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Employment

Volume 483: debated on Tuesday 25 November 2008

With permission, Mr. Speaker, I would like to make a statement on employment. Unemployment began rising in January, as this country, like so many others, began to feel the shockwaves of the credit crunch rippling out from the banking system in the United States. Each and every job lost is a personal tragedy. Our goal is to ensure that newly unemployed people do not fall out of touch with the labour market, and we will do everything we can to bring those who have been out of a job for some time back closer to the world of work. So, we will continue to reform the welfare state to help people back into work now and to prepare them for the upturn.

Britain starts from a strong position. The number of people in work reached its highest ever level this summer—29.5 million; earlier this year, we experienced the lowest claimant unemployment level since the 1970s; and there are more than 500,000 vacancies in the economy. By contrast, in the 1980s and 1990s, claimant unemployment twice hit 3 million, and between 1979 and 1997 the number of people on incapacity benefits trebled to more than 2.5 million. We all know the human cost that lies behind those figures: communities were scarred, and still carry those scars today; and whole families were left without work, not just for years, but for generations.

For the first time since 1945, the global economy is predicted to shrink next year. No country can be immune, but all Governments have the same goal: to make the downturn as shallow and as short as possible. If this had been done in the 1990s, the recession then would have been less costly to communities, less costly for individuals and less costly for the economy as a whole. Yesterday, my right hon. Friend the Chancellor set out details of a £20 billion fiscal stimulus package to support our economy—it is the right action to reduce, as far as possible, the human and financial cost of the downturn. The money means help for small business, a timely boost to the economy and capital projects to maintain employment.

The money also means a significant boost for older people in this country; we are putting in place a basic state pension of £95.25 and an increase to the guaranteed credit, which will ensure that no pensioner need live on less than £130 a week. My right hon. Friend said yesterday that he wants pensioners to benefit as quickly as possible. As we are not able to increase the pension and pension credit rates before April, we therefore announced that an additional £60 payment will be made to 15 million people from January. That is in addition to the £10 Christmas bonus, which will be paid as normal. The measures represent a significant increase in Government support for older people, which will really make a difference to pensioners, particularly if prices fall as expected next year.

The Chancellor also announced extra help for my Department next year. That £1.3 billion package will ensure that we can respond to the higher number of people claiming benefits. Over the past decade, we have reformed the welfare state to match more support with more responsibility. Yesterday’s announcement will enable us to continue our reform of welfare, to offer real help to people in these tough times. We will be able to maintain the service we provide, and strengthen our response in three ways.

First, we need to make the right support and conditionality available. We need to ensure that Jobcentre Plus can deliver as good a service as it does today to more people tomorrow. In the past, Governments have cut back on support and conditionality as the claimant count has risen. We want to do the opposite, and do more to help people, rather than less. Over the past 10 years, we have modernised our employment services almost beyond recognition. People used to get benefits from one agency and job advice from another—now someone cannot sign on without looking for work. Jobcentre Plus takes 80,000 calls a week, and its website gets 350,000 visits a day. The National Audit Office reports that

“the Organisation for Economic Co-operation and Development found significant improvements in unemployment levels in the United Kingdom…related closely to the adoption of active job-seeking measures”.

Therefore, our first priority remains to ensure that everyone continues to receive this top quality service, and I am pleased to say that the system is coping well. Our target for jobseeker’s allowance is to process all new claims within 11½ days—in the year to date, we are processing them within an average of 10. For our crisis loans, demand has gone up, but processing times continue to fall, and budgeting loans are being dealt with 20 per cent. quicker than their target time.

But with higher levels of claimant count, we need further investment. The extra money that the Chancellor announced yesterday will ensure that we are able to maintain and expand our offer during a time of increased pressure on our services—help with CV-writing and job search, and time with personal advisers to develop action plans; to identify skills needs; and to get support with training, child care and interview techniques.

We need to ensure we have the right capacity. In the last spending round the Department reduced its staffing by 31,000 and has increased productivity overall by 12 per cent., as confirmed by the National Audit Office. We have saved money in back office processing and used that to invest in the front line. So there are now 1,500 more personal advisers in Jobcentre Plus than there were two years ago. But we need to recognise that in the current economic circumstances, we need to invest more in our front-line services, so we are today announcing a moratorium on Jobcentre Plus closures, and I can also confirm that the pre-Budget report will mean 6,000 more front-line staff in place in Jobcentre Plus next year.

Secondly, we need to ensure that we reach people facing redundancy as early as possible. The Insolvency Service now informs Jobcentre Plus immediately of redundancy notifications it receives. We had already doubled the funding for our rapid response service. Yesterday, the money available was doubled again, allowing us to help all companies facing 20 or more redundancies. That service will bring people swift access to the £100 million that the Department for Work and Pensions and the Department for Innovation, Universities and Skills announced last month to help people retrain and develop their skills, so that they can move quickly back into sustainable work, like the workers at Butler and Tanner in Frome, Somerset, nearly 300 of whom lost their job when the printers closed in April this year. With the help of the rapid response service, it is estimated that 90 per cent. have now found new jobs.

We know that local employment partnerships, which help match the unemployed to employers looking to hire, have been successful. Already more than 70,000 of our most disadvantaged customers have started work under the initiative. Now we will be able to extend that to include those who are newly redundant, too.

We have also announced the national employment partnership. This group will be chaired by the Prime Minister and will include the heads of business and public sector bodies, with a remit to ensure that employers work with the Government to enable people facing redundancy to be moved as quickly as possible into new jobs.

Thirdly, over the past 10 years, we have also opened up our service to private and voluntary sector providers. As David Freud recognised, that allows us to get the best of both worlds with Jobcentre Plus providing the core support and processing, and specialist providers helping those who find it hardest to get back into work.

Despite opposition to them from some parts of this House, the new deals have been successful, but they need to become more personal to the individual rather than being based on age, so we are introducing the flexible new deal. Some concerns have been expressed about the viability of these contracts in new economic circumstances. I am glad to report that we have compliant bids from 24 organisations and we have a minimum of four organisations competing for each of the contracts on offer. But it is important that we do invest more in the flexible new deal, both to give providers confidence but also to make sure that this time people who are further from the labour market are not abandoned. Some people say that there is no point helping people furthest from the labour market in the current circumstances. We say the opposite: when times are harder, we should be giving people more help, not less.

This Government are taking action, including action on the economy and action to help people face the effects of the global crisis. That is the right thing to do for this country, for individuals and for jobs. The £1.3 billion will help those who are newly facing redundancy and those who have been out of work for longer: more front-line staff, and more money for our private and voluntary providers, so that we can maintain our active regime. For those who have been out of work for some time, we will maintain and accelerate our overhaul of the welfare system to do everything we can to bring them back closer to the world of work. We will give more help now, to prevent individual tragedies today from becoming the scars on communities tomorrow. I commend this statement to the House.

May I start by thanking the Secretary of State for an advance copy of his statement? I listened with astonishment as he kept on trotting out all the old, discredited claims about the Government’s record on employment. Before the recession even started, their record was lamentable, despite all the boasts and all the misleading statements, such as the Secretary of State’s claim that Britain has had record levels of employment. That is just not true. Britain had a higher proportion of people in work in both the 1970s and 1980s.

The past decade has been one of wasted money and wasted opportunities. The vast majority of new jobs have been in the public sector, and not the private sector. Most new jobs have gone to migrant workers and not to British-born benefit claimants. The number of young people who are not in education or employment is 20 per cent. higher than a decade ago, despite the billions of pounds that have been spent on the Government’s mostly ineffective new deal programmes, described recently as a “calamity” by the right hon. Member for Birkenhead (Mr. Field).

Before the recession started, the number of British people in work had already fallen by more than 300,000 in three years, so things were already getting worse. The number of people claiming incapacity benefit has barely changed for a decade and tens of thousands of unemployed people were excluded from the statistics because of clever manipulation of the figures by Ministers. For 10 years, the Government did not fix the roof when the sun was shining. Ministers have left themselves to run a marathon with holes in their shoes before they have even crossed the starting line.

We are now seeing jobs axed at a rate of more than 2,000 a day and we have the fastest rising unemployment since 1992. The OECD says that that will get worse and that unemployment will rise faster in Britain than in any other G7 country. Even the pre-Budget report yesterday forecast steeply rising unemployment—small wonder that the DWP needs more money to cope with the challenge.

No doubt that will help with the moratorium on jobcentre closures—what a farcical announcement that was. The Government have closed 492 jobcentres since 2002, and since unemployment started to rise in January they have closed a jobcentre a week. Guess how many they were planning to close next year? Three. Some moratorium. They have already nearly finished the closure programme.

With what else does the Secretary of State meet this tremendous challenge? Another committee, chaired by the Prime Minister. What a relief that will be to the thousands of people who are nervous about their jobs. There is no help for the large numbers of people in our smaller firms who face redundancy. The business tax cuts, designed to help smaller companies, are due to last for one year, even though the Government say that unemployment will continue to rise into 2010.

The Secretary of State boasts about the flexible new deal without saying that it will not even start for another year. Will he confirm that under the flexible new deal young people will have to wait 12 months and not six before they are eligible for new deal help? He could have announced the suspension of the rules that stop people retraining. We asked for that two weeks ago, so will he now take up our proposal to allow all jobseekers to train immediately rather than having to wait to be referred to the new deal? Have the employers joining the national economic partnership specifically committed to creating new jobs? If so, how many have done so? How will the Government ensure that small businesses that are considering making redundancies are aware of the rapid response service and will make use of it?

Why did yesterday’s statement not contain a real employment programme with incentives to employers to take on new staff of the kind for which we have called? When we launched our proposals, the CBI described them as “imaginative” and said that they would help

“small businesses keep people in work”.

The Secretary of State has announced today a sticking-plaster solution to the biggest challenge that we face as a nation. Unemployment is set to rise sharply and the Government have no idea of how to deal with it. They have wasted 10 years of opportunity and are now out of money and out of ideas. Ten years ago, the Government inherited an unemployment rate that was falling fast. It looks as if they will do just the opposite for their successor.

That was absolute confirmation that the Tories are now the do-nothing party. We are offering real help to people in difficult times. Those on the Opposition Front Bench have absolutely nothing to offer people because they are setting themselves apart from the orthodoxy around the world that we need both monetary and fiscal action now to help the economy. The right thing to do is to ensure that the problems with the economy are as short and shallow as possible, to reduce the cost to people now and to the economy in the long run. That is exactly the opposite of what the Tories did in the ’80s and ’90s, when they said that unemployment was a price worth paying. They wanted us to believe that they had learned those lessons, but even this week the shadow Health Secretary said that a recession

“on many counts…can be good for us”.

We have the Conservative deputy chairman saying that the recession should take its course. The only thing that we need to know about the Conservative Front Bench is that its members have not learned the lessons of the 1980s and 1990s, when they massaged and fiddled the unemployment figures and put millions of people on to incapacity benefit rather than helping them. In the middle of the 1980s, there was no requirement that people look for work. The then Conservative Government did not provide support or reform the welfare state as they should have done, but those are exactly the things that we will continue to do.

I turn now to the points made by the hon. Member for Epsom and Ewell (Chris Grayling). He trotted out his list of figures but, as I mentioned when we last discussed these matters, they are rather esoteric interpretations of the facts. He said that more public sector than private sector jobs had been created, but that is simply wrong: three quarters of the jobs that have been created are in the private sector. He said that we had a lamentable record on employment, but we had the second-highest level of employment in the G7—second only to Canada.

The hon. Member for Epsom and Ewell said that we were not going to act on unemployment, but we are proposing a package today that his party would not have proposed in the past, and could not propose today, because it is ideologically against taking action now to help people through the downturn. The Government will act because we understand the scars that the Conservative party left on communities, and we are determined to make sure that that never happens again.

I welcome my right hon. Friend’s statement today, but does he agree that it is as important to keep people in work as it is to get them off benefits and back into work? In respect of the Government’s response to Dame Carol Black, 300,000 people a year move from work to incapacity benefit, so is it not time that we dealt with the anomalies and inefficiencies of statutory sick pay? Should we not address that as an issue in the first six months of sickness, rather than wait until 12 or 18 months down the line?

I am glad that my hon. Friend welcomes that report and the Government’s response to it, and he is right that we need to look at the incentives open to employers. He will have seen in our response that we want to work with employers, and we will be happy to work with his Committee on how we can change the incentives for people. We must make sure that every part of the system has the right incentives to keep people in work, because we know that being in work is, in the main, good for their well-being. It is not in the interests of individuals, employers or the Government for people to fall out of work if they can stay in work.

Our response today makes a significant advance in addressing Dame Carol Black’s points, but we are happy to look at whether an even more fundamental change to people’s incentives is possible. We would be happy to work with my hon. Friend’s Committee on that.

May I also thank the Secretary of State for giving notice of his statement? I also welcome the moratorium on jobcentre closures although, as the shadow Secretary of State said, few were planned for next year. In view of that, and of the rising unemployment in certain areas, does the right hon. Gentleman have any plans to reopen closed jobcentres, especially in rural areas or areas where there are unemployment hotspots? Since December, the number of jobseeker’s allowance claims has risen from 30,000 to 66,000. Is the Secretary of State planning to use the additional staff to ensure that the processing of claims is improved?

We were told earlier this year that there would be a review of the social fund. One consequence of people who become unemployed facing delays in processing and the two-week delay in payment is that they have to apply for a crisis loan. When will he announce the results of the review, and is he going to employ more staff to process those social fund loans?

I agree that engaging with employers is an important part of the job of Jobcentre Plus, but under the flexible new deal people have to wait 12 months before they get intensive support. They have to wait six months for basic support, yet the Freud report said that early intervention was essential, especially for vulnerable people. Does the Secretary of State have any plans to change the flexible new deal, so that intervention can take place much earlier, especially for vulnerable or young people?

Finally, one consequence of yesterday’s PBR was that some investment in public sector schemes will be brought forward. What discussions has the Secretary of State had with other Departments, such as the Department for Children, Schools and Families or the Department for Transport, to ensure that employers getting the contracts for those schemes are encouraged to take people off the unemployment register?

I am sure that the hon. Gentleman will welcome the fact that it is actually 25 Jobcentre Plus offices that will be affected. I was slightly perplexed by his reference to rising processing times because they are within target and have been falling. Thanks to Jobcentre Plus staff, who have been working overtime and opening at weekends, we have maintained the service to which we are committed. We could not do that without extra investment next year, which is why the money coming in now is so important. It is the same for budgeting loans and crisis loans. We process crisis loans within two days, which is again under our target. It is important that we maintain those processing times because it is clearly important for people to get their money as quickly as possible.

The hon. Gentleman is right to say that we are looking at the social fund. We commissioned a report from KPMG on it, and we will make proposals shortly. There is probably some agreement around the House that, if we can use that money to improve people’s financial skills and give them the help to bridge their way through difficulties and get back into work, that will be a very good thing.

We obviously want to make sure that the flexible new deal is effective. The proposals that we will make build very much on David Freud’s recommendations. He said that the new deal should work effectively, but having separate new deals for disabled, older and younger people meant that we were treating people according to their category rather than their personal circumstances. The flexible new deal frees providers to do what they do best, which is to innovate, and rewards them according to their achievements. The better they do, the more money they will get and, again, the money that we have announced today means that we can cope with the higher volumes and give providers confidence that we will be able to do that.

We keep under review whether we should fast-track people on to the flexible new deal. People in many of the categories that the hon. Gentleman mentioned can already volunteer to go to that stage and young people who have been out of education or training—NEETs—can and will be fast-tracked to the intensive stage of Jobcentre Plus help and then on to the flexible new deal. We will keep that under review.

It is important to say that the rapid response service and the £100 million allows that help to be provided to people even before they fall out of work, so the hon. Member for Epsom and Ewell was wrong to say that people have to wait to get trained; they do not even have to be unemployed to get training because they can get access to it before they fall out of work. The earlier we help people, the easier it is to ensure that they find their next job.

As the Member of Parliament whose constituency under the Conservatives was No. 1 in Great Britain for long-term unemployment and No. 1 in England for youth unemployment, may I thank this Government for the new deal, which the Conservatives opposed and the funding of which the Liberal Democrats opposed? Employment in my constituency has been transformed by the new deal and the local employment partnership, which has just provided 130 jobs at the new Tesco in Gorton. The direct training centre is training men and women to be builders for the new increase in building that will result from the Government’s policies announced this week.

My right hon. Friend is right that the new deal has had a fundamental effect on unemployment. It has reduced long-term unemployment by three quarters. As he says, unemployment was one of the scars left from the 1980s, which he remembers so well.

The problem that would occur under the Opposition’s policies is that they would have to cut programmes, slow welfare reform and reduce the help available to people, because they are against the extra money that the Government put in yesterday.

Like so often, the headline announcements by the Government do not bear close examination. It is all very well announcing a moratorium on jobcentre closures due next year, but it is not much good to my constituency, which saw all three of its jobcentres close in January in Sidmouth, Exmouth and Axminster. Will the Secretary of State pledge today that he will re-examine whether there is a genuine case to reopen jobcentres, especially in deprived areas? Two of my wards in Exmouth—Town and Littleham—are in the upper quartile of deprivation on the national indices. Will he look at whether there is a genuine case for reopening jobcentres where they are needed—close to the people who need access to them?

I can give a guarantee that we will provide the service that people need. That is our commitment. We deliver services now through Jobcentre Plus, children’s centres, GP surgeries and other community settings. If there are ways in which the hon. Gentleman thinks that we should improve the service in his area, I shall be happy to listen to them.

It seems perverse that at a time when there has been a severe contraction in the construction industry, Eaga, which is responsible for implementing the Government’s warm homes programme, just last week said that any household in fuel poverty which applies for assistance will not be able to get it until the end of this winter because it does not have enough qualified people to deliver the upgrading of properties and the replacement of heating systems. Will my right hon. Friend ask the Prime Minister, in the new partnership committee that he is considering, to seek ways of dovetailing local ownership of identifying where we have work that needs to be done this winter with the availability of the skills that need to be harnessed to deliver the upgrading work?

I can give that guarantee. Indeed, one of the things that we have discussed is how we can ensure that the UK can capitalise on the opportunity offered by the initiative that my hon. Friend mentions in particular, and green jobs in general. There are significant opportunities for jobs growth in that area, and I am working with many Departments, in particular the Department of Energy and Climate Change, to make sure that we achieve that.

The Secretary of State has announced a national employment partnership, a group to be chaired by the Prime Minister. Will that not be just another talking shop?

There was a similar scepticism when the then Chancellor, who is now the Prime Minister, announced local employment partnerships, yet they have helped 70,000 of the hardest to reach people into work. We are now saying that we want to ensure that that initiative is available to people who have recently been made redundant as well. We think that it is right to work with many of the larger organisations, such as Whitbread, Asda and Tesco, which have been very supportive of that, and have ensured that they offer people work trials and guaranteed training. If we can make our system as flexible as possible so that people are ready to go into work, and employers can play their part in saying that they will take people on as quickly as possible, we can help to fill those half million vacancies and reduce the effect of the downturn on our economy.

In the 1980s the west midlands was devastated by unemployment. Does not today’s statement demonstrate that, in contrast to what happened then, those who lose their jobs now will not be treated with indifference and contempt? If politicians do not want to lose their jobs, neither do our constituents.

My hon. Friend is right, of course. What he will see from this Government is real action, as I said. What we saw from the Conservative Front Bench was a scheme, to which the hon. Member for Epsom and Ewell referred, which fell apart within a day of being announced. The Institute for Employment Studies said that the scheme was almost 100 per cent. dead-weight, and the Federation of Small Businesses said that it would be a disincentive to hiring people who have recently become unemployed. It is because the Conservatives were not prepared to spend money in the downturn that they had to squeeze the scheme to the point of pretending that it did not cost any money. That is the difference between us. We are prepared to take action. They are not prepared to do anything to help people.

On the brink of the biggest economic downturn the world has seen since the 1930s, does it make sense either morally or economically to compel single parents to chase non-existent jobs in a deteriorating labour market, and threaten to reduce their benefits by up to 40 per cent. if they do not? Cutting automatic stabilisers in the midst of a recession is the mistake that the National Government made in 1935 when they introduced the means test. The Labour party then opposed Conservative policies. Why are they implementing them now?

That is the opposite of what we are doing. We are making the automatic stabilisers work even better. That is why we have announced an extra £60 in the Christmas bonus for pensioners. That is why there is a significant uprating of the pension—the biggest that we have had under this Government. That is why we are bringing forward child benefit increases. That is exactly why we have a £145 tax cut for people. Those things are making the automatic stabilisers work.

Surely if we can get even one extra lone parent into work because of that support, that is a good thing. If, as we believe, we can get more than 70,000 more lone parents into work, that is families helped and lives transformed. We do not penalise people for not finding a job. We know that our support works, and we want people to take it up. That is why the system was created as it was. Ever since 1911 there has been conditionality in the system, and that is exactly what we will continue to have.

May I inform the Secretary of State that I was a marcher on the people’s march for jobs in 1983, when more than 3 million people were unemployed and the Tories did absolutely nothing about it? They were the do-nothing party then, and they are the do-nothing party now. I welcome the Government’s proactive stance, but people who are employed in a company with fewer than 20 people may become unemployed and have no real experience of the benefits system. How will the extra resources be used to make them familiar with, and less fearful of, the process?

The rapid response service will be available to any company, making whatever level of redundancy, if they want to contact us. We guarantee that we will contact any company with more than 20 redundancies, and what my hon. Friend suggests is exactly what we will do: we will go in there and help people understand the benefits system and what they are entitled to. We will also, I hope, try to get them back into work before they have to sign on, by helping them look for work and with retraining, and by doing exactly as she suggests.

Aearo Technologies, a subsidiary of 3M, based in Poynton in my constituency, is taking 90 jobs to Poland. AstraZeneca, the largest employer in my constituency and essential to this country’s economy, is shedding more than 1,250 jobs over three years. The reason that it gives is uncompetitiveness in this country and the importance of the competitive global market. How will the increase in national insurance improve the situation?

How would cutting back public spending now, in the middle of a downturn, improve the economic situation? That is the folly of the Opposition’s policy: they would introduce fiscal tightening in the middle of an economic downturn. We propose to help the economy in the short term, and to make the downturn shallower and shorter, so that when the economy starts to grow, we can credibly say that we will live within our means and return the budget to stability. That is absolutely the right thing to do.

I am pleased that Belper jobcentre is staying open, because although it is the constituency of West Derbyshire, it helps a number of my constituents. I also welcome the extra resources for the rapid response service to help those facing redundancy. But, to clear up any confusion, will my right hon. Friend confirm that the service is available not just to the private sector, where it has proved invaluable in the past, but to public sector organisations, such as Tory-controlled Amber Valley borough council, which is planning a large number of redundancies because of its complete financial incompetence?

Can the Secretary of State tell us what the following constituencies have in common: Birmingham, Hodge Hill; Bolton, South-East; Bolton, West; Bury, North; Eastleigh; Halesowen and Rowley Regis; Islwyn; Leicester, East; Leigh, Milton Keynes, South-West; North-East Milton Keynes; Rossendale and Darwen; South Swindon; Corby; Kettering; and Wellingborough? If he does not know, I can tell him that unemployment is higher there now than it was in 1997.

I am not sure what the hon. Gentleman’s question was, but the facts are that unemployment hit 3 million twice under the Conservative Government, that it was 1.6 million when we came into power, and that it is under 1 million now.

May I tell my right hon. Friend that in Edinburgh, South in 1997, 2,037 people were languishing on the dole, but that this summer, thanks to the efforts of the new deal and this Government, that number fell to 667? I feel sorry for my right hon. Friend, because I know that he was waiting for an apology from the Opposition Front-Bench team for their policies of mass unemployment in the 1980s and 1990s, which they would bring back in this century.

My hon. Friend is right, and judging by the comments of the shadow Health Secretary, it seems that they still have not learned their lesson.

Unemployment in my constituency has risen by 21 per cent. in the past year. Jobs have been lost in the manufacturing town of Thetford, and more are at risk. What would the Minister say to employers in my constituency, who fear that the proposed cut in VAT will do little to stimulate demand for British goods and preserve jobs in the manufacturing industries?

There is a £12 billion stimulus to the economy, and we very much hope that that will help the hon. Gentleman’s constituents. If any of them are at risk of losing their jobs, we clearly share his worry about that. The rapid response service is there to help people if they do lose their jobs, but the whole point of yesterday’s pre-Budget report was to ensure that that is less likely. It included £7 billion of help for small businesses.

People in Chapeltown in my constituency will be very relieved today to hear that their jobcentre is one of the 25 that will remain open, but will my right hon. Friend also consider developing employment support services in the jobcentre, alongside the housing service and the voluntary sector, so as to serve better the needs of the long-term unemployed in that area?

We are certainly happy to consider that. As my hon. Friend knows, we are rolling out a new approach whereby people will be able to claim from Jobcentre Plus not only their benefits but their tax credits and housing benefit. They will be able to go to one place and get the information sorted out through one organisation, rather than through many different ones.

The Secretary of State questioned the statement, made by my hon. Friend the Member for Epsom and Ewell (Chris Grayling), that two thirds of all new jobs are being created in the public sector. However, that was also a lead story in The Sun today. Has The Sun got it wrong?

As I understand it, the Office for National Statistics has made it clear that three quarters of jobs are created in the private sector.

I congratulate my right hon. Friend on his announcement that planned jobcentre closures, including that of the one at Shepherd’s Bush, will not proceed. That Shepherd’s Bush jobcentre is literally next door to the Westfield shopping centre, which has created 7,000 new jobs. However, the Tory council, which should have negotiated the employment benefits, has admitted that only 268 of the jobs are going to local people, and it has itself just issued redundancy notices to 4,700 people. Will my right hon. Friend assure me that the reprieved jobcentres will get the resources to help my unemployed constituents, whom the Tories have clearly abandoned again?

Absolutely. I pay tribute to my hon. Friend and other colleagues who have campaigned so hard for this announcement. He is right to say that the extra investment is needed, and the £100 million that we have said will be available will help his constituents, among others, to get exactly that help.

I welcome the statement and thank the Secretary of State for all that he is trying to do. Many thousands of my constituents are specialised, highly skilled finance and banking workers in the City. Their sector has been particularly hit by the credit crunch. Is there anything special that we can do to help them if they are made redundant?

Absolutely. The £100 million is there to get to people even before they lose their jobs. People may have banking skills that are highly transferable to other areas. With a little bit of quick retraining, we may be able to get such people back into work even before they fall out of work. If they do sign on for benefits, I should say that we give exactly the same priority to services for people with professional backgrounds as we give to services for people from different backgrounds.

I welcome the statement on the extra measures that the Secretary of State has taken. However, the moratorium on jobcentres will come too late for Burslem. Will he revisit the whole issue of how we can get the skills match and the front-line staff needed to help with regeneration and the whole job market? Will he meet me to see how we can achieve more in Burslem?

We are happy to consider how we can deliver the service. As my hon. Friend knows, we have modernised it so that there is now one agency, Jobcentre Plus, where before there were two. We take 80,000 calls a week and there are 350,000 visits a day to our website. That is a way of making sure that we help people. If my hon. Friend feels that more is needed, we will be happy to discuss that with her.

Does not the Secretary of State’s announcement of a major increase in spending on the flexible new deal for the long-term unemployed show that he is predicting a major increase in long-term unemployment? Does he agree with the Social Market Foundation, which has said that in the course of this recession, long-term unemployment—of more than 12 months—is set to quadruple?

Unemployment has fallen by three quarters since 1997. We do not predict unemployment levels. Obviously, we look at the independent predictions of independent experts, but it is not for the Government to make predictions of that kind.

I welcome the statement made by my right hon. Friend today. However, will he look into a particular aspect of the situation of people who have lost their jobs? They are in a bad situation, but the most disheartening part of being unemployed is finding a vacancy, only to discover that it was filled two weeks earlier, although it is still being advertised at the jobcentre. Will my right hon. Friend try to ensure that people do not waste their time in that way, that the employers who advertise in jobcentres notify them straight away when vacancies are filled, and that the jobcentres take down the notices about jobs that have been filled?

That is absolutely right. We depend, of course, on employers telling us when a vacancy has been filled. One of the things that the extra investment will do is to allow more people to work with employers, to get as many vacancies as possible advertised through Jobcentre Plus, so that they can respond to my hon. Friend’s point.

The Government were very sympathetic to workers at JCB who accepted a reduction in pay in order to try to remain competitive and keep their jobs—but that flexibility is not available to people on the minimum wage. Will the Government extend the same flexibility to people on the minimum wage, so that if they choose to accept a lower wage in order to retain the right to work, they can do so?

I think that we saw some Members nodding at that. That exposes the true face of the Conservatives, who opposed the minimum wage and said that it would cost 2 million jobs—yet in fact there are 3 million more jobs in the economy.

I welcome my right hon. Friend’s statement. Will he ensure that the rapid response service goes for early intervention on skills training, so that if there is even a hint of redundancy in even the smallest firm, people start thinking about skills training as opposed to just looking at adverts for another job, so that this time a redundancy notice for any person may be seen as a chance to upgrade their skills—unlike what happened last time under the Tories, when people were left stood in dole queues and at home without hope?

I absolutely can give my right hon. Friend that guarantee. That is exactly what the rapid response service does. The hon. Member for Epsom and Ewell was wrong to say that people cannot train when they are on jobseeker’s allowance. He should read the Green Paper, which makes it clear that we have abolished the 16-hour rule where people are training to get themselves back into work.

More than 250,000 young people have already been through the new deal twice, and 80,000 have been through it three times. What does the Secretary of State propose to do to ensure that the new deal genuinely prepares people for work? Is it not just a revolving door that keeps them off the register of the long-term unemployed?

The National Institute of Economic and Social Research, an independent organisation, has said that the new deal pays for itself, and it has helped to cut long-term unemployment by three quarters. We are reforming the flexible new deal on the lines that David Freud suggested, using private and voluntary providers, giving them the freedom to innovate, and rewarding them on the basis of results. Although the Conservatives say that they are against that, it is exactly the approach that they say that they would follow as well.

I welcome the additional 6,000 staff in the jobcentres. Was that figure calculated on the basis of a ratio between staff and the numbers of unemployed? If so, will there be an automatic increase in staff beyond that 6,000 if the numbers of unemployed go up beyond the Government’s current expectations?

Clearly, we use a range of scenarios and base our plans on that approach. I can give my hon. Friend my commitment that we will ensure that the service delivers for people’s needs, and we will do that not only by investing more but by continuing our efficiency programme, which has enabled us to shift resources from the back office to the front office and to increase the number of personal advisers by 1,500.