Second Standing Committee on Delegated Legislation
Monday 8 November 1999
[Mr. Nicholas Winterton in the Chair]
Draft Jobseeker's Allowance Amendment (New Deal) Regulations 1999
4.34 pm
The Minister for Employment, Welfare to Work and Equal Opportunities (Ms Tessa Jowell): I beg to move,
That the Committee has considered the draft Jobseeker's Allowance Amendment (New Deal) Regulations 1999.
The Chairman: With this it will be convenient to consider the draft Jobseeker's Allowance (Amendment) (No. 2) Regulations l999 and the draft Social Security (New Deal Pilot) Regulations l999.
Ms Jowell: Mr. Winterton, I begin by saying what a pleasure it is to serve under your chairmanship to consider these three sets of regulations and I thank the hon. Member for Buckingham (Mr. Bercow) for agreeing to consider them together, which makes good sense.
I shall take the Committee through the provisions of each set of regulations in turn.
The first set of regulations are concerned with the education and training opportunities within the national new deal for people aged 26 and over. At present, to be eligible to benefit from these opportunities, people have to have been in receipt of jobseeker's allowance for at least two years. However, the effect of the current regulations is to exclude people who are unemployed and claiming jobseeker's allowance but who are not actually receiving any benefit and only receive their national insurance contribution credits, for example, because they have a partner who is in a well-paid job. The regulations before the committee today correct that anomaly and will enable people who are only receiving their credits to take advantage of the help that is on offer, if they wish to do so.
The second set of regulations are rather technical, but their purpose is to ensure fair treatment of certain groups within the benefit system. They serve three purposes: first, they correct a defect in the current regulations and ensure that people are able to move smoothly to JSA if they have previously been claiming incapacity benefit and are then found to be capable of work by the all work test. At the moment, the process for notifying people that they are no longer eligible for incapacity benefit risks leaving them unable to claim JSA for a few days. The regulations will put that right. Secondly, they correct another defect in the current regulations and in doing so make sure, as originally intended, that prisoners who are released from detention and then claim JSA are given up to a week to re-adjust to normal life, by treating them as if they are meeting the labour market conditions. Thirdly, these regulations make a technical amendment to ensure that references to training and enterprise councils also cover chambers of commerce, training and enterprise, which were formed when some TECs decided to merge with local chambers of commerce. We have already changed these references in other places in the legislation, but had to wait for an opportunity to make the change in regulations covered by positive resolutions.
I want now to focus on the pilot regulations, and I make it clear that our policy intention is unchanged. The powers in the Jobseekers Act 1995 mean that pilot regulations can last only for 12 months. But when we introduced the new deal pilots for people aged 25 and over, in November 1998, we made it clear that we intended the pilots to run for two years, with the last entrants in May 2000. We therefore need to do what another committee under different chairmanship did a year ago: to renew the existing regulations for a further year. I shall briefly outline the key features of the pilots and the progress that they are making.
There are 28 pilots for people aged 25 or over across Great Britain, and one covering the whole of Northern Ireland, which between them will help 90,000 people. They have been designed to allow us to learn lessons which will inform the future development of help for this group of people. They are aimed principally at people who have been unemployed for 18 months or more, but in some of the pilots we are testing the impact of offering that help earlier to those at, or beyond, the 12-month period of unemployment. In four areas we are also testing the effectiveness of allowing people at a particular disadvantage in the labour market earlier access to the pilots. The pilots are delivered by a variety of public and private sector organisations.
We built a good deal of flexibility into the design of the pilots, so that the provision could be responsive to individual need and local circumstances. Pilot participants initially enter a gateway period of advisory support and other help to find work. Those who do not find work in this gateway period are then required to take part in intensive job search alongside other activity, for example work experience or job-focused training, for up to 13 weeks. During that time, they will receive a grant of up to £200 paid over and above their JSA and other benefits. Those who do not find work by the end of that time are then offered further help in the follow-through period.
Initial statistics—I stress that they are initial—show that up to the end of August, more than 54,000 people entered the pilots and at least 7,500 found work, while the majority continue to benefit from the intensive support that is available. The figures are encouraging, but it is too early to make an assessment of the pilots' impact or, indeed, to consider ways in which the approach to delivering help in finding work to this group of people may be refined and developed as the pilots proceed. We have put in place an evaluation strategy to measure the impact of the pilots on those participating in them compared with people outside the pilots. That comparison will in due course enable us to judge the added value of the pilots. However, the main outputs from the evaluation will not be available until next year.
The renewing regulations that I am proposing today support the pilots in a number of ways. They prescribe the categories of people who will be required to participate in the new deal pilots and the impact on their benefit of not participating, and they ensure that payments that they may receive as part of the pilot, including self-employed earnings, will not affect their benefit. These regulations simply renew those that were introduced last year to support the pilots, and the amending measures that were introduced in April 1999 to allow pilot participants to begin setting themselves up in business while claiming jobseeker's allowance. A number of minor technical changes have been made to reflect the new arrangements for decision making and appeals and the introduction of the working families tax credit and disabled person's tax credit. We have also added a transitional provision to ensure that participants fall within an uninterrupted regulatory framework.
I believe that these pilots are crucial in helping us determine the shape of future support for adult unemployed people. The regulations give us the power to continue the pilots, as originally planned, so that we have sufficient practical experience on which to draw. I commend them to the House.
4.34 pm
Mr. John Bercow (Buckingham): I am delighted to be here, supported by my hon. Friends the Members for Spelthorne (Mr. Wilshire) and for Bury St. Edmunds (Mr. Ruffley), for three reasons. The first is that we are meeting under your august chairmanship, Mr. Winterton, 28 years and 39 days after your election as the esteemed Member for Macclesfield on 30 September 1971, which I am sure you remember and of which you are, no doubt, proud. Secondly, it affords me my first opportunity publicly and warmly to congratulate the Minister on her appointment. I wish her every success with what is a challenging responsibility, and I hope that she acquits herself of it well. Thirdly, this is my first Standing Committee on delegated legislation. I hope that hon. Members will not judge that it should also be my last.
It makes sense to consider the regulations together, and I was happy to agree to the Minister's suggestion that we should do so. I should like to deal as briefly as I can with the regulations in turn.
First, I shall deal with the Jobseeker's Allowance Amendment (New Deal) Regulations 1999. The view of the official Opposition is that the regulations are sensible and that they should prove to be uncontroversial. As I want to focus on other matters, I shall resist any temptation to dilate my remarks on them. They make perfectly good sense, and the Opposition do not object to them.
Secondly, I turn to the Jobseeker's Allowance (Amendment) (No. 2) Regulations 1999, about which I echo the Minister's statement. As far as I can discern from study of the regulations, they are guided by three principal motives. None of those motives is exceptionable, and the Opposition agree with all of them. The regulations' first aim is to facilitate smooth transition from incapacity benefit to jobseeker's allowance where such transition is necessary. Why is that smooth transition needed by virtue of the introduction of regulation? The answer is because it does not currently exist. In the past, cases have arisen in which people have not been able to transfer to jobseeker's allowance, unfairly and without the original intention that that should be so. That has occurred principally because such people were not available for work at the relevant time, for the simple reason that they could not expect that they would subsequently be required to have been available for work. It makes obvious sense that the Government should change that state of affairs.
The regulations' second aim, as I understand it, is to allow prisoners released from jail a short period to adjust to civilian life before they make themselves available for work. Their third aim, as the Minister said, is contained in a technical measure that might be described as a cleaning-up operation, which is required because of the changed structure of training and enterprise councils. I refer specifically to the existence of chambers of commerce, training and enterprise. That tidying up is being done elsewhere, and it makes sense to do it in the regulations.
Thus far, and perhaps uncharacteristically, myself individually and the Opposition collectively are in agreement with the Government. Such is our agreement that we could almost—I must not overstate the case—dance round the political mulberry bush together. However, all good things—or, from the vantage point of some hon. Members, all bad things—must of course come to an end. Regrettably, the Opposition are less sanguine about the Social Security (New Deal Pilot) Regulations 1999, although I await with interest the Minister's response.
My first concern, which is shared by other Opposition Members, is that the Government's approach seems to put the cart before the proverbial horse. The Committee is being invited to approve the regulations for a second successive year, which will mean that the pilots continue for a second year. However, Ministers have offered a dearth of meaningful information about the operation of the pilots in the first 12 months since they have taken effect. It is frankly risible that Ministers are telling Parliament next to nothing about the performance of the pilots since their advent in November 1998 but expect hon. Members to give the green light for their continuation. I suggest that that is an insult to Parliament and to all those who wish to judge the success or failure of schemes intended to help the long-term unemployed.
I do not cavil at the Minister herself, and I do not blame her. I suspect that she was not personally aware of the decision to pursue the matter in such a way. At any rate, I doubt whether the decision was her inspiration. I am rather inclined instead to blame the dark forces, not of conservatism, but of the Government Whips Office, which seems to think that the process that I have described is an acceptable way to proceed. It is not good enough, however, merely to present hon. Members with a pig in a poke and to expect us to give the silent nod of assent. Such an approach might be acceptable to the pre-programmed robotic tendency in the Government, which I hope will not be represented among Labour Members today. Indeed, I do not think that any of those present falls into that category. They are all strong-minded and independent spirits capable of expressing themselves forcefully when necessary. Whether the measure is acceptable to Labour Members or not, it is not acceptable to Conservatives. We want to see the evidence before reaching conclusions—that is a commonsense approach. We would like to see evidence in particular regarding the success of the pilots undertaken thus far.
In that context, I draw the Committee's attention to the preamble to the regulations, in which is used a form of words also used in the preamble to an earlier set of regulations justified by former Ministers to Committees. That part of the preamble reads:
``will, or will be likely to, encourage persons to obtain work or will, or will be likely to, facilitate the obtaining by persons of work.''
We shall be delighted if that proves to be the outcome: long-term unemployment is a serious problem.
An especially grievous difficulty concerns people aged more than 25—and, in some cases, people far older than that—who suffer the indignity and deprivation of long-term unemployment. In so far as Ministers are seeking to remedy that problem—to get people jobs and to increase the likelihood that people will become more employable because of their qualifications and training—we applaud them. We hope, though we are not yet sure, that the specific measures that they commend to the House to achieve that objective will be successful.
The Minister rightly highlighted the differences between the pilot projects. There are 28 in Britain, with one covering Northern Ireland. Fourteen of them are for people unemployed for at least 18 months and 10 are for those unemployed for at least 12 months. Four are part of the early-entry experiment to see the effect of the pilots on people unemployed for a shorter period but who suffer a specific disadvantage making it harder for them to find jobs.
We debate the regulations against a significant and serious background. Ministers have celebrated the new deal; the Opposition do not dissent from the sentiments behind it. However, the Minister will know that we believe it to have been long on hype and short, thus far, on delivery. For example, less than a quarter of the people aged 25 or more completing the new deal programme to date have managed to acquire sustained and unsubsidised employment. Moreover, 41 per cent. of that group, regrettably, have left the advisory process for nothing better than the revolving door of continuing benefit dependency. The Committee will be aware that more than 50,000 people have left new deal schemes for what the Government have euphemistically described as unknown destinations.
The Minister will have done her homework thoroughly and will be aware of the assertions made by the noble Lord Russell in another place on 29 October. He went so far as to assert that only 8 per cent. of those on the new deal aged more than 25 have managed to secure unsubsidised employment to date—one in 12 of participants. I do not know how that compares with the position of those on individual pilots, but I hope that we shall be told.
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