---

Lord Higgins: My Lords, the House is grateful to the Minister for explaining the two regulations and I agree that it is convenient to speak to them both together.

The regulations extend the jobseeker principle introduced by the last Conservative government; and if one can encourage employment in an efficient way, it is to be welcomed. However, I feel bound to point out that when the previous legislation in the last Parliament was going through the House, it was viciously attacked by Miss Angela Eagle who is now the Under-Secretary of State for Social Security. It will be interesting to know what comments she will make on these orders when they appear in another place.

In fact, the jobseeker principle was a success--so much so, that the Government were committed to introducing a plan to deal with the young unemployed; and by July 1997, when they got round to announcing their New Deal policy, only around 125,000 were still in that position. The department was also remarkably successful in hanging on to the money which the Chancellor had intended it should have for this purpose. It is now using it to extend the principle to the over-25s. Can the Minister tell us what proportion of the total budget--I believe it is £5 billion over the life of the Parliament--is to be spent on the under-25s and what proportion is expected to be spent on the over-25s?

Of course, the situation may change with the falling rate of growth which the Chancellor of the Exchequer is now envisaging. That may have important implications also for employment. In his pre-Budget Statement the Chancellor said,

"Already, 29,000 companies have signed up to the New Deal and 30,000 have found jobs with employers, jobs they would not have had without the New Deal".

How does the Chancellor know that that is so? We need an answer to that because we cannot have the Chancellor of the Exchequer making these remarkable statements if there is no basis for them.

I turn to the first of the two sets of regulations, the ones concerned with refugees and those persons given exceptional leave to enter or remain in the United Kingdom on humanitarian grounds. It must be the case that it is beneficial if those who are granted asylum in this country are able to find jobs rather than being a burden on the taxpayer. We welcome that. But I should like to raise one point in that context. The regulations specifically refer to whether or not they are on income support. The period they are on income support counts towards the qualifying period. But a recent view expressed by various outside groups referred to the non-cash system of support for accommodation provided on a no-choice basis. Can the Minister say--I genuinely do not know the answer--whether those who are in the position of seeking asylum or have been granted permission to enter or stay are always on income support? It may be that they are supported in some way other than the narrow definition of "income support". If so, will they still qualify in the way the Government intend or what is the situation in that regard?

13 Nov 1998 : Column 937

I am slightly surprised that the order was introduced, though its intention is clearly admirable. How many refugees and others are expected to be affected and what, if any, will the cost to the Exchequer be? One would have thought it was a relatively small number of people and clearly we need to obtain some idea of scale in relation to this specific order.

I turn to the second order relating to the Social Security (New Deal Pilot) Regulations. Although the jobseekers' system worked well, the reality is that the efficiency of the New Deal is open to question. Indeed, the pilot schemes previously introduced were extremely disappointing. Regardless of that, the Government have pressed ahead; for example, with regard to the New Deal for lone parents: so much so that it looks as though the Government now require, under the new "Gateway" system, compulsion from those who would not otherwise respond to invitations to go for an interview.

I must make one point at this stage. Over three decades or so I have seen a lot of statutory instruments, some better drafted than others. But this one is about the worst drafted one I have seen for a long time. Indeed, at one stage in the preamble the draftsman seems to resort to the wording used for the introduction of new Members into your Lordships' House. It reads,

"and of all other powers enabling each of them in that behalf",

and so forth. It seems to be an extremely desperate form of drafting. But what is clear is that it is intended to be an experiment and perhaps the Minister can tell us what criteria are to be used for determining whether or not the experiment has been a success and whether it should be continued and extended beyond the various areas specified in Schedule 1.

Having said all that, I hope that we obtain answers to my questions. Up till now the experiments have not been successful and if we are to engage in a further extension of the scheme, it is important to have some idea of the basis on which we will determine whether or not to go ahead with what is in fact, as a means of encouraging employment, on the face of it a very inefficient way of dealing with the problem. Other than that my points were largely technical.

Can the Minister say whether there is to be a leaflet produced for those affected by this scheme which will explain to them, in words other than those employed in the statutory instrument, what the situation will be in regard to them applying for arrangements under the regulations?

1.30 p.m.

Earl Russell: My Lords, I should like to thank the Minister for the elegant way he introduced these regulations and for reminding us that Dr. Pangloss is alive and well and living in Whitehall. I should like to associate myself with two of the questions posed by the noble Lord, Lord Higgins. The first concerns the people who have found new jobs because of welfare-to-work. Can the Minister tell us how the Chancellor of the Exchequer knows about that? The second concerns asylum seekers whose eligibility depends on receipt of income support, which is about to be taken away.

13 Nov 1998 : Column 938

I cannot help wondering whether no one had programmed the office computer with forthcoming changes. Indeed, these things have been known to happen.

I sympathise with the noble Lord, Lord Higgins, as regards the drafting, but I have seen worse. Fortunately, I have been very expertly advised on these regulations. Perhaps I may draw attention to one point in the drafting as regards Regulation 1(2) of the New Deal regulations which says:

"These Regulations shall cease to have effect on 29th November 1999, unless revoked with effect from an earlier date".

First, that is an example of the redundant words so regularly deplored by the noble and learned Lord, Lord Simon of Glaisdale. The Secretary of State can always revoke regulations whenever he feels like it. Secondly, it indicates a more than usual awareness of the uncertainty principle of politics. When the Minister replies, perhaps he could give us some indication of why the uncertainty in this area is so intense.

I am afraid that I have some moderately far-reaching questions about the regulations. On 4th November, the Department for Education and Employment said that in extending the New Deal to over 25s,

"we will be insisting on the same high quality standards and monitoring as we have been for the New Deal for the young unemployed".

When he considers that question carefully, I wonder whether the Minister might think that those words have been just a little economical with the truth. This relates to two points. One is the use of sanctions and the other is the issue of the quality.

We should look, first, at exactly what the manifesto said about sanctions. Those words apply to the under-25s and the under-25s alone. The exact words of the manifesto were:

"Rights and responsibilities must go hand in hand, without a fifth option of life on full benefit".

There is a very significant difference between those words and the words of Tony Blair's Amsterdam speech of February 1997. Tony Blair's words were:

"There is no option of a life on benefit".

That was changed in the manifesto to the words,

"a life on full benefit".

During the election, I remembered doing a radio interview on a particularly obscure radio station. I sat opposite Mr. Chris Smith who was then Opposition spokesman on social security. I said to him that I would love to be a fly on the wall at the moment when that drafting amendment was agreed. Of course, he treated that as an off-the-wall comment, as, indeed, he would. I also said that I had some interest in the question of whether the wording of Mr. Tony Blair or that of the manifesto would be applied.

It turns out in fact to be the wording of the Amsterdam speech and not the wording of the manifesto on which the Government have consistently acted. I say that because total disentitlement to benefit is not sanctioned by the manifesto, although Ministers consistently confuse the two--most notably in Mr. Donald Dewar's recent reply to the objection to

13 Nov 1998 : Column 939

compulsion in the report of the Scottish Select Committee. Mr. Andrew Smith, again on 4th November, said in a DfEE news bulletin:

"Unwarranted refusal will lead to loss of benefits".

It is not quite as clear an example of confusion as that from Mr. Dewar, but it is very definitely in the same ministerial family.

In the light of that question, I should like the Minister to clarify the following points. First, what is the relationship to the manifesto of the extension of sanctions to the over-25s; and, secondly, are these sanctions for the over-25s total or partial? If they are partial, can the noble say in which proportions?

This must have been a fairly recent change of outlook. If we look at the Secretary of State's Answer to my honourable friend Mr. Keetch during Question Time on 9th July, it will be seen that he said:

"Attending for interview is compulsory, but taking one of the options available ... is not".--[Official Report, Commons, 9/7/98; col. 1223.]

Can the Minister tell us when the Secretary of State changed his mind between 9th July and today, and what reasons led him to make that change? This is a matter of some legitimate interest. I believe that the difference between those words is particularly clear.

The issue of quality depends largely on the question of cost. I will accept what the noble Baroness, Lady Hayman, told me during the debate on the Statement on the Utting report. It was said in a slightly different context, but the point is the same. She said that the relationship between cost and quality is not exactly a constant. However, the fact that there is such a relationship is, I hope, something that the Minister will not consider denying.

For the 18-to-24 age group the average cost of the employment option is £2,000 per person. For the other three categories, the average cost of those options is £4,000 per person. However, in the specification document for the pilots as regards this option for the over-25s the average cost is £1,300 per person. It may be possible, by a quite remarkable exercise of what Whitehall misleadingly describes as efficiency, for quality to be kept up even with that dramatic reduction in costs. But if that is possible, it would need a rather good explanation. I look forward to hearing the Minister provide it.

There is also a question about the length of time for which training is available. As far as I can understand--I believe the Minister's mention of 13 weeks probably tended to confirm my view--there is no guarantee of training being available beyond 13 weeks. Indeed, we have been advised that training may under this option last as little as one day. I very much hope that the Minister can assure me that that is a mistaken view.

The Minister also talked about learning lessons from the welfare-to-work projects applied to the 18-to-24 age group. That is well worth considering. We were told that the gateway should not last beyond four months, yet 20 per cent. of those on the under-25s pilots who went into the gateway in January were still there in August. As anyone who drives around London will know, gateways tend to involve traffic jams.

13 Nov 1998 : Column 940

There is also a good deal of thought to be given to the question of sanctions. Here again I refer to the DfEE news bulletin of 4th November which has some points to make in that respect. It makes mention of the categories of sanction and this information comes again from Mr. Smith. The categories were listed as follows:

"Failure to attend an adviser interview--623;

Failing to take up a New Deal Option--112;

Refusal to take up employment--45;

Leaving employment voluntarily--237;

Failure to attend an employment programme--82; [and]

Number of other reasons, including failure to attend training--253".

Mr. Andrew Smith describes the latter straightforwardly as "abusing the system". I would not for a moment dispute that some of those are leaving the system. However, let us take just one example: the case of voluntarily leaving employment. There have been cases of people found guilty of voluntarily leaving employment in situations where I believe that either the Minister or I--and I believe that both of us are honourable people--would have done the same. Take, for example, a case in Cheshire of a man aged 60 suffering from severe angina whose work involved the lifting of heavy packing cases. He was advised by medical personnel that he could not expect to live if he remained in that job. He left it. He was found guilty of voluntary unemployment and deprived of benefit--as the noble Baroness, Lady Hollis of Heigham, so memorably stressed in the previous parliament--before appeal.

If the Government are learning the lessons of these pilots, I hope they will consider the effect of disentitling people to benefit--possibly mistakenly--before appeal. I ask the Minister the question I asked the previous government; namely, why is it that a single, able-bodied person cannot be in hardship? Is it something to do with family values? That is a question to which I would like an answer, and perhaps a rather better answer than I received on a previous occasion. I would also like it explained how a person can be totally disentitled to benefit under any normal circumstances without being in hardship.

I leave the Minister with the following question. If the Government are dedicated to preventing social exclusion, will they give their mind to monitoring what happens to people who are disentitled to benefit in order that they can find out information to rebut the charge which I shall most certainly make; namely, that in dealing with social exclusion they are creating it with one hand while combating it with another?

---