The Vice-Chamberlain of the Household-- reported Her Majesty's Answer to the address, as follows:
I have received with great satisfaction the loyal and dutiful expression of your thanks for the speech with which I opened the present Session of Parliament.
The Parliamentary Under-Secretary of State for Employment (Mr. James Paice): Thirteen careers services are now operating under contract after competitive tender, and tenders for 51 more in England and Wales are being considered. We have set demanding specifications for a high standard of impartial advice from ages 11 to 18.
Sir Irvine Patnick: Will my hon. Friend join me in congratulating Sheffield careers service on winning its investors in people award, the first service in the region to do so? What are the Government doing to ensure that best practices are maintained in the careers service?
Mr. Paice: I congratulate Sheffield careers service on receiving its investors in people award, as I congratulate all the 1,000 or so businesses and organisations that have won that award. My hon. Friend is right to concentrate on the need to spread best practice, which is why we are working closely with the Department for Education. The two Departments recently produced a booklet called "Better Choices", which lays down a suggested framework for schools, colleges, local education authorities, training and enterprise councils and careers services to work together.
Mr. McCartney: While the Minister is congratulating himself, will he give us some information about the career guidance that he will give the 11,500 jobcentre staff in London who have been asked to take an unpaid Christmas holiday due to the administrative pay budget shambles, or the 750 workers who have today been sacked by Severn-Trent water company? Those job losses are in addition to the 900 job losses already announced by Severn- Trent, although its chairman has been given a £173,000 pay rise and a £500,000 pay-off on leaving the job. Is not John Maples absolutely right about the
Column 1060Government--that Ministers are incompetent and that there are record levels of sleaze and greed? It is no wonder that there is no national feel-good factor.
Mr. Paice: I welcome the hon. Gentleman to his new position, but he is obviously so intent on making his mark that he has not read the question. His question had nothing to do with careers guidance, about which my hon. Friend the Member for Sheffield, Hallam (Sir I. Patnick) asked. I should have thought that the hon. Gentleman would take comfort from the fact that unemployment has fallen by 450,000 in the past two years, as a result of which there is less need for quite as many Employment Service staff.
The Secretary of State for Employment (Mr. Michael Portillo): British workers' average take-home pay is among the best in the European Union, better than France, Italy or Denmark and comparable to western Germany.
Mr. Luff: Does my right hon. Friend agree that his answer provides further evidence of a remarkable combination of low personal taxation, high take-home pay and low overall labour costs? Does he further agree that that proves the success of the Government's economic policies and gives the lie to the Labour party's claims about the dangers of a sweatshop economy?
Mr. Portillo: Yes, my hon. Friend is absolutely right. It is important to do away with the myths. Wages in Britain are relatively high and taxes are low, so take-home pay is high. In addition, the Government are extremely careful not to impose costs, burdens and inflexibility on employers that would make them uncompetitive. Of course, the Labour party is committed to the social chapter-- [Interruption.] --and to making sure that those costs are higher so that jobs would be lost in Britain. As I said that jobs would be lost in Britain, Labour Members cried, "Hear, hear."
Mr. MacShane: On take-home pay, is the Secretary of State aware that a pay-slip handed to me in Rotherham last weekend showed a pay rate of £1.80 an hour, which amounted to take-home pay of £99 for a 53- hour week? That is an national disgrace. At the party that he is organising to celebrate his 10 years in Parliament, will he ensure that the cleaners, servants and the people serving the champagne--of which that rate of pay would buy four bottles--will be paid a decent wage?
Mr. Portillo: If the hon. Gentleman is worried about pay today, I hope that he will at least congratulate the Government on the massive improvement that has occurred during our term in office. Pay in real terms for the bottom 10 per cent. of full-time workers has increased by 23 per cent., whereas, under the previous Labour Government, their pay fell in real terms. He should be concerned about the Opposition parties' proposals for a minimum wage, which would destroy those people's jobs. It is better for people to be on the ladder of progress with a job than to be put out of work by a minimum wage and to have no job at all.
Column 1061Hull, East (Mr. Prescott) that the way forward in solving the unemployment problem is to borrow more money, to get more people into public service jobs and to ignore efficiency, or does he agree that British workers should be climbing the technology ladder for a high-wage, highly efficient economy in Britain?
Mr. Portillo: My hon. Friend is right. That was the second major contribution by the right hon. Member for Kingston upon Hull, East to the national economic debate. On the first occasion, he admitted that a minimum wage would cause a shake-out--a euphemism for saying that it would destroy jobs. He has now applied his mind to the unemployment problem and believes that the remedy is for inefficient public services to employ more people and that that, somehow, will bring down unemployment. It would mean, of course, higher taxation on the wealth-creating sector and it would damage incentives and destroy jobs. I thank my hon. Friend for bringing those two arguments from the right hon. Member for Kingston upon Hull, East to the House's attention.
The Minister of State, Department of Employment (Miss Ann Widdecombe): The Government recently introduced a number of extendeand enhanced rights for employees in the Trade Union Reform and Employment Rights Act 1993. It is now automatically unfair for an employer to dismiss an employee for taking certain specified types of action on health and safety grounds, for seeking in good faith to assert a statutory employment right or for reasons connected with pregnancy or childbirth.
Mr. Mackinlay: What advice would the Minister give a constituent who came to her surgery and who showed prima facie evidence of unfair and arbitrary dismissal but who had been employed for less than two years? What remedy to that wrong would she suggest to her constituent?
Miss Widdecombe: Certain automatic rights are available to all employees, regardless of hours worked. It is important that a balance is struck between undue burdens on employers and the protection of employees. The two-years' policy strikes the right balance.
Mr. Butterfill: Many people, particularly hoteliers in my constituency, think that rights are already loaded against them and that industrial tribunals' decisions prevent them from operating efficiently. If the social chapter were introduced in this country, would not many jobs be destroyed and our unemployment level be the same as that in Spain and France?
Miss Widdecombe: I agree with my hon. Friend's latter point. To maintain that balance and to ensure that we do not overload employers with unreasonable requirements, we have strongly resisted paternity leave, the part-time work directive and other measures that militate against employers employing and that destroy jobs. The most
Column 1062important protection that a worker can have is to be able to get a job; the Opposition would ensure that he would not have it.
Ms Eagle: Almost nine months ago, the Government lost a case before the European Court and were told to equalise the rights of part-time and full-time workers. Since then, we have heard nothing but a deathly silence from them. When will they bring part-time workers' rights into line with those now enjoyed by full-time workers?
Mr. Paice: Seventy-two per cent. of young people completing youth training gain a qualification or a credit towards one, and the percentage of trainees gaining higher level national vocational qualifications is increasing year on year.
Mr. Clappison: Is my hon. Friend aware that the modern apprenticeship scheme has been well received in Hertfordshire? Will he join me in congratulating Hertfordshire training and enterprise council on the excellent lead that it is taking in the manufacturing sector?
Mr. Paice: I shall, indeed. Hertfordshire training and enterprise council has taken the lead in the engineering and manufacturing sector and must be congratulated on that. Eighteen prototype modern apprenticeships are up and running and 40 more are expected next year. When they are fully in place, 70,000 people a year will be qualifying at NVQ 3 level through modern apprenticeships, which is a step change in the skills supply of this country.
Rev. Martin Smyth: But does the Minister accept the concern that we do not have enough trained technicians--a fear shared by industrialists and expressed to me only last week when the Esso energy lecture prize was being given? Are he and his colleagues trying to improve that situation?
Mr. Paice: All the studies show that it is at NVQ level 3--the technician/junior management level--where our skills problems are most severe by comparison with our competitors. That is why we introduced modern apprenticeships and why the White Paper proposed the concept of accelerated modern apprenticeships for those who have stayed on in further education beyond the age of 16. We are very conscious of the fact that there is a problem,
Column 1063and those two measures, in addition to the changes to the funding mechanism for TECs, will encourage far more skills to be gained at that level.
Mr. Barron: Where did the Minister get his misleading statistics about the qualifications gained by people on youth training? This month's Employment Gazette states that two years ago, in July 1992, 37 per cent. of people leaving youth training received a qualification or a credit towards one. In July 1994, the figure was only 41 per cent., not 72 per cent., as he claims. I am quoting the Government's own statistics. Why do we constantly hear fiddled figures from the Department of Employment about our crisis in training? In view of the very small growth in youth training, why have the budgets of TECs been slashed every year for the past five years?
Mr. Paice: Seventy-two per cent. of youth training completers in the year to January this year gained a qualification or a credit towards one-- [Interruption.] I am talking about those who complete youth training. They are the statistics with which the House should be familiar. As for funding, the hon. Gentleman will have to wait a little longer.
Sir Teddy Taylor: I greatly welcome the improvement, but is the Minister aware of the resentment in Southend that areas with lower unemployment receive loans, grants and subsidies for job creation? As the committed Conservative that we all know her to be, will she and her colleagues at the Department endeavour to get rid of the absurd distortions in the labour market and try to establish a level playing field so that Southend gets a fair deal?
Miss Widdecombe: I have to say to my hon. Friend that, for one moment, I thought that he was about to ask for equalisation for Southend by getting some European moneys. However, I can give my hon. Friend the assurance that, even without such moneys, Southend is doing very well. Long -term unemployment has fallen by 12 per cent. since last year. Youth unemployment has fallen by 15 per cent. Retail opportunities are creating more than 600 new jobs. Vacancies are up by 4.9 per cent. and placings are at their highest level since November 1990. Good old Southend is doing quite well.
Column 1064kicked out the hon. Member for Southend, East (Sir T. Taylor) and deprived us of the opportunity of doing so at the next election.
The Parliamentary Under-Secretary of State for Employment (Mr. Phillip Oppenheim): The summer 1994 labour force survey shows just over 25 million people in employment in Great Britain, an increase of 226,000 since summer 1993.
Sir Thomas Arnold: I welcome those figures. Will my hon. Friend confirm that the combination of the pursuit of low inflation and further measures to promote productivity offers the best hope for jobs in the future?
Mr. Oppenheim: My hon. Friend is absolutely right. Employment is rising and unemployment is falling in Britain far faster than in the EC as a whole, especially in countries with minimum wages, such as France and Spain, where youth unemployment is two and three times the British rate respectively.
Mrs. Mahon: Is the Minister aware that one in three jobs offered to young adults is paying below subsistence level? Is he also aware that those under 18 often get as little as £45 a week? Could he live on that? Could he plan a future, get a mortgage, get married and bring up a family on that? Will he tell us how he could do those things on poverty-level wages?
Mr. Oppenheim: The hon. Lady totally ignores the fact that under this Government pay at all levels has risen sharply; that is so for the low -paid as well. A single man in the bottom 10 per cent. of earnings has seen take-home pay increase by almost a quarter more than inflation under this Government. The hon. Lady may like to know that that same person would have seen his pay fall under the previous Labour Government.
Mr. Page: Will my hon. Friend please help me? In 1990-91, with unemployment going up in my constituency, I had the papers on to me every month asking what would happen about unemployment and what the Government intended to do about it. In the past two years, and in the past 18 months in particular, unemployment has dropped substantially. We are now down to a figure of 2,000 unemployed, which is well below the national average, yet the papers have not been on to me once. What should I do about it?
Mr. Oppenheim: It is the old adage that good news often is not news whereas bad news is news. We have a lot of good news in the British economy. Exports are at record levels, productivity is rising by 6 per cent. a year and manufacturing output is up by 5 per cent. a year. That is the best way of ensuring not only more jobs, but more high-paid, high-skill jobs in the British economy. That is what we are now getting.
Column 1066Mr. Portillo: The Government's economic policies aim to create low inflation and sustainable growth, which will lead to more reductions in unemployment and more job creation. For some time, my Department's priority in helping to achieve that has been to give special help to people who are long-term unemployed. Long-term unemployment is now less than 1 million, the lowest figure for two years.
Mr. Pickthall: Unemployed people will have heard what the Secretary of State said and, I guess, will have believed it almost as much as he did. Does he recognise that 38 per cent. of total unemployment is long-term unemployment? In Skelmersdale, in my constituency, long-term unemployment is as high as 44 per cent.--more than 1,000 adults have been unemployed for over 12 months in one small town. Why do his Government refuse to consider schemes such as national insurance holidays or tax rebates to encourage employers to take on the long-term unemployed in order to relieve a town such as Skelmersdale of the social tragedy that long-term unemployment forces on it?
Mr. Portillo: Unemployment is west Lancashire is down by 25 per cent. from the peak. The hon. Gentleman is right to say that long-term unemployment in this country is about 35 per cent. of total unemployment; the average for the European Union is 42 per cent. If the hon. Gentleman looks around Europe and finds a socialist Government, he will find higher unemployment, higher long-term unemployment, higher youth unemployment and that unemployment has not been falling as it has been in this country. If there were a socialist answer to this question, presumably socialist countries would have delivered it.
Ms Gordon: Does the Minister agree that this country needs not only job seekers but job finders and that a change of name, another fiddle of the figures and another cut in benefits for which people have paid national insurance contributions for years will not solve the problem of long-term unemployment, especially for older people? Does he agree that the only solutions are effective Government job-creation policies, such as releasing the capital receipts of right-to-buy sales and other strategies outlined by my hon. Friend the Member for Lancashire, West (Mr. Pickthall)?
Mr. Portillo: No, the hon. Lady is wrong. The real answer is sustained economic recovery, which requires our pursuing vigorous and determined economic policies. I am sure that we shall see some more of that from my right hon. and learned Friend in his Budget this afternoon. Of course I believe that we should give special help to long-term unemployed people. That is why 1.5 million different opportunities are provided for long-term unemployed people during the course of the year. The hon. Lady is absolutely wrong to say that the solution to this problem is yet more borrowing and yet more Government spending. Her Government and Governments around Europe tried that, and it resulted in higher unemployment. We have pursued a sustainable recovery and unemployment is falling in this country.
Mr. John Greenway: Does my right hon. Friend agree that the private finance initiative is now the best way for us to create more jobs in providing the infrastructure that this country needs? Will he state why he thinks that private
Column 1067companies should invest in inefficient public services--a policy that appears to be advocated by the right hon. Member for Kingston upon Hull, East (Mr. Prescott)?
Mr. Portillo: It is quite extraordinary that the right hon. Member for Kingston upon Hull, East should have made such a suggestion. The inefficiency of the public sector has to be paid for by taxpayers and there is no reason why taxpayers should pay for inefficiency. It is not a good way to create employment. The way to create employment is to have sustained recovery. My hon. Friend is absolutely right to say that the private finance initiative can play an important part in providing infrastructure and I expect that the Chancellor will make some comments on that subject.
Sir Michael Neubert: Would not the all-important morale and self- confidence of those out of work be greatly improved if Her Majesty's official Opposition adequately recognised the reduction in unemployment over two years of almost 455,000, if they recognised adequately the high level of employment in this country, by comparison with most other European countries, and if they stopped denigrating the employment and training programmes, which are providing 1.5 million places this year, as my right hon. Friend has just mentioned?
Mr. Portillo: Yes, it must be very dispiriting to those who are looking for work to find that the Opposition are determined not even to acknowledge the fall in unemployment and to recognise, for example, that the Opposition have always opposed the creation of our youth training programmes. Indeed, the hon. Member for Peckham (Ms Harman), the new Labour spokesman, was busy criticising those programmes again the other day.
It is a massive deceit on the British public for the Labour party to pretend, as the Leader of the Opposition was doing the other day, that it can spend its way out of unemployment. We cannot spend our way out of unemployment. We can reduce unemployment if we follow a policy of low inflation and sustained recovery.
Mr. Chidgey: Is the Minister aware that fewer than one in five of the long-term unemployed who complete a training for work programme are able to find work and remain in it? Does he agree that it is time for a radical working benefits programme with benefits transferred to a training subsidy to ensure that unemployed people are given the high skills that they need to find productive and stable jobs?
Mr. Portillo: I agree that we should be flexible in our thinking about those matters, and I share the hon. Gentleman's dissatisfaction with the present level of achievement of training for work. If we are going to spend that much money from taxpayers' sources on training for work, we should be able to ensure that more people get jobs. The principal purpose of training for the long-term unemployed is to get them into jobs. We shall need to reorient our programmes to reflect that.
Mr. Alan Howarth: Has my right hon. Friend noted that, notwithstanding the Government's strenuous efforts to address the problem of long-term unemployment, 59 per cent. of men aged between 55 and 64 remain out
Column 1068of work? Does he consider that, in the circumstances of today's labour market, the terms of the jobseeker's agreement should be different for different groups? Is there not a risk that the requirement on those for whom work is not available to go through the motions of actively seeking work will become a somewhat humiliating feature of the claiming process rather than a contribution to the functioning of the labour market?
Mr. Portillo: No, I do not agree with my hon. Friend, on this basis: I believe that it is absolutely wrong to give up on any section of the population below the age 65 which has the opportunity to move into work. There is a fair amount of discrimination against those people and that is why I encourage the Employment Service to take particular steps to help some of the older men and women who have been out of work for a period of time. However, I believe that those people should be kept in touch with the labour market, and that the jobseeker's agreement is an important way of handling that.
Ms Harman: Does the Minister accept that many of the long-term unemployed lack the skills that they need to get a job? Is he aware that the Government's survey--"Skill Needs in Britain"--reports that a growing number of companies are complaining that they cannot expand because they cannot find the skilled workers that they need? When we have, at one and the same time, unemployed people who cannot get jobs because they lack skills, and businesses complaining about skills shortages, would it not be madness to make further cuts in the training budget?
Mr. Portillo: I welcome the hon. Lady to her new position and I look forward to continuing our fruitful partnership. However, I do not believe that her analysis of the question is as close to the mark as that of the hon. Member for Eastleigh (Mr. Chidgey), speaking from the Liberal Benches.
One of the problems with training for work is that we are getting quite a few people with qualifications, but we are not succeeding sufficiently in getting those people into work. If the hon. Lady thinks about it, I am sure that she will agree that the principal purpose of training long-term unemployed people is to give them jobs. That is the focus that I want to apply. Skills for those people are a way of getting them into work. We should not be satisfied just with giving them skills; we should concentrate on getting them jobs. That is what they want.
Mr. Thomason: Does my right hon. Friend agree that, in addition to the significant contribution provided by economic improvement, education and training have played an important part in reducing the number of unemployed people? For example, they have reduced unemployment in my constituency by 17 per cent. since
Column 1069October 1994. Does my right hon. Friend further agree that education and training and the improvement of job skills are a vital ingredient in continuing to provide opportunities for jobs?
Mr. Portillo: I agree absolutely. My hon. Friend's question stands in sharp contrast to the question that the hon. Member for Peckham asked a moment ago. Education, as well as training, is important. The Government's reforms have ensured that more people stay at school longer and leave school with better qualifications.
We know perfectly well that the Opposition have opposed the national curriculum, they have opposed testing and they have opposed league tables in schools. When the Labour party left office there were 7,000 youth trainees; there are now 277,000 youth trainees. When it was in office, the Labour party was content to allow 16 and 17-year-olds to live on benefit. That is the party which now advocates the minimum wage--a policy which in Spain has created three times as many young unemployed as there are in this country.
Mr. Flynn: Is the Minister aware that an advertisement for a job in this place, paying half the salary of a Member of Parliament, attracted 600 graduate applicants? Is he aware that an army of education system success stories remain unemployed? Will he, for once, give a straight answer to a straight question and tell the House what proportion of young people were in full-time work in 1979 compared to the present?
Mr. Portillo: I cannot give the hon. Gentleman a number, but I can say that, under the Conservative Government, youth unemployment is 13.1 per cent. In France, youth unemployment is 23.2 per cent.; in Italy it is 32 per cent.; and in Spain, which has had a socialist Government for the past 10 years, it is 35.4 per cent. If the hon. Gentleman wants to mix it with me, let us do so on the European comparisons.
Mr. Evennett: Does my right hon. Friend agree that the educational and training opportunities for young people in this country have never been better, with more A-levels, more vocational qualifications, job training and the new apprenticeship scheme? Should we not be exalting those opportunities for our young people, which enable them to get good jobs?
Mr. Portillo: Today, 80 per cent. of 16-year olds are in education. Under Labour, the figure was 58 per cent. Today, 26 per cent. of 17-year- olds get two A-levels or more. At the end of Labour's term in office, the figure was about 14 per cent. Any indicator that we care to take shows that we are providing better education for our young people.
The Labour party not only let young people down when it was in office but now wishes to impose a minimum wage to make sure that they cannot get jobs.
Column 1070I will not let that happen; there will be no minimum wage while I stand at the Dispatch Box. The Labour party would introduce a minimum wage and destroy jobs for young people.
Mr. Campbell: Is the Minister aware that unemployment in the Blyth valley is still 2.5 per cent. higher than the national average? Is he also aware that a worrying trend in the Blyth valley is the number of long-term unemployed, which has increased by 24 per cent. over the past five years? Is he further aware that there are many job losses for the area in the pipeline? With the demise of Swan Hunter, highly skilled design workers have had to leave the area. Five hundred science and development jobs will be lost from British Gas and 400 jobs will be lost from Northern Electricity. Will the Minister get off his backside, get some jobs for the north-east and help the people of the Blyth valley?
Mr. Oppenheim: The hon. Gentleman is ignoring the fact that job vacancies in his travel-to-work area have been rising very rapidly. I agree with him on one point: we all accept that unemployment is still too high. It is too high all over Europe and throughout the developed world.
In this country, the level of unemployment is falling and employment is rising far faster than it is in the rest of Europe. As the hon. Gentleman has wilfully provoked me, I remind him that when his party was in power the number of unemployed in the north doubled and rose at a far faster rate than it has under this Government.
Mr. Jacques Arnold: What does my hon. Friend think would be the unemployment in Blyth valley if the social chapter and the minimum wage were adopted, both of which policies the hon. Member for Blyth Valley (Mr. Campbell) supports?
"Don't kid yourselves. The minimum wage is something on which unions will build differentials. 1/4 Therefore, the minimum wage becomes a floor on which you erect a new tower."
The minimum wage would replace low pay with no pay. The minimum wage would create unemployment in Britain, just as it has done in Spain and France.
Mr. Paice: The competitiveness White Paper sets out proposals for better careers advice and work experience which, together with more vocational routes, should motivate young people to maximise their talents.