest everyone on incapacity benefit to ensure that they are on the right benefit, and if they are not, they will go on to jobseeker’s allowance. Again, that is something that the Conservatives say should be done; we are actually doing it. We expect the vast majority of people to take up this support but, for those who do not, we think it right to have a backstop power to require people to carry out their action plans.

Mr. Winnick: Following one or two interventions that I have heard today, I wonder whether there is a danger of giving the wrong impression. There are certainly some people who claim benefit and who do not want to work; I do not dispute that for one moment. However, the large majority—I would say the overwhelming majority—of people who are unemployed and who go to jobcentres are very anxious and very keen indeed to work. That point needs to be made; otherwise, people might get the impression that we are dealing with lazy people who remain unemployed just for the fun of it.

James Purnell: That is a very good point. Indeed, the Leader of the Opposition argued recently that there were 5 million people on benefits, each of whom was a potential Karen Matthews. That is the wrong argument, because it stigmatises people, and because the vast majority of people on benefits do want to get back into work.

To match the changes that we are making to the conditionality regime for people who are sick and disabled, we will also invest more. We are spending £1 billion more on pathways to work between now and 2011, and we will also bring in the new changes recommended by David Freud—the invest to save model—so that people will be able to invest in helping people back into work and be paid back out of the benefit savings. That will cover 20 per cent. of the country, and could lead to a radical change in the system— [ Interruption. ] Opposition Members ask when that will happen. It will be from 2011, and it will happen at exactly the pace that David Freud has recommended. The Conservatives like to pretend that this is some kind of magical piggybank, but if they know of people who want to invest in these projects now, and who will do so further and faster than we are doing, they should ask them to come forward. I would be very surprised if they can find people in the City who will do that. David Freud has said that this is the right pace at which to go. Indeed, the Conservatives used to say that they liked David Freud’s proposals.

That will be the right way forward for people who are sick and disabled. We also think that it will be the right way forward for workless parents. Workless parents already have to come in for interviews, but, if they do not want to carry out their action plan, they do not have to. We believe that the vast majority want to carry out their action plan, but it should be possible for an adviser to say to those who do not that it is now time for them to do so. That will reduce child poverty, and ensure that more people get back into work.

The Conservatives are not prepared to give money to certain people. One of their main policies in this area is to increase tax credits, but not for lone parents. Another
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is to have a transferable married person’s tax allowance, which would not help single parents either. They are not prepared to give more money to single parents; nor are they prepared to help them into work. They are prepared to stigmatise, but not to help people with money, or help them get into work. I hope that the right hon. Member for Maidenhead will change her policy on that and agree with the right hon. Member for Chingford and Woodford Green (Mr. Duncan Smith).

Ms Katy Clark (North Ayrshire and Arran) (Lab): Does my right hon. Friend recognise that there is great concern, particularly about people with young children who simply may not be able to carry out the kind of work-related activity proposed in the Bill? Will he confirm that everybody’s personal circumstances will be taken into account, because in some families, it is in the interest of neither the parent nor the children to go down this path? Will the particular circumstances override the simple view that work is the most important thing?

James Purnell: The whole idea is that this is based on people’s personal circumstances, so that in tandem with their adviser they can come up with their own action plan. Instead of treating people according to the category that they are in, we want a system that treats them according to their particular ambitions and circumstances. That is precisely the idea behind this policy.

Finally, we also want to make sure that people on drugs, of whom there about a third of a million in the benefits system, do not just act as a conduit for the money to go into the pockets of drug dealers. We think that people should be able to receive support and treatment, but in return for their benefits, they should be expected, if they are drug abusers, to take up that treatment—precisely to break the cycle of crime and deprivation. The Conservative party, under the right hon. Lady’s predecessor, did not support that policy—

Mrs. May rose—

James Purnell: Perhaps we have a second U-turn; I look forward to hearing this.

Mrs. May: This is not a second U-turn. I say to the Secretary of State that we would get a lot further in the debate if, instead of making these grand claims about the position of my party, he actually looked at the facts. On 20 July last year, my predecessor, the hon. Member for Epsom and Ewell (Chris Grayling), issued a press release in which he made our position absolutely clear:

That is our position, so I would be grateful if the Secretary of State apologised for misrepresenting it.

James Purnell: Unfortunately, on 7 December the right hon. Lady’s predecessor said that he did not think that those measures would actually work. He did not know what his policy was and the right hon. Lady obviously does not. I am glad that she is going to change the position again. Two U-turns in one debate: we are getting somewhere, which we were not under her predecessor.

John Mann (Bassetlaw) (Lab): The Secretary of State is trying for the first time to define in legislation drug addiction, which the Home Office has never attempted to do, and drug treatment, which the Department of Health has never attempted to define in British legislation
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before. As with many first drafts, will my right hon. Friend give close consideration to the detail of schedule 3, and perhaps tear it up and write it again in a coherent way?

James Purnell: If my hon. Friend has some suggestions, we will be happy to look at them. We have met a few times to discuss this matter, but it is obvious from the second part of his question that we have not gone as far as he would like. He has great expertise in this area.

Jim Dobbin (Heywood and Middleton) (Lab/Co-op): Will the Secretary of State clarify whether the Bill takes account of individuals who are addicted to tranquillisers and prescription drugs? An estimated 1.5 million people have been on these agents for many years; I know one individual who has been on them for 45 years. Surely it would be cost-effective for the Government to look into helping to get these people into work.

James Purnell: I know that my hon. Friend is talking to the Department of Health about this matter. This particular provision focuses on the drugs that cause the greatest amount of crime in the system—crack cocaine and opiates—so my hon. Friend’s point is not an issue in this Bill. I know that he has pursued it elsewhere.

Lynne Jones rose—

James Purnell: I have given way many times.

Mr. Angus MacNeil (Na h-Eileanan an Iar) (SNP) rose—

James Purnell: Perhaps the hon. Gentleman would like to tell us whether the Scottish Government are going to support this policy to help people get treatment, thus reversing his party’s policy as well.

Mr. MacNeil: I wanted to help the right hon. Gentleman in a genuine feeling of mutual help and advancement rather than party political knockabout. I am aware of work going on with drug addicts in the city of Zurich and wondered whether the right hon. Gentleman has learned anything from it. If so, could he share what he has learned with the House?

James Purnell: I can tell the hon. Gentleman that we have certainly not learned from the Scottish Government, whose policy is one of opposition on ethical grounds. Our ethical position is that money should not be going from the taxpayer into the pockets of drug dealers, but should be used to help people to get better.

John Mason (Glasgow, East) (SNP) rose—

James Purnell: Perhaps we have yet another U-turn coming up.

John Mason: Does the Secretary of State accept that the Scottish Government have, in fact, been at the forefront of dealing with drugs, and that we believe, and the Scottish Government believe, that whether people receive treatment should be based on medical need rather than on whether they are on benefits?

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