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Welfare and Skills

Volume 468: debated on Monday 26 November 2007

With permission, Mr. Speaker, I will make a statement about the reform of welfare and skills.

Since 1997, the Government have transformed work: 29.2 million people are in work—2.8 million more than in 1997—1 million fewer people are on out-of-work benefits, and increased prosperity has been felt in every region and every nation in the UK. But the world continues to change, and we must change, too. In an increasingly globalised and competitive world, we must use to the full the skills, talents and aspirations of all our people. As my right hon. Friend the Prime Minister said this morning, Britain’s economy of the future will have 5 million fewer unskilled jobs than today, so to succeed as a country, we must raise our skill levels as never before.

The global changes threaten those who are least well equipped to respond. Those with low skills will find it harder to find work. Even today, it is estimated that 15 per cent. of claimants have basic skills needs and 50 per cent. have qualification levels below level 2. They and their families struggle to share in the increasing prosperity of Britain.

That is why, today, together with my right hon. Friend the Secretary of State for Work and Pensions, I have published “Opportunity, Employment and Progression: making skills work”. It sets out how we are transforming welfare by putting skills at the heart of the system. As my right hon. Friend the Prime Minister said this morning:

“If in the old days lack of jobs demanded priority action, in the new world it is lack of skills.”

We will change the benefits, skills and employment system. When people sign on for benefits, they should sign up for skills. We will make it easier for those on benefits to gain new skills. We will provide the tailored support that people need in order to get into work, and we will provide new opportunities for people to train. We intend to introduce legislation to give legal rights to train, but with those rights come responsibilities—responsibilities to upskill and to work.

Obtaining work, however, is just the start. We will also help people to get on in work by helping them to progress. We will create an advancement and careers service to help people overcome the barriers to moving from welfare to work and beyond. As my right hon. Friend the Secretary of State for Work and Pensions has announced, all new jobseeker’s allowance claimants will be given a more rigorous skills check to identify those who need basic numeracy, literacy and English language training or support. All new claimants will be able to use the new advancement and careers service to undertake a comprehensive skills health check. For those who are out of work for six months, we will make skills health checks mandatory, at the discretion of Jobcentre Plus advisers.

Where the need for raised skills is firmly identified, we will pilot giving Jobcentre Plus personal advisers enhanced powers to mandate training, and to offer training allowances of up to eight weeks’ full-time study when it is clearly designed to meet employers’ needs. For lone parents on income support we will extend the employment retention and advancement pilot nationally, providing in-work advisory support and discretionary emergency hardship grants of up to £300. We are also rolling out a weekly work credit of £40, or £60 in London. All lone parents will receive a skills screening at the start of their claims, and we aim to ensure that all of them can undertake a skills health check. We will offer such a check to lone parents two years before they are due to return to work, and will consider making it mandatory.

For those on incapacity benefit, the housing benefit rules will be changed to abolish the 16-hour rule which limits the hours of study for those on the short-term rate. Long-term benefit claimants moving into work will see an increase in income of at least £25 per week, allowing for reasonable transport costs.

As we change the welfare system, we will also improve opportunities to train. In setting the Learning and Skills Council budget for the next three years, I recently announced improved opportunities for training at every level. We will invest £1.5 billion a year in basic skills for life and pre-level 2 training. We will increase the number of training places at level 2 to 800,000 by the end of the next three years, and will increase the number of level 3 places by 148 per cent. by three years from now. We have set aside enough funds—subject to the availability of high-quality employer places—to increase the number of apprenticeships in England from 250,000 to 400,000.

However, we need to do more to ensure that the training opportunities are available to those who need them most. My right hon. Friend and I will ensure that Jobcentre Plus, colleges and training providers work more closely together. Tomorrow my right hon. Friend will give more details of how Jobcentre Plus services are to be commissioned in future, but I can say today that there is a joint commitment to greater convergence with LSC funding, and that we will jointly explore the scope for progressively joining up processes to underpin the integration of employment and skills services.

For many people, the transition from a low-paid to a better-paid job can be as hard as moving from benefit to work. We will ensure that the advancement and careers service works closely with Jobcentre Plus, training providers and other voluntary and statutory agencies to provide skills screening, skills health checks and access to advice on overcoming all the obstacles to progression, including child care, housing, transport and in-work benefits. I can announce today that I have allocated £2 million to test 10 prototypes in 10 areas next year.

The advancement and careers service will provide full skills health checks for half a million work seekers and half a million people in work per year by 2010-11. I can also confirm that we will pilot skills accounts from next year. We want learners with skills accounts to have access to £500 million of funding by 2010-11, and to nearly £1.5 billion by 2015.

Through local employer partnerships, more than 200 companies have committed to offer jobs to people who are out of work, helping towards meeting our target of 250,000. The Learning and Skills Council, colleges and training providers will work closely with Jobcentre Plus and employers to ensure that individuals receive both pre-employment and in-work training. High-quality in-house training is provided by many companies involved in the LEPs, and I have asked for the accreditation of in-house employer schemes to be fast-tracked, and expect the first schemes to be accredited by Christmas.

This country can deliver the opportunities to work and to gain better skills only through the closest possible partnership with employers. That is why we are making the training system more responsive and flexible to meet the needs of employers. Fifty-two thousand employers have taken advantage of “train to gain” with more than 100,000 learners gaining new qualifications. Today I can confirm that the budget for “train to gain” will rise to more than £1 billion by 2010-11—about one third of the adult training budget. Colleges that are successful in meeting employers’ needs will be able to expand the volume of training they provide, and the bureaucracy of taking part in “train to gain” will be reduced.

We will allocate £90 million to enable 60,000 small and medium-sized businesses to identify how skills training would grow their business and profitability. We will extend “train to gain” to cover volunteers, the self-employed and offenders who have secured employment prior to their release. We will ensure that there is a further education system that provides specialist vocational excellence in key areas of teaching and learning, both at national level—through national skills academies—and at regional and local levels. “Train to gain” brokerage will be extended to larger companies.

Our reforms to put skills at the heart of welfare will help to drive Britain’s economy forward to compete in an increasingly competitive world. By giving people new rights and responsibilities, we will unlock the talent and aspirations of all our people to ensure that no one gets left behind. These reforms are fundamental to creating a stronger, fairer and more prosperous society. I commend the paper to the House.

Nobody on the Opposition side of the House would quarrel with the Government’s objective of having a more skilled work force, or the importance of tackling the barriers that stop unemployed people getting into work, but in order to make real progress in tackling those problems the Secretary of State would have had to confront uncomfortable evidence that would have explained that after 10 years of initiatives many of the Government’s policies are still not working. In particular, why is it that after 10 years the number of young people aged 16 to 24 who are not in education, employment or training—the so-called NEETs—has increased from 1,082,000 to 1,260,000? The Secretary of State should have confronted that uncomfortable evidence, so as to do better in the future.

The Opposition agree on the importance of linking jobcentres and skills. That link desperately needs to be made, and we want it to work. Again however, for it to work the Government need to learn lessons from what has not worked so far. In particular, if the only skills training that is going to be available at jobcentres is accredited training leading to LSC-approved qualifications —which is how so much of the funding is currently disbursed—is there not a real danger that some of the most worthwhile programmes will suffer from not being accessible to unemployed people? This morning, I visited City Lit—probably the country’s largest adult education college, and an excellent institution which I know that the Secretary of State has visited—where I was told that many of its most worthwhile courses that help people out of unemployment and into work were suffering from cuts in LSC funding, because they did not provide accredited qualifications of which the LSC approved. If the Secretary of State is going to use this joint working simply to push people into accredited qualifications, is there not a danger that he will miss out many of the courses that people really need?

I also have some questions about the programmes that the Secretary of State has announced. He has announced that £1.5 billion a year will be invested in basic “skills for life” and pre-level 2 training. He has announced that we will increase the number of training places at level 2 to 800,000. However, are these not courses that plug the gaps that should have been filled at school? They are teaching people the basics of reading, writing and arithmetic—giving people the basic equivalents of GCSEs. The Secretary of State began by saying that this was part of his new vision of a highly skilled work force competing in a competitive global economy. Now, what he is really announcing is extra places to plug the gaps in a school system that should be doing better.

I accept that not all those people left school under Mr. Blair. Some will have left school under Margaret Thatcher and John Major, and quite a few probably left under Harold Wilson and Jim Callaghan. However, the Secretary of State cannot pretend that such a programme is in any way rising to the challenge of providing skills for the 21st-century economy.

The Secretary of State also talked about apprenticeships, but let us be clear about what he is pledging. He is now talking of a target of 400,000 apprenticeships, up from 250,000 today. Will he confirm that back in 2002, the then Chancellor—now the Prime Minister—promised 300,000 apprenticeships by 2004? Will he confirm that then, in April 2003, the then Chancellor promised 320,000 apprenticeships by 2006? Will he confirm that as recently as this year’s Budget, in March, the then Chancellor promised to double apprenticeship numbers to 500,000? So what we have here is a record of successive retreats from ambitious commitments and pledges because of a failure to deliver them. Will the Secretary of State also confirm that the number of apprenticeships that we recognise as apprenticeships—genuine technical qualifications sponsored by employers, which are now called advanced apprenticeships—have been in steady decline under this Government, and have now fallen below 200,000?

Finally, I congratulate the Secretary of State on something that is enormously to his credit—on not using at any point in his statement today that British National party slogan, “British jobs for British workers”. The Opposition congratulate him on his self-restraint. Long may it continue.

I am grateful for the warm welcome that the hon. Gentleman has given the statement—but unfortunately I have to point out to him that he is in error on almost everything that he said. Let us take for a start the claim that the figure for young people not in education, employment or training shows a fundamental failure in the system. The first thing that we must understand is that there has been a massive fall in the long-term youth unemployment that characterised the experience of so many young people under the Conservative Government. Secondly, there has not been a significant change in the proportion of that cohort who are not in education, employment or training compared with the period when the Tories were in power; however, there have been very significant shifts in what it represents. It represents not only far less long-term youth unemployment but the massive increase in the number of students taking gap years from university, who are not distinguished in the figures.

There is a real issue here. There has been some increase in the number of under-25s claiming incapacity benefit, which is one reason why my right hon. Friend the Secretary of State for Work and Pensions, as part of his statement earlier today, indicated that pathways to work—the very successful programme that has begun to reduce the number of people on incapacity benefit—will not only be extended nationally to new claimants but will for the first time be targeted at existing claimants, starting with the under-25s. So where there is a problem, we are determined to address it.

On training, the hon. Gentleman and I are simply going to have to disagree. There are a range of measures, budgeted for, for the Learning and Skills Council and Jobcentre Plus that are intended to ensure that individuals gain the early skills that they require to get into work, and that they can continue to get recognised qualifications when in work. Those courses—whether they are delivered by the employability skills programme that started in August, which focuses on getting people into work, or by the pre-level 2 programmes—are designed to achieve the two things that individuals want: sufficient capacity to get a job in the first place, and the qualifications and skills that mean that they remain in work and do not go back on to benefit. Our programmes are chosen with those aims consistently in mind. We have stripped out the programmes that have proved not to be effective for the individuals concerned.

As for the £1.5 billion to plug the gap, the hon. Gentleman had enough intellectual honesty to abandon his argument halfway through. We could spend all afternoon agreeing that Mrs. Thatcher’s Government were a terrible Government. A moment’s thought will tell us that the vast majority of those in the work force did not leave school under this Government—and certainly did not complete the greater part of their schooling under this Government. That does not really matter, though, because some of them did, and the point about these policies is that we cannot write people off. There must be a second or even a third chance for people who missed out first time round—and I would extend that to the diminishing number of young people for whom that would be true under this Government. This is the right thing to do.

On apprenticeships, the hon. Gentleman’s research is simply wrong. He has—inadvertently, I am sure—confused figures that my right hon. Friend the Prime Minister used when talking about the UK as a whole with the figures that I have been using for England. The significance of my announcement is that the target for 2020 was for 500,000 apprenticeships for the UK as a whole and 400,000 for England. With the funding that we have set aside, and if we can secure the proper, quality employer places, we can achieve the 2020 target about eight years early. That would be good for the economy and enormously good for young people who are seeking work in this country.

I congratulate my right hon. Friend the Secretary of State on his visionary statement. Although I agree that many people need help because they did not have the advantage that young people have today of having literacy and numeracy skills set before them, some who did have such chances now need to gain new skills because they have ill health and have to change to a different job. Will my right hon. Friend explain to the House more fully how people whose old skills are no use to them any more, and who need a new chance, can, with the help of their employer and perhaps their trade union, train for something else?

My hon. Friend raises an important issue, and I shall just mention two things. First, I pay tribute to the work of the 18,000 union learning representatives. We estimate that they have encouraged about 250,000 fellow employees back into work over the past couple of years since the scheme has been running. Someone’s best friend at work will often be the most likely person to convince them that they should have another go at training, and the union learning representatives have been a success.

Secondly, and importantly, I come to something that was part of our review of “train to gain”. In the first year of the programme, it was not possible to use “train to gain” to provide a subsidised place for someone who already had a level 2 qualification. We are now saying that where an employer is using “train to gain” we will not discriminate in that way between those of their employees who have a first level 2 qualification and those who do not. That will free up the system enormously for precisely the sort of person that my hon. Friend has in mind.

I thank the Secretary of State for providing an advance copy of the statement, and there is much to be welcomed in it. The joined-up approach is common sense, and I welcome the change in respect of the 16-hour rule for benefit and study. We have requested that for a long time. We might question why the long-term unemployed and those who are workless were not receiving a skills audit as a matter of course, because most people would have expected that to have been happening anyway. It is worth reminding everyone that the number of people who are long-term sick is more or less the same as it was when this Government came to power in 1997.

I have some questions about the Secretary of State’s statement. Does he envisage the advancement and careers service to be the same as the universal adult careers service that he announced in the summer? If it is not the same, how were they linked together? If it is the same, has he learned the lessons from the Connexions service? Although Connexions improved the service for many young people from socially excluded groups, we found that a decline in access occurred for people who wanted simpler and more straightforward advice.

There are three obvious elements that a careers service needs to work. The first is personalisation, the second quality and the third independence. Personalisation is obviously key, and I wonder whether the Secretary of State has learnt the lessons from the new deal, in which many young people were pushed on to generic programmes, rather than on to specific courses that addressed their personal issues. Does he envisage some sort of triage system, which could provide signposted advice to people who may require advice on medical issues or child care? How would that link with the careers service?

Often, the issues with access to training and work are about confidence, and many people do not have the self-confidence to go on a full accredited course. It would be a shame if the Government ruled out the option of unaccredited courses, in areas such as leisure, which they often pooh-pooh. For many people, those are the only route back into learning.

On quality, how will the proposals be linked with the closure of Jobcentre Plus offices, especially in rural areas? Does the Secretary of State really think that Jobcentre Plus is the ideal vehicle for providing an expert careers service, and will he invest sufficient money to bring it up to standard? The Connexions service provides services to 2 million young people and costs £500 million. If we extend that to all the workless, it would cost some £2 billion. Does he envisage that level of investment to provide a high-quality service?

On independence, what involvement does the Secretary of State envisage for the voluntary sector, and what role will local authorities play? The Lyons review, for example, foresaw a role in place shaping, and that would appear to be a good example of how local authorities could play a role in training.

For many people, it is a big jump to a full accredited course. The people who are finding it difficult to stay in the job market are the very ones who will find it difficult to stay on a full course. When will the Government make proposals for a credit-based or unitised approach to level 2 and level 3 accredited learning? That is vital to ensure that people who begin training can reap the benefits of what they have already undertaken.

The Secretary of State has announced £1 billion for the “train to gain” programme—but what proportion of that money will go to the broker system, rather than to training?

I congratulate the hon. Lady on a considered and intelligent response to the issues I raised this afternoon. The figures that I have for incapacity benefit suggest that the numbers claiming it have fallen since 2003 by 120,000, which is due in no small measure to the success of the pathways to work programme, which is why it is now being extended across the country and targeted at young people under 25. It is worth remembering that had the trends continued as they had become well established in 1997 under the previous Government, some 4 million people would be on incapacity benefit by now. This Government had to turn round the supertanker and get it going in the right direction.

The hon. Lady asked about the advancement and careers service, and it does refer to the same concept. My view was that the idea of a careers service sounded much narrower than the practical support that many people want, which will also address child care support, disability access issues and housing issues, all of which may be as significant an obstacle for an individual as the obtaining of a qualification.

The hon. Lady raised some good questions about the design. As I said in the statement, I want to see about 10 prototypes across the country, because I do not want to prescribe the approach from the centre. We will need to link up Jobcentre Plus with colleges—but different areas have different patterns of local voluntary sector advice services, for example. I hope that local authorities will make various proposals for the best way to achieve an integrated service, and I am sure that they will involve the voluntary sector.

On the issue of accreditation, vocational qualifications are moving towards a system of unitised credits, so it will be possible for someone to put together a vocational qualification having done part of a course here and part there.

That is attractive and sensible. However, it is not sensible for us to start putting a lot of money into completely unaccredited courses that cannot contribute to an overall training or qualification record for the individual. Despite what is often said by advocates of unaccredited courses, there is little evidence that they are helpful in enabling people to get into work or stay in work.

During the Queen’s Speech debate on training, Cabinet Ministers said that every young person would have a legal right to an apprenticeship. Today, my right hon. Friend said that increasing the number of apprenticeships in England from 250,000 to 400,000 would be subject to high quality employer places being available. Will he assure me that if not enough apprenticeships are available in the private sector the numbers will be made up in the public sector?

I can certainly tell my hon. Friend that we want significant expansion of public sector apprenticeships. Some parts of the public sector, including the Ministry of Defence, have a tremendous record in providing high quality apprenticeships; others, including some but not all local authorities, the health service and so on, provide relatively few. We shall want to encourage such provision in any case. We hope to achieve the legal right for young people by 2013. However, I do not want to mislead the House; we could achieve the 400,000 England total without actually reaching the full number we would need to meet the young person’s guarantee—that will take longer on any trajectory. I do not want to achieve the numbers of apprenticeships at the cost of quality, so it is right that we always caveat the target. We have put aside the money, a major review of apprenticeships is going on and a draft Bill on apprenticeships will be published later this year setting out our plans. All that will be aimed at ensuring we get the number of apprenticeships we want as well as high quality. There is no point in giving young people a guarantee if it is not a guarantee of something they actually want.

Earlier, in seeking to dismiss the figures given by my hon. Friend the Member for Havant (Mr. Willetts), the Secretary of State significantly did not mention the number of advanced apprenticeships. Can he inform the House of the number of advanced apprenticeships over the last few years and tell us what plans he has for those schemes? A lot more people will reach level 2 qualifications, but if we are really serious about building skills for the future we need a lot more people to do an awful lot better than they do at present.

We need to remember that this is all relative; there were only 75,000 apprenticeships when the Government came to power, but there are 250,000 now. The completion rate for level 3 apprenticeships was not good and we have massively increased and improved the completion rate for level 2 apprenticeships. One of the issues the apprenticeship review will examine is options for an increase in apprenticeships at higher level. As a step in the right direction, in our recent guidance to the Learning and Skills Council we asked for 30,000 new apprenticeships—10,000 a year—aimed specifically at over-25s who want to retrain or up their skills to a higher level. I think that will be the first time provision has ever been made for a dedicated apprenticeship service for over-25s.

May I ask the Secretary of State about one of the most excluded groups in Britain—teenage mums? As he knows, we have the second highest level of teenage pregnancy in the world and the highest in Europe. All the evidence suggests that girls who underachieve at school are the most likely to get pregnant under the age of 16 or 18 and that those who become teenage mums are the least likely to complete their education. Will my right hon. Friend consider launching a particular effort to try to cut teenage pregnancies by increasing educational opportunities?

I am sure my hon. Friend is right. It is an issue that the Secretary of State for Children, Schools and Families, my right hon. Friend the Member for Normanton (Ed Balls), is pursuing with the Department of Health. It is enormously important. It is also important that there is the possibility of a second chance for teenage mothers so that, having started a family much earlier than they had planned, or possibly wanted, they can still get back into the world of work. One of the reasons why we want the new advancement and careers service to reach into places such as Sure Start children’s centres is to make it clear that there are options to go back and train and to have a second chance to gain the skills and qualifications that were missed at school. We must make sure that such advice is available in the places that young teenage mothers are likely to go and where they are likely to be with other people who can support them to take up a training option even if they missed out at school.

Does the Secretary of State not accept that his Prime Minister actually appreciates the achievements of the Thatcher Government despite what is said by those on the Government Benches? It is important to understand that.

Does the Secretary of State not also accept the point made by my hon. Friend the Member for Havant (Mr. Willetts) that secondary schools underplay and underestimate the importance of vocational training, which is now provided in the main by colleges? What extra money is therefore being given to the colleges of further education, such as Macclesfield college, that do so much to provide the skills that are required by the industrialists and the commercial companies of this country?

Vocational training should obviously be properly recognised in every part of the education system. That is one of the reasons why my right hon. Friend the Secretary of State for Children, Schools and Families has brought forward proposals not only to introduce but to extend the range of diplomas, which for many young people will be able to bring together academic and vocational studies. It is also one of the reasons why the machinery of government was reorganised to give the Department for Children, Schools and Families a clear focus on 0 to 19-year-olds and particularly on 14-to-19 policy. It is very important that there is a coherent plan in each area for the different routes available to young people at 14 and that must include the option of a good vocational education, including the option of a pre-apprenticeship in school and going on to an apprenticeship at 16. I hope that the effects of these reforms overall will be to ensure that all children receive guidance that a vocational course is a very good course to take if it is right for their skills, aptitudes and ambitions.

My constituents in Blackpool will very warmly welcome what the Secretary of State has said about the abolition of the 16-hour rule, about the extra help for small and medium-sized businesses and particularly about the support for lone parents, of whom there are high numbers in this country. However, does he agree that the reskilling of older workers in particular is as vital as upskilling? To that extent, will he confirm that, as part of the overall approach, the Government are looking to have an all-age strategy for advice and guidance and, in so far as they are able to do so, they will make it clear to local authorities with budgetary considerations that they should do likewise?

First, I pay tribute to the work that my hon. Friend has done on the issue of skills, particularly as part of his leadership of the all-party skills group.

Of course, this is not purely a strategy for younger members of the work force. Everybody will recognise why a priority is given to lone parents and to under-25s because of the long-term costs to them of being locked out of the world of work and becoming totally dependent on the benefits system. However, the overall approach has to apply right across the work force. That is one of the reasons for creating apprenticeships aimed directly at the over-25s, and it is another reason for changing the “train to gain” system so that it can include those people who already have a level 2 qualification if their employer is taking part in “train to gain”. The advancement service is clearly there for them as well.

The challenge of getting the work force that we need in this country by 2020 means raising skills right across the work force. Some 70 per cent. of that work force have already left school and the grim truth for our economy is that we cannot achieve the skills levels that we want by focusing solely on those who are currently in school or have left school in the past few years.

We have said today—my right hon. Friend the Secretary of State for Work and Pensions has said it—that it has been agreed that there will be pilots for mandatory training. That will come in after six months if a personal adviser is, first, convinced that somebody should undertake a skills health check and, secondly, that it would be directly relevant to them to get training. Although the details have to be worked on, I suspect that it will also take place after somebody has refused to take up the offer of extended support, such as up to eight weeks of full-time training with a training allowance. Most people in the House would take the view that the system should operate to provide people with every possible bit of advice, encouragement and support to go back into training, but there is a point at which somebody has to say, “If you haven’t taken the opportunities, you can’t expect not to do anything about it.”

I welcome the thrust of my right hon. Friend’s statement, but I take exception to one point. There is absolutely no evidence that moving lone parents to a JSA regime will produce the effect that has been mentioned. His last words, about encouraging people to participate, reflect the right approach—not being punitive. Is he aware that the big four supermarkets employ 600,000 people and 200,000 a year leave—most of them are women and a large percentage are lone parents—because they are given no skills, no encouragement, no training and no prospect of advancement? What does that say for the skills pledge that all those companies have signed?

The detail of the proposals to lower the age—the children’s age—at which lone parents can continue to claim income support, and other changes to the JSA regime, were consulted on in the summer. The Department for Work and Pensions has just come to the end of the consultation period and will deal with the detailed issues that my hon. Friend raises when the results of that consultation are announced in due course. However, there are things that most people will welcome in today’s announcement—particularly the roll-out of the employment retention allowance, part of which is aimed at dealing with the sort of short-term problem that can force a lone parent out of the labour force, when otherwise they would keep their job. It is sensible to get lone parents to focus on their skills needs well before the time when they might potentially lose their entitlement to income support. So there is a period of two years during which, by definition, the children will be at school—there will be extended schools to cover the hours—and the lone parent will have time to gain qualifications. Those changes to the regime are sensible and will have a positive effect on the lives of many lone parents.

Plaid Cymru and the Scottish National party welcome, in particular, the changes to the 16-hour rule. Any further investment in skills is very much welcome too. The Secretary of State said that claimants will be helped to gain core skills, including English language skills where needed. Welsh language skills are occupational qualifications for many jobs in Wales. Will the Government make extra, consequential help available to the National Assembly to take on this extra burden?

This is one of those moments when my gratitude for the fact that this is a dissolved responsibility—[Interruption.] Not dissolved, devolved. This is one of those moments when my gratitude for that fact knows no bounds. However, I will draw the matter to the attention of the relevant colleagues.

The statement contains a number of useful initiatives, but will my right hon. Friend say a little more about the 16-hour rule? That rule has been a barrier not only to young people, who have not been able to fulfil their potential by getting back into education, but to people who have lost their jobs. Up until now, we have sent out a ludicrous message by telling them to retrain and then cutting their benefit if they do. How are the changes intended to work, not just for those on incapacity benefit, but more broadly?

First, on incapacity benefit—an issue on which many Labour colleagues have campaigned for a long time—we have said that we will remove the 16-hour rule in relation to housing benefit completely for short-term recipients of incapacity benefit so that they, like long-term IB claimants, will always be able to take up the training they need to return to work. We will consider whether it might be practical to define limited exemptions from the 16-hour rule for specific groups such as young people living in supported accommodation—an issue that has been pushed strongly by the Foyer movement. In addition, under the JSA regime, there will be the possibility that after the six-month point has been reached, the DWP or the Jobcentre Plus advisers will have greater discretion to offer a training allowance for up to eight weeks of full-time training, where that is judged clearly to be what an employer needs to get an individual back into work.

Will the Secretary of State clarify whether it is still the case that people who have enormous difficulty in reading, writing and counting can still be in receipt of JSA for six months without any requirement that they receive help in upgrading those skills? Is that not a real worry, given that two thirds of all JSA claimants each year—around 1.6 million people—are making repeat claims, so many claimants are going in and out of work before the six-month period, with very low skills?

One of the reasons for ensuring that the initial skills check is more rigorous than the current check is to ensure that those whose basic numeracy and literacy problems have not been tackled in the past are correctly identified and directed towards the areas where they can receive assistance. We have also said, and I said this afternoon, that further down the process, we will pilot mandatory training for those whose personal adviser judges that that is the major obstacle to getting somebody into work. In doing that, we will look at the experience that we have gained from a prior attempt to pilot the scheme, which did not produce a big return to work. We believe, though, that particularly with the development of the employability skills programme that was introduced jointly between my Department and the DWP just this August, we are clearer about the type of work-related training that can successfully deliver the very skills to which the hon. Gentleman refers, and therefore make the piloting of mandatory training more plausible than it may have been in the past.

In the Westbourne ward in my constituency, 83 per cent. of all children are growing up in workless households only a mile from the west end, not because those people lack ability or because they lack motivation, but because of the multiple challenges of high housing costs, high child care costs and a mismatch between skills and the labour market. Will my right hon. Friend consider areas such as that being used as a prototype to test various measures, and in particular to examine the issue of job sustainability? It is not entry into the labour market, but keeping work that is the problem. Will he undertake to examine why some areas and some groups of people face particular problems maintaining themselves in work?

I pay tribute to the high level of work and sustained commitment that my hon. Friend has given to this area of interest. I cannot say this afternoon where the prototype areas for the advancement service will be, but I am sure that if the right group of people could be put together locally, we would certainly be interested in proposals coming from her area. She rightly identifies the complex set of issues that individuals often have to face in moving successfully into work. Rightly, I have emphasised to the House this afternoon the importance of skills, but I have also emphasised that often it is not skills alone that will make the difference to somebody’s ability to progress.

It is worth my reinforcing what I said in my statement about our overall aim—that is, we will ensure that long-term unemployed lone parents and those on incapacity benefit are better off in work, even after reasonable transport costs. That will be done by ensuring that long-term benefit claimants moving into work will see an increase in their income of at least £25 per week for, I think, a six-month period. That commitment and the changes that will be made to implement it will be significant in my hon. Friend’s area.

I understood the Secretary of State to say that there would be up to 500,000 improved and more rigorous skills health checks a year. Can he, in conjunction with his Secretary of State colleague, assure us that there will be sufficient people with the ability and skills to carry out those skills health checks, that the checks will be rigorous, appropriate and not peremptory, and that they will be supported by people and advisers who know not just about job placement, but about careers development and the educational attainments that are appropriate to the scheme? If there is to be a single skills result, there must be a multi-skills offer for those people.

The hon. Gentleman has made a constructive point, which relates to one of the reasons for having a number of pilot or prototype areas. There will be different ways of bringing together in local areas people with the various skills that he has described. We need to invite people to suggest the best ways of achieving the aim that I have set out this afternoon.

To be clear, two types of skills checks are being talked about. One is the original, simple—although hopefully more rigorous than it is today—skills check for the new claimant to identify their basic skills needs. The 500,000 skills checks or health checks for those in work and the other 500,000 for those out of work are the more comprehensive assessment, which would look at everything—existing vocational qualifications and skills needs other than basic numeracy and literacy. Rather more will be taking place than the hon. Gentleman took from my earlier statement.

The Secretary of State’s announcement this afternoon, with all its meaty proposals, stands in stark contrast to the lightweight proposals on the skills agenda that have come from the new Scottish National party Government in Scotland. Like many others, I welcome the abolition of the 16-hour rule in housing benefit; that was acting as a real barrier against people with disabilities getting back into the workplace and into training.

Has the Secretary of State looked at the physical barriers against disabled people going into training? There is an excellent access to work scheme that helps disabled people going into work to get adaptations or equipment that they need to access the workplace. Is it time for an equivalent access to training scheme, which would help disabled people to get into college or university for whatever training they need, so that they can upskill and get into the workplace?

My hon. Friend has made a good point. With others, my Department has to publish a single equality strategy, and I assure her that as part of that we shall look again to ensure that we have identified the issues that she has raised and to see whether further things should be done. My hon. Friend has made a valuable point and she is certainly right to pay tribute to the access to work programme, which has helped many people.

Does the Secretary of State agree that there is a great deal of difference between an inability and a disability, and that British citizens who do not speak the English language have an inability, not a disability? If he agrees, what progress does he think he will make on the issue in the next 12 months? What target has he set himself for getting people who do not speak English, and who are unable to work as a result, into the workplace?

The hon. Gentleman will know that we have recently made a couple of important changes to the English for speakers of other languages arrangements. First, we want to ensure that the budget, which is three times as big as it was just four or five years ago, is better targeted and that those who can afford to pay, and should reasonably be asked to, make a contribution towards the cost of their training. We want to do that to make sure that we target those in greatest need.

Secondly, we have introduced an ESOL for work programme for more recent migrants. That is paid for, but we think that it will meet the immediate workplace needs. I think—and I suspect that the hon. Gentleman does—that the challenge comes from those long-term residents, often British citizens, who do not have the English language and are therefore excluded from many activities of wider society. I assure him that we shall continue to look closely at the ESOL system and how it operates to see what we can do further to target resources on those people.

Does the Secretary of State agree that transport costs can be an obstacle to those who want to take full advantage of the opportunities available to them? Will he support the north east regional youth assembly in its campaign for concessionary travel for those between the ages of 16 and 19 who want to pursue further education and training across the region?

I pay tribute to my hon. Friend’s imaginative initiative in raising an issue that is beyond my departmental responsibilities, in respect of funding for 16 to 18-year-olds and transport policy. I cannot answer directly about any proposals on that particular age group. However, I draw attention to the commitment to which I have already referred a couple of times today: we intend to ensure that long-term unemployed lone parents and those on incapacity benefit are better off in work, even after reasonable transport costs. That will be done by ensuring that long-term benefit claimants moving into work will, for a period, see an increase in their income of at least £25 a week. That applies to workers older than the group to which my hon. Friend referred; we clearly have plans to raise the participation age and so on. I shall draw his question to the attention of my right hon. Friends.

Hertford regional college in my constituency is undertaking a major new build programme to create a campus in Turnford fit for the 21st century. However, it will have to pay a VAT bill of more than £3 million for that building work. When secondary schools do new build work, they are not subject to VAT. Will the Secretary of State make representations to the Chancellor on behalf of the further education sector to see whether we can end that inequality?

Bearing in mind that 10 years ago there was no capital budget for further education colleges at all, I am fortunate to be presiding over a budget of £2.3 billion for FE colleges over the next three years. It is a bit of a cheek to complain about the VAT rules that applied under the previous Conservative Government.

But it is worth making the point that the difference between schools and colleges is that colleges are incorporated as independent institutions, which gives them a different tax treatment. I have not yet met a principal of an FE college who wished to return to local authority control, even if they would be able to reduce their VAT bill as a result.

I welcome the statement, particularly the great expansion in the number of apprenticeships. Does my right hon. Friend agree that the people at the bottom of the pile in respect of access to jobs and skills are ex-offenders? Although his statement makes reference to offenders who have secured a job before their release being able to benefit from “train to gain”, the majority of offenders are not in that position. Does he agree that providing more advice, guidance, support and assistance for offenders after they leave custody is important both in its own right and as an incentive to reduce reoffending?

My hon. Friend is absolutely right to talk about the importance of offender education. I understand that the number of learner hours has increased by 35 per cent. in the past year alone. However, I would not like to lose sight of the significance of today’s announcement. We know that one of the things that most reduces reoffending is an offender’s knowing that they are working towards a guaranteed job when they leave prison. Including such offender learning within “train to gain” means that it will now be possible for an employer who is prepared to take on an offender to get their training paid for once they have left the prison estate. That could make a big difference to future reoffending rates, and it should more than justify the investment involved.

Does my right hon. Friend agree that unlike the Opposition, who wrote off huge chunks of my constituency with the closure of the mining industry, these proposals will continue to extend people’s opportunities not only to get into work but to undertake vocational training and to upskill, and that that is important not only for individuals and their communities but for the economy as a whole if it is to prosper?

My hon. Friend is absolutely right, both about the historical attitude of the Conservatives and in recognising that the statement says that the world has changed and moved on. When we came into power, we had to deal with the backlog of people who had previously been written off and the backlog of a party that had said that mass unemployment was a price worth paying. Today, the issue has changed. Unless we raise skill levels not only for people who are still workless but for millions of people in work, we will not be able to be a prosperous country in the future, nor will we be able to ensure that nobody is left out. The challenges have changed; today’s announcement is about how we will meet those challenges.