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Baroness Miller of Hendon: My Lords, I, too, should like to congratulate the noble Lord, Lord Davies of Oldham, on his promotion to the Government Front Bench. I should like to welcome him to his new role. I hope that he enjoys it very much but not for too long on the Government Front Bench; just on the Front Bench of his party. I am also grateful to the noble Lord for the clear way that he introduced these two regulations and for the fact that they were introduced together. That makes the process much simpler and, I believe, much quicker. In return, I should like to assure noble Lords that I shall be as brief as possible because these regulations were examined in much detail in Standing Committee in the other place. I know that many probing questions were put by my honourable friend the Member for Altrincham and Sale West.

The New Deal pilot regulations are of greater substance. Therefore, despite the fact that the Minister dealt with them the other way round, I should prefer to deal first with them. The concept of changing the old unemployment allowance--the dole--to the higher-sounding "jobseeker's allowance" is paved with very good intentions. However, what it really did, apart from changing the name, was to introduce more stringent conditions on the claimant for unemployment pay. In some parts of America they have what they call workfare--in other words, "Take such and such a job or you'll lose your benefit". We certainly agree with the objective of the introduction of stricter qualifications for the receipt of unemployment pay, to use a neutral term. That is why, when in government, we introduced the Jobseekers Act 1995, against, as I am sure the Minister will not mind me saying, opposition from the Labour Party at that time.

The Act under which the Government are now making the present regulations is that very Act. The qualifications are essentially that the claimant should be actively undergoing training or seeking work and should be available to do it if suitable work can be found. Indeed, that has always been the case, but what the jobseeker's regulations seek to do is to create a more specific definition of actively seeking work.

On 2nd July 1997, exactly two months into the present Government, the Secretary of State for Education and Employment said:

On 5th January 1998, six months on, the Chancellor of the Exchequer said:

    "From today there will be no option of simply staying at home on full benefit doing nothing".

But how much progress has there been in achieving these fine aims?

The Minister with the title that contains a full job description, the Minister for Employment, Welfare to Work and Equal Opportunities, told the committee in

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the other place that 16,000 people have been helped back to work. I believe that to be exactly the same number as the Minister gave us today. He also said that it had increased employment and decreased unemployment among young people. But what is the cost? By April, which is the last date for which I have figures, 60,000 people had been through the over-25-year-old pilots. The Minister in the other place claimed that 16,000 had found jobs lasting more than 13 weeks.

However, according to this month's Labour Trends, 69 per cent of those people would have found jobs anyway or were substitutions for existing workers for whom there was no state subsidy paid to employers. Therefore, on the basis of the Minister's claim of 16,000 going into employment via the New Deal, that is to say that 11,000 would have found jobs in any event. Deducting these from the figure of 16,000, we find, on the basis of the authoritative survey that I have just quoted, that only 4,960 new jobs were created. Of course, that is not a figure to be sneezed at.

The Minster said that the cost involved was £64 million. On the basis of 4,960 jobs, each job would have cost £12,900. The Government may well argue that this is a price well worth paying both in terms of the welfare of the extra people who have found work and the benefit to the Treasury in terms of less benefits paid out and in many cases income tax and national insurance contributions received. But the jobseeker's allowance does not create jobs. What it can do is to create incentives or impose sanctions to ensure that claimants take up any jobs that are out there waiting to be filled. It is here that I believe the Government have failed to live up to the lofty aspirations set out in the two ministerial pronouncements that I quoted earlier.

Indeed, there was a third pronouncement by the Secretary of State only last June, when he said:

    "We are determined that under the New Deal, there is no 5th option".

In a written reply to my honourable friend on 6th November, the Minister told him that, of the 60,000 people who had joined the over-25 pilots, 2,222 had been subjected to sanctions--that is, 3.7 per cent. The vast majority, 1,750, had been sanctioned for failure to attend. It is reasonable to surmise that a high proportion of those were people who may have already been in employment but who were nevertheless claiming benefit and had been trapped by the scheme. That is a useful spin-off but it does nothing to increase the potential of the scheme to get more people into work. The question is: why have sanctions not been extended nationally? I hope that the Minister will be able to tell us when they will be and, now that we have had the benefit of the experience of the pilot schemes, what the reason is for the hold-up.

I mention another problem. In the course of the debate in committee in the other place my honourable friend asked what sanctions applied to someone who was removed from a scheme through misconduct. The Minister was unable to answer at first until she received in the course of speaking what she later described as "clarification" from her officials. I am

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sure that she used the word "clarification" with a sense of irony. According to her, the answer is to be found by the use of the word "and" at the end of regulation 10(1)(a).

I take a few moments to read a shortened version of that regulation:

    "An income-based jobseeker's allowance ... shall be payable to a person ... even though section 19 of the Act prevents payment ... to him if--

    (a) an allowance would not otherwise be payable because the circumstances in section 19(5)(c) of the Act apply".

That section deals with wilful default. I resume my quotation with the Minister's magic word "and". The regulation further states:

    "and he has already participated in that same intensive activity period ... for ... 13 weeks".

What does all that mean? A claimant can be sanctioned for misconduct unless he has already gone through the same option. In other words, as I understand it, if he has taken a job for 13 weeks, he cannot then be sanctioned if he leaves that job or is dismissed for misconduct and declines to take another. I very much hope that I am wrong, but perhaps the Minister will obtain clarification on that.

As the noble Lord has had a longer time than his colleague to be briefed, will he please tell us in simple terms whether a person who declines to co-operate with the scheme can be protected from any sanctions to any extent in face of the clear and unambiguous wording of Section 19(5) of the Act which states that he shall be sanctioned by the loss of benefit? Can a claimant continue to receive benefit even though his unemployment is due to continuous misconduct? A simple yes or no answer would be sufficient if the Minister is able to obtain one from his officials. If the answer is yes, why are the Government turning the intention of the Act on its head by these regulations?

I must return to the figure of 60,000 persons claimed by the Government to have participated in this programme. It is acknowledged by the department that some people have participated in more than one option of the scheme, for example, they have gone on a training scheme and then have taken a job. Will the Minister confirm that there is no element of double counting here--I should be grateful to hear that--and that the Government are talking about 60,000 different people and are not including x thousands who have gone through a kind of revolving door?

The only substantive change introduced by the two regulations we are discussing is the new regulation dealing with joint claims. The Minister told the committee in the other place that this would affect only a small proportion of partners and is technical in nature. I believe that the noble Lord said more or less the same thing. I certainly accept therefore that that is the case.

The new pilot regulations are by way of a continuation of the existing scheme and are, we trust, a preparation for the extension of the scheme nationwide. We on this side of the House will keep the effect of those regulations under continuing scrutiny. We trust that the Government, without any prompting

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from us, will also keep them under review to ensure that they are genuinely effective in getting people to work, as distinct from providing the Government with another spinning platform.

The Earl of Mar and Kellie: My Lords, I have a simple question for the Minister. He used the words "Great Britain". I wonder whether that was a slip of the tongue and he meant to say the United Kingdom, or does this legislation not apply in Northern Ireland?

Lord Davies of Oldham: My Lords, first, I thank the noble Lord, Lord Goodhart, and the noble Baroness, Lady Miller of Hendon, for their kind comments. I am sure that I shall enjoy my new role for as long as I have it. I am aware of the fact that many people have some influence over that, not least the electorate in the not too distant future, although we in this House are not, of course, directly elected. I appreciate the sentiments that have been expressed. I shall certainly enjoy debating these issues with the noble Lords who have spoken today.

I apologise to the noble Lord, Lord Goodhart. I am not directly responsible for the website or the computer that malfunctioned in terms of sending information to him. I regret that that occurred. I shall ensure that the department is aware of the fact that he was unable to obtain the information to which he was thoroughly entitled. I hope that we shall do better in that regard in the near future.

The noble Lord referred to evaluation of the schemes. They are, of course, pilot schemes and therefore detailed statistical analysis must obviously be limited. However, we published a report on 9th October. I understand from the noble Lord's remarks that that information was not as full as he would have wished. I think that he will, however, recognise that the evaluation of pilot studies is bound to be more limited than in the case of a full ongoing programme. I hope that the noble Lord has been able to discern from more recent statements that there is justification for the Government's view that the schemes have been successful.

The noble Lord is right to surmise that there is some underspend with regard to the programme. That amounts to £13 million. I notice that a former Chancellor of the Exchequer is present. Therefore I am mindful of the fact that it is important to be as accurate as possible with regard to the department's figures. However, the underspend in this area may be due to falling unemployment and the fact that fewer people are therefore eligible to attend the programme. It may be considered that in those circumstances the underspend is understandable and justified.

The noble Baroness said that the Secretary of State had emphasised that there should be no fifth option. I am sure that all noble Lords would agree that people have responsibilities as well as rights and that people who are well and able to work should avail themselves of the opportunities under the programme to prepare themselves more effectively for work.

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The noble Lord, Lord Goodhart, referred to a particular category of people on the scheme who present real difficulty with regard to their consistent availability for work. I think that we all share those sentiments. As regards the long-term unemployed, many factors are involved, some of which need to be remedied in terms of improving their competence. However, some of them may relate to more obvious difficulties such as health and preparation, to which we should pay proper regard. I appreciated the noble Lord's comments on that point. I assure him that in evaluating the success of the schemes and the question of when sanctions should be invoked Ministers will ensure that schemes are designed to be fully sympathetic to difficulties which some people may experience. In those circumstances sanctions would be inappropriate and would not be applied.

The noble Baroness, Lady Miller, suggested that the figure of 16,000 beneficiaries of the scheme that I mentioned could be computed rather differently by estimating a percentage of people who might have found work anyway. That is a hypothetical judgment. Thanks to the more general success of the Government's economic policies, unemployment has fallen so far that our record is the envy of many other countries. However, the noble Baroness's computations led her to an extraordinarily precise figure of 4,960 people who would not otherwise have found work. That is a little on the low side. I recognise that our interpretation is bound to be open to dispute, but we can state categorically that 16,000 people are in work because of the effective operation of the system.

The noble Baroness and I are united on the general principles behind the order: that staying at home and making no attempt to make oneself available for work is necessarily to be deplored. Precise and effective government action was required to remedy that.

The noble Earl, Lord Mar and Kellie, referred to a slip of the tongue on my part. When I referred only to Great Britain, I was talking about the 28 pilots. There is a similar programme for Northern Ireland. The joint claims regulations are specifically for Great Britain. I am sure that the noble Earl knows that the New Deal scheme has a counterpart in Northern Ireland.

I listened carefully to the noble Baroness' comments on the interpretation of the details. I cannot pretend that I came to my new role with an enormous enlightenment on the details of the regulations. I struggled likewise to interpret them accurately and effectively. At least we have that in common. I assure her that sanctions are introduced when an individual has failed to comply with the requirements of the programme. She said that wilful misconduct would render an individual unacceptable to their employer, but that would bring the individual back into the scheme either for an effective presentation for the next position or for a sanction because the terms of the arrangement had been broken. We make no apology for that. We have emphasised all along that the right to benefit must be balanced against the obligation to be available for work and to conduct oneself appropriately when one has a job. I hasten to add that the counterpart to that is that anyone who enters work

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under the scheme also enjoys all the rights and protections that we expect all employees to have in relation to the conduct of their employer.

I hope that I have answered all the detailed points that have been raised. I apologise if I have failed in any respect, and I assure your Lordships that I shall reply in detail in writing as soon as possible. On the basis of the debate, I commend the regulations to the House.

On Question, Motion agreed to.

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