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Unemployment

Volume 481: debated on Monday 20 October 2008

The jobseeker’s allowance count rose last month to 939,900. There are 608,000 vacancies in the economy and 80 per cent. of claimants leave jobseeker’s allowance within six months. We do not predict future levels of unemployment, but we have been planning for the impact of higher levels of jobseeker’s allowance claims in the coming months.

As I understand it, the rise in unemployment announced last month was the biggest in a decade, or two decades. To link my question with Question 2, there is some confusion about what the immigration Minister last week on reducing the number of immigrants because of employment problems. To return to that question, which the Secretary of State’s colleague failed to answer, could the right hon. Gentleman give an update on the Prime Minister’s policy of British jobs for British workers?

We absolutely want to train workers so that they can get jobs, improve their skills and get more money through employment. About half of the increase in employment has gone to UK nationals. We have a flexible labour market, which is important for the UK. I did not realise that the Opposition were against the idea of a flexible labour market.

This morning I was informed by Network Rail that trying to rush forward the £500 million upgrade of Reading station in my constituency would be problematic. It could lead to poor planning and mistakes, and it would make little short-term difference to unemployment. Does the Secretary of State agree that trying to bring forward big capital projects such as the one at Reading station is not the answer to unemployment, and that continuing a policy of reckless spending will do damage to unemployment?

The hon. Gentleman is welcome to campaign against investment in his constituency if he wants to. All I can say is that it is a very odd approach.

Does my right hon. Friend agree that one of the worst experiences our constituents can suffer is to be denied employment? Is it not essential that every help and assistance is given to them, unlike what occurred in the ’80s and much of the ’90s? A public work programme, which the Government are encouraging, is essential to help people to avoid the poverty and destitution that so often come with unemployment.

My hon. Friend is right. We need to help people to find work if they do lose their job. We are not talking about a statistic, but someone’s life, which is why there are more than 1 million visits to our website every day, and why we take more than 70,000 calls and have more than 45,000 interviews to help people to get back into work. There is excellent support for people who need child care, and help for people who need a suit for an interview and advice on interview techniques. We will continue to do those things. The Opposition abandoned people during a downturn; we will protect them, and prepare them for the upturn.

The Secretary of State will know that the parliamentary group on the Public and Commercial Services Union, which I chair, has expressed its concern about job cuts in the Department for Work and Pensions. There have been 30,000 already and another 12,000 planned, with 2,000 jobcentres potentially at risk. May I ask the Secretary of State to consider a moratorium on those job cuts, and to review the future job strategy in the Department? Many of us fear that the rise in unemployment will overwhelm the service if he does not address the issue.

I hope that my hon. Friend will agree that we will do better than that. We are taking on an extra 2,000 people to introduce the employment and support allowance, and we will keep them on to help with job claims, so we are responding to that. We have been planning for a while to ensure that we can cope with the higher inflow level, and it is also important that we have an efficient system. We have moved people from dealing with paper-based systems in back rooms to helping people with claimants in front rooms, making sure that we have more investment in the front line. That is why we process claims much quicker than we used to—people get an appointment within three days.

We need to continue to improve the efficiency of the system, which is why, for example, we announced last week that people throughout the country can claim their benefits, tax credits and housing benefits at Jobcentre Plus in one visit, instead of having 28 previous contacts, as before. That is a more efficient system, and one that is better for claimants.

As the Minister will know, the media recently reported that as we head into a recession welfare-to-work contracts are becoming less attractive to potential bidders and therefore potentially more expensive to the Department. Meanwhile, the flexible new deal will become increasingly important as more people are out of work for longer. What is being done to ensure that bidders for the flexible new deal have accurate information about the number of people whom the Department considers can be helped back into work during a recession, and that funding structures deliver support where it is really needed, helping those who are furthest from the job market to return to work—which they will find particularly tough at a time when unemployment is rising?

The hon. Lady will be glad to learn that we met the potential bidders recently and discussed precisely that issue. It is important to note that they are bidding for five-year contracts, which will extend over an economic cycle. It is up to them to decide what proposals to submit and the levels at which they bid. However, the fundamental point is that we are spending £500 million more on this than we were in 1997, when the JSA count was 1.6 million compared to the present figure of just over 900,000. That means that more help is being invested per person than in 1997.

I thank God that this party is in government, rather than our opponents. Many of us will remember what the position was like in the 1970s, when whole communities were decimated and there was no help for the unemployed.

I congratulate my right hon. Friend on the incentives he is providing to ensure that when people are made unemployed, there is a route for them to take. Will he now confirm his commitment to the Train to Gain programme, and to the other programmes that are desperately needed by people who lose their jobs? Unlike the past—

My hon. Friend is absolutely right. We are increasing the protection that we are providing. We are giving people more and earlier help with their mortgage costs, and, if other parties in the House are happy to co-operate, we shall want to make the changes in January. That would mean shortening the consultation procedure by a certain amount, but if people consider such action right at a time of financial turbulence, we propose to take it.

We want to give people more help in redundancy by providing better training for them. That is why we announced another £100 million to help people to return to work. We will not repeat the mistake of the 1980s by abandoning people, fiddling the figures and leaving them on benefits and without support.

One of the early and most obvious indicators of a slowdown is the state of the building industry. My constituency lost 50 jobs recently at Rehau Ltd, which makes unplasticised polyvinyl chloride goods for the building industry. We have also lost a firm called Action Makers, who are steel erectors. May I urge the Secretary of State to liaise closely with his Cabinet colleagues, and introduce measures to kick-start the building industry in both the public and the private sector?

The hon. Gentleman is welcome to do that—and, indeed, we are taking such action already. The authorities have introduced a programme very similar to ours to help those who will be made redundant. It is a very good programme, helping people to retrain and return to work quickly. Hon. Members can also play a part in ensuring that if there are redundancies and Jobcentre Plus does not offer help immediately, they can do so. We have organised a very good system involving a rapid reaction force which helps people even before they fall out of work, and which provides a role for all hon. Members.

If the labour market does become still more competitive, will my right hon. Friend look closely at the needs of people with disabilities who want to enter it? We must maintain our core principles of equality in the labour market, and never use people with disabilities as a statistical convenience to reduce the employment figures.

My hon. Friend is absolutely right. There are 600,000 vacancies in the economy. It is important for us to help people who have just lost their jobs to get back into work, but also to help people who have been out of work for longer than that, and people with disabilities. My hon. Friend will be pleased to learn that for that reason we are doubling the budget for Access to Work, which pays the extra costs of employing someone who is disabled.

First, may I make it clear that we share the concern that has been expressed in all parts of the House about the rise in unemployment, and that we want appropriate help to be brought as quickly as possible to the newly unemployed? To return, however, to the contribution of the Minister for immigration on this subject just last week, and the connection he chose to make, in his own way, between unemployment and immigration, will the Secretary of State simply tell us whether there is any change in Government policy in this regard? A yes or no answer would be helpful.

As the hon. Gentleman knows, we have been developing the points system since the last election. It will help to make sure that vacancies that can be filled from the UK labour market are filled from it. It is important that we help people to get back into work. That is why the Train to Gain budget and the flexible new deal matter, and that is what we are focusing on.