Select Committee on Education and Employment Eighth Special Report


EIGHTH SPECIAL REPORT

The Education and Employment Committee has agreed to the following Special Report:—

GOVERNMENT'S RESPONSE TO THE SEVENTH REPORT FROM THE EDUCATION AND EMPLOYMENT COMMITTEE, SESSION 2000-01

AGE DISCRIMINATION IN EMPLOYMENT

The Education and Employment Committee reported to the House on Age Discrimination in Employment in its Seventh Report of Session 2000-01, published on 27 March 2001 as HC 259. The Government's response to that Report was received on 8 May 2001. The response is reproduced as an Annex to this Special Report.

ANNEX

RESPONSE FROM THE DEPARTMENT FOR EDUCATION AND EMPLOYMENT

The Select Committee's recommendations are in bold text and numbered as per the 'Summary of Recommendations'.

The Government's response is in plain text.

The Government welcomes this report and is pleased to be able to confirm that we are making good progress on all the recommendations the select committee identified. We do however, fully accept that this is not a time to be complacent and that further work is needed.

A comprehensive answer on each of the recommendations is provided below—where some of the responses cover more than one issue, references to the relevant response have been included.

1. Both older and younger people can be disadvantaged in the labour market. The lack of robust statistical analysis on the extent of that disadvantage does not undermine the thrust of the evidence we have seen which leads us to infer that age discrimination does occur in employment.

The Government agrees with the statement that both young and old people can face disadvantage in the labour market. A key part of our strategy has been to challenge these cultural stereotypes and promote a recognition that people should be considered for their skills and abilities not their age. A comprehensive consultation carried out in 1997 mirrored the Committee's concerns and identified that although age discrimination was recognised as a problem, there was little evidence to show how widespread the problem was.

As with all forms of discrimination, the consultation found it difficult to provide a robust analysis on the extent to which age discrimination exists in the workplace. This is because the main body of available research evidence is based on subjective accounts of the extent to which people believe that they have experienced discrimination on the grounds of their age.

We decided nevertheless that a non-statutory Code of Practice plus comprehensive research and evaluation would be the best way to inform future decisions on age issues. In June 1999 we launched the Code of Practice on Age Diversity in Employment, supported by another quantitative evaluation and research. (See responses to 2 and 8.)

A thorough evaluation of the Code carried out over 19 months by an independent research company National Opinion Polls: Social and Political, was completed at the beginning of this year. The early findings from the evaluation found that approximately 1 in 4 people felt that they had experienced age discrimination at some point in their working lives. This finding is based on a random sample of older people, defined as those aged 50 to 69 years, surveyed over 3 waves. A new sample was selected at each wave. The results from this and our other related research including a qualitative project looking at young people's experiences of age discrimination, are now being analysed and are providing the evidence needed to formulate developing policies. The full results of all our evaluation will be published Summer 2001.

In addition to the Code, in 1998 we made a commitment to publish annually Key Indicators showing the position of older workers in the labour market . The last figures published in June 2000 showed that the number of people over 50 in work had risen by 2.4% (131,000) and that the number of people aged 50, unemployed and claiming benefit had dropped by 30,100, from 225,500 in 1999 to 195,400 in 2000. Disappointingly, there was no change in the number of economically inactive people aged between 50—state pension age in the year.

These figures were published in the September edition of the Labour Market Trends magazine and the November edition of Equal Opportunity Review.

We will continue to undertake research both to improve our understanding of age disadvantage in the labour market and to support our campaign to challenge age discrimination at work.

2. Only if there is robust information on the prevalence of age discrimination can effective policies to combat it be designed and properly evaluated. The Government should commission research accordingly. (Response 1 also applies)

The Government is aware of the need for robust data on age discrimination. For this reason over the last two years, we have commissioned a comprehensive range of age research to help inform our future work.

As mentioned previously, we have carried out a full evaluation in three stages (waves) over a period of 19 months on the impact of the Code. This focussed on identifying changes in indicative levels of age discrimination throughout the employment cycle since the Code was published. Early key findings from the final stage of the evaluation, which were published in a research summary on the 27th March 2001, show that the proportion of companies who say they take account of age in selection and recruitment has more than halved since before the Code was issued, decreasing from 27 per cent in wave 1 to 13 per cent in wave 3. The full report is due to be published Summer 2001.

A wide range of supporting research has also been commissioned focusing on specific areas where age is considered an issue. These reports are:

Factors Affecting Retirement Behaviour—looking at the reasons people leave the labour market both in the UK and abroad—published November 2000;

Training Older People—examining how older people fared in comparison to other age groups on three government supported employment and training initiatives—Work Based Learning for Adults, Programme Centres and Work Trials—published March 2001;

Research Summary—reporting early findings on the Code evaluation and three other research projects—published March 2001.

Reports due to be published Summer 2001 include:

Case Studies—Examples of Employer Good Practice in recruiting and retaining older workers —practical examples of how small, medium and large employers operate an age diverse workforce;

Ageism—The Attitudes and Experiences of Young People—looking at young peoples experiences of age discrimination;

Age Restriction in Occupational Sectors—looking at the existing restrictions in occupational sectors and whether they are justified.

We are aware that although there is a lot of research literature published, there is a lack of statistical information or long-term research literature which is robust and consistent and which focuses on the issue of age discrimination.

Our research programme starts to address this problem and is only now beginning to deliver results. We hope it will provide the information we need to better tackle the issues and design effective policy and workable legislation.

Our new research for 2001-02 will take forward some of the findings from our current research and look in more depth at the labour market patterns of older unemployed and inactive people, considering their attitudes and perceptions of policies including progressive retirement and volunteering.

In addition to our own projects, we will work with external providers and have regard to other research on age. This provides an additional source of information which we can use to inform our future work.

3. The Government's presentation of the business case is persuasive but has not been convincing enough to stimulate change on the part of employers. In view of the tight labour market conditions and severe skills shortages in some sectors, the Government has a unique opportunity to advance more powerfully the business case in favour of age diversity. We recommend that it does so with urgency.

The Government agrees there is a need to increase the profile of the business case for age diversity. (Responses to 1, 2, 5 also apply.) We are aware that although the early findings from the evaluation of the Code have shown some positive results, including the fact that there has been an increased awareness amongst employers, further work is needed. We also accept that the welcome expansion of work opportunities in the economy and the reduction in unemployment provides an opportunity to advance the business case in a more receptive environment, with more employers anxious to recruit and retain good people.

We will continue to advance the business case through supporting the work of the Inter-Ministerial Group for Older People. The IMG is currently taking forward varied strands of work focusing on older people under the banner 'Life Begins at 50—a better society for older people'. This work is based on the conclusions from the Performance Innovation Unit report 'Winning the Generation Game' on improving opportunities for active ageing; the Better Government for Older People report—'All our Futures and the findings from the Foresight Ageing Population Panel report 'The Age Shift'. This will all be considered in our future operational plans.

We have three ongoing projects:

  • Case Studies of Employer Good Practice in the Employment and Retention of Older Workers;
  • Work with small/medium employers, looking at positive examples of why they should adopt age diverse working practices; and
  • Occupational Sector restrictions.

These projects will provide a range of information which we will use to promote the business case for age positive employment practices. This material will be ready for dissemination Summer 2001.

In addition, we will continue to promote the business case by targeting employers and sectors through trade press articles and advertising, employer awards and other initiatives. We will continue to work through our external partner network and through our local and internal government department infrastructure.

4. We have in a previous report, emphasised the scope for better co-ordination between supply-side measures, such as New Deal and demand-side measures which effect employers' behaviour. Similarly, if age diversity in employment is to be achieved, there must be synergy between regeneration initiatives, employer assistance programmes and anti-discrimination measures. Tackling age discrimination and the increase In the number of those claiming incapacity benefit requires a co-ordinated approach which recognises the differences in competitiveness and gross domestic product per head between regions. We Recommend that the Regional Development Agencies should include achieving age diversity as a priority within the regional employment action plans which it has been tasked to develop. Regional Development Agencies however cannot be expected to provide the solution to a nationwide problem. The Government should address the multiple barriers to older people entering or re-entering employment. We recommend that the Working Age Agency should bring forward proposals, within a fixed time frame, to reduce those barriers.

We agree with the Select Committee's recommendation on the need for synergy between regeneration initiatives, employment assistance programmes, and anti-discrimination measures. This will be taken into account as age diversity is developed. (See also response to 3, 5, 6 and 8.)

The Government will continue to work to provide a co-ordinated programme of help for older people. For example:

New Deal 50plus—The Chancellor's Budget provided extra money for developing and marketing New Deal 50 plus. This programme has helped over 30,000 people aged 50 and over move from benefits back to work since April 2000.

Further work is underway to encourage more training and employment of older workers through 3rd Age Apprenticeships, which is being piloted in certain industry sectors.

New Deal for Disabled People—In July this year, the national extension of NDDP will begin to make a further contribution to the employment of people on Incapacity Benefits—of whom over 50 per cent are aged 50 and over. NDDP is the first programme to develop a systematic way of offering work-focused help to long term sick and disabled people.

Regional Development Agencies—The Government will be discussing with the RDAs how to incorporate age diversity within their regional economic strategies and employment action plans.

Jobcentre Plus (formerly the Working Age Agency)—In line with wider Government policies, Jobcentre Plus will deliver Welfare to Work programmes e.g. New Deal 50 plus and NDDP which will be expected to make a major contribution to reducing the barriers which prevent older people entering or re-entering employment.

6. We welcome the Government's commitment to consult widely on the terms of anti discrimination legislation. We recommend that this consultation specifically invites consideration of the single commission model for implementing legislation.

The Government is aware of the importance of consulting widely on plans for legislation. The issue of a single commission model is one of many options which would have extensive implications for many Government departments and many groups within society.

We have already set up an Age Advisory Group, chaired by Margaret Hodge, Minister for Employment and Equal Opportunities, to advise on the issues to be addressed through the consultations ahead. The Group includes organisations such as the Chartered Institute of Personnel and Development, Small Business Service, the CBI, the TUC, Employers Forum on Age, Age Concern, the Society of Chief Personnel Officers, the National Council of National Training Organisations, Third Age Employment Network, Scottish Enterprise, the Institute of Management and the British Chambers of Commerce.

The Group will help to clarify good practice in avoiding age discrimination and identify what constitutes unjustifiable practice in employment, vocational training and vocational guidance. It will also advise on ways of achieving cultural and attitudinal change.

5. We welcome the Government's recognition that the Code of Practice on Age Diversity in Employment has not been sufficiently effective in combating age discrimination and that further measures are necessary.

7. We recommend that the Government should redouble its efforts to promote the voluntary Code of Practice and extend the Code's influence in the period up to the implementation of legislation. The tight labour market and the changing demographic profile of the population makes this an urgent requirement. We recommend that the Government should report progress to the appropriate select committee in two years' in Spring 2003.

The Government will continue to build on earlier work on the Code of Practice to promote the business case for ending age discrimination in employment. The campaign will move forward with the launch of the new Age Positive branding and will build on the progress made with extending awareness and use of the Code. To date over 68,000 copies of the Code have been issued and evaluation of the Code indicates that over a third of employers are aware of it. Following their success in 2000, we will run the national age awards for a second time in 2001, including the Age Diversity in Recruitment Awards of Excellence, and the Regional Media Awards.

In addition, we will continue to focus on specific markets by publishing articles and adverts in specially targeted trade press and by maintaining a strong presence at trade shows and exhibitions which will raise the profile of both the Code and age discrimination issues.

A new Age Positive website will go live during Summer 2001. This website will provide an easily accessible bank of advice and information—including details of policy developments and forthcoming campaign activities, contact numbers, hypertext links to other useful sites such as other portals providing advice on training, retirement and general information for the public, for example, the DSS Retirement Portal. It will also include all the latest age research and statistical information. The information will be equally valuable for employers, employees and the general public.

We have also now established Equality Direct, a confidential advice service for employers and managers, providing free advice and information on equality issues including age. It has been designed with small businesses in mind.

Other measures will be related to the UK commitment to legislate against age discrimination in employment by 2006, following our signing of the EU Directive on Equal Treatment in October last year. (Response to 6 also applies.)

An extensive consultation with employers, individuals, and expert groups on age good practice, including the implications for retirement ages will have the added effect of raising the profile of the business case for age positive employment practices.

 8. We welcome the Government's commitment to flexible retirement but are concerned that exercising the derogation relating to occupational pensions may undermine progress towards this goal. We urge the Government to remove barriers to financial stability in retirement.

We welcome the committee's recommendation and are already working on ways to promote flexible or phased retirement.

However, the issues surrounding pensions are complex and changes have important legislative, tax and National Insurance issues which need to be considered. The Inland Revenue and the Department of Social Security are working on this and reviewing many aspects of the pension system. There is close working between all Departments but due to the complexity of the issues progress cannot be hurried. The report is due at the end of 2001.


 
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