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Jobcentre Plus (Wales)

Volume 530: debated on Tuesday 21 June 2011

Motion for leave to introduce a Bill (Standing Order No. 23)

I beg to move,

That leave be given to bring in a Bill to require the Secretary of State to make provision for the transfer to the Welsh Government of certain functions relating to the work of Jobcentre Plus offices in Wales; and for connected purposes.

The Bill’s aim is to devolve responsibility for elements of Jobcentre Plus’s work in Wales to the Welsh Government. I am grateful for the support I have received from Plaid Cymru and the Scottish National party, the Alliance party, the Liberal Democrats, the Green party and the Labour party.

The argument for the measure is straightforward. The Welsh Government have responsibility for education and training under the Education, Lifelong Learning and Skills portfolio, and for the economy under the Business, Enterprise, Technology and Science portfolio. They operate a large-scale programme of social inclusion in particularly deprived areas, one aim of which is to improve employability. Jobcentre Plus will work through the Work programme with large numbers of Welsh people who are looking for work, but the responsibility for that activity in Wales lies with the Government here. I think that getting unemployed people back to work would be more effective, better organised and co-ordinated, and that accountability would be much stronger, if that was the Welsh Government’s responsibility, working closely of course with the Government in London.

It would be up to the Welsh Government to determine how to organise matters, but elements of a possible model might be derived from Northern Ireland, where the Department for Employment and Learning works to promote learning and skills, to prepare people for work and to support the economy. Its objectives are to promote economic, social and personal development through high quality learning, research and skills training, and to help people into employment. It works with individuals to improve their skills and qualifications, with those who need support and guidance to progress their employment, including self-employment, and with businesses in the public and private sectors.

Some of the Department’s key activities include: enhancing the provision of learning and skills, including entrepreneurship, enterprise, management and leadership; increasing research and development, creativity and innovation; developing and maintaining a framework of employment rights and responsibilities, and, crucially, helping individuals acquire jobs, including through self-employment, and improving the links between employment programmes and skills development.

All that offers many elements that we could adopt in Wales to tailor a comprehensive employment service, better suited to the needs of our country. That need, I am sorry to say, is great.

I am glad that unemployment in Wales was lower in the last quarter, but it still stands at 115,000 people or 7.9%, with the United Kingdom level being 7.7%. The number of jobseeker’s allowance claimants increased in the last quarter by 1,700 to 72,000, and total employment was up at 1,349,000.

However, the number of economically inactive Welsh people stands at 480,000, including many older people, who find it particularly difficult to find a job. They represent 25.3% of the working-age Welsh population, compared with 23.3% for the UK as a whole. Most tellingly, 77,000 Welsh people have been without a job for 10 or more years. The need is indeed great.

My aim in the Bill is therefore to integrate better learning, skills and development and job finding, education and social action, enterprise and self-employment in Wales, all under the Welsh Government, to fashion them into a better organised and more coherent form. That change would help unemployed people build on their individual skills and find relevant and worthwhile employment that meets their needs and those of society. It would also help to promote Welsh business and enterprise, by working with the grain of the system of Welsh government in a simplified, one-stop model. Essentially, this is a common-sense matter of improving co-ordination and delivery, and of locating the task at the most local level where it can be best carried out.

I have concerns about the current system, and particularly about the Work programme. Currently, job seeking is all too often associated negatively in the public mind with claiming benefits. That creates a negative and often stigmatising view of the process, when it should be part of our wider contract between people and communities. We should assist in the provision of work, which allows people to pay taxes and contribute to the wider society. There is no reason why that negativity should be so, particularly if job seeking is linked with positive activities such as providing education and training, and enterprise and development. Job seeking could and should be viewed as positively as entrepreneurship is viewed.

Jobcentre staff do a difficult job in hard circumstances. It was difficult enough running the new deal in good times, but now times are very much harder. It is not simple or easy to find employment, especially for people who have been out of work for a long time and those who face a disability of some sort. We have many such people in Wales. People fear that, under the Work programme, some severely disadvantaged people will not be helped because there are insufficient funds to meet their more complex needs. The task in deprived areas will also be difficult, because there will be few job outcomes. People fear that such areas will be sidelined.

Ministers have said that the Work programme will tackle the endemic worklessness that has blighted so many communities for decades, but I fear that insufficient account has been taken of the differences between labour markets, the different conditions that businesses, especially small businesses, face, and the nature of education and training in Wales. In Wales, much of the expertise in such matters lies with the Welsh Government.

Furthermore, in Wales, the voluntary sector and the capacity of organisations to become subcontractors in the Work programme varies enormously. I have very competent and successful third sector employment organisations in my constituency, such as Agoriad and Antur Waunfawr, but in rural Wales in general we have a preponderance of voluntary bodies that do not employ professional staff. There must be doubts about the ability of some such organisations to participate.

Interestingly, Neil Lee, a senior economist at the Work Foundation, has pointed out that the

“Work programme is based on a national payment structure and does not take into account local and regional variations in labour demand…There is the danger that private contractors will focus on investing in places where they are more likely to get people into work to secure a return on investment.”

There are many such places in Wales, most notably the Rhondda, where I believe there is one job for every 120-odd people seeking it.

Be quiet.

The financial risk could be passed down to small, local voluntary sector organisations, which could be knocked out of the market as a result. There is a real danger of market failure.

Job search provisions should be devolved the Welsh Assembly, so that we can develop a Welsh solution to employment as part of a comprehensive solution to getting people into work and keeping them there. I commend the Bill to the House.

It gives me no pleasure to oppose the Bill, because the hon. Member for Arfon (Hywel Williams) is not only my constituency neighbour but my MP. I thought long and hard before deciding to oppose the Bill, but ultimately I believe strongly that it is a diversion from the issues facing us in the reform of the welfare state. The Government are currently introducing real and significant changes to the way in which we approach the welfare state and, more importantly, the way in which we deal with economic inactivity in Wales, and my concern is that the Bill would divert us from the need to ensure that people in Wales have the opportunity to work and contribute to society.

Despite the hon. Gentleman’s best intentions, the Bill would create confusion and a problem in establishing an equal and level playing field between England and Wales. The truth of the matter is that the Government have already embarked on a significant review of how Jobcentre Plus works, not just in Wales but throughout the United Kingdom, and I see no reason to complicate the situation in Wales. Nowhere in the United Kingdom is the need for the Work programme and changes to the welfare state greater than in Wales. Some of the figures are truly appalling. For example, the level of economic inactivity in the UK is about 23%, but in Wales that approaches 28%. In his constituency, the level is 27%, and in mine it is 25%. We need changes to the system that will create results, not bureaucratic changes moving powers from one place to another. We need results.

Economic inactivity rates are a symptom of the fact that the Welsh economy is far too dependent on the public sector. That is in no way an attack on the public sector. Many public sector workers do an immense amount of work ensuring that we have good services in our schools and hospitals, but we cannot continue with an economy in which about 70% of gross domestic product is produced by the public sector. We need the private sector to be able to play its full part in the economy, creating employment—full employment, I hope.

Some of the figures on job creation in Wales over the past year have been encouraging. That job creation is coming not from the public sector, but from the private sector, which we need to applaud. That is also a development that will be fully supported by the Work programme. The question we have to ask ourselves today is: would the changes proposed by the hon. Gentleman result in a single additional person going back to work, or would they simply lead to more confusion and further bureaucratic problems? With all due respect, I challenge him. He has in his constituency wards such Peblig where 34% of the population are in receipt of key state benefits, and the same is true in other wards in his constituency such as Marchog and Nantlle. Does he really believe that moving responsibility for Jobcentre Plus from London to Cardiff would result in a single individual moving from benefits to work? I doubt it very much.

In effect, the Bill shows the difference between the Conservative party in Wales, which believes in results, and the other parties there, such as Plaid, which believe in process. The reality is that results are what count, and in my view the Government’s Welfare Reform Bill proposals will create real change. However, we also need to think carefully about the proposal to link these major changes to the welfare state and the Work programme with the Welsh Assembly department for economic development. Economic development in Wales has, to be perfectly frank, been a basket-case since the Welsh Development Agency was abolished under the previous Labour Administration in Wales.

When the WDA was abolished we probably lost one of the most effective vehicles for private sector investment in Wales. Just last week, the Welsh Affairs Committee took evidence from Sir Roger Jones, whose description of the decision to take the WDA into the Welsh Assembly is worth quoting. He said that it was like

“being micro-managed by people who don’t know much”,

which “is a dangerous practice.”

My concern is that bringing Jobcentre Plus into the Welsh Assembly would do the same again. I wonder what benefit is to be gained by losing the expertise from Jobcentre Plus and allowing decisions to be made by Welsh Assembly officials with no previous experience of dealing with jobcentres or the Work programme. It would be a huge mistake.

The other thing we need to debate is how, in order to change attitudes in Wales, Jobcentre Plus officers and the Work programme must provide hope for people. We must provide the opportunity for aspiration to become a reality in our communities in Wales. We also need to provide support for communities and individuals wishing to get back into the work force in Wales, as well as encouraging the concept of self-reliance. I am concerned that if we move the responsibility for such major changes to the Welsh Assembly, we will create confusion at a time when we have an opportunity to create far-reaching change that will allow communities and individuals to become self-reliant, to stand on their own two feet and to contribute to society.

I am concerned by the comments that Glenn Massey made in his evidence to the Select Committee on Welsh Affairs last week. He stated that as a result of constant changes imposed by both Labour Administrations and the previous Plaid Cymru-Labour Administration, Welsh Assembly Government staff were “disillusioned”, suffering from low morale and finding it difficult to become motivated. I ask the House this question: if we want to encourage people back into the workplace, do we want that encouragement to come from staff who have been so demoralised by the Labour and Labour-Plaid Administrations, who have served Wales so badly over recent years? The situation is simple. We have here in Westminster a coalition Government who are willing to tackle the real problems faced by our communities. They are willing to tackle deprivation and to try to persuade people, for the first time in a generation, that work will pay—not just financially, but by giving people value and a feeling that they are contributing to society.

The proposed Bill would divert us from both the need for proper change and from moving things forward. I therefore urge the House to reject the proposition and support the Government’s attempt to create real change, rather than bureaucratic change.

Question put (Standing Order No. 23).