................................................................................ ON THE RECORD RECORDED FROM TRANSMISSION BBC-1 DATE: 12.10.97
................................................................................ JOHN HUMPHRYS: Good afternoon. The government says it's going to get young people in Britain off the dole and into work... and off drugs and out of crime. I'll be talking to the two ministers who have that task. That's after the News read by MOIRA STUART. NEWS HUMPHRYS: In opposition the Labour Party made five firm pledges. One of them was to find jobs for unemployed young people. Another was to crack down on youth crime. Last week the government gave us somemore details about what it's going to do for youngsters on the dole. I'll be talking to the Employment Minister Andrew Smith about that. One of the most radical measures the government has taken since it came into office was to bring in a windfall tax on the privatised utilities. It'll raise about five billion pounds and most of that is meant to be used to find work or training for unemployed youngsters. But do the plans really make sense now? The employment minister Andrew Smith is with me. And I say 'now' Mr Smith, because this was one of your big big pledges, most important pledges, and yet, by the time you actually have that money and start using it for what you intend to do, half of those two-hundred-and-fifty thousand youngsters who you thought would need to find work will have already found jobs through the normal workings of the market. So is it the right thing to be spending all that money on? ANDREW SMITH: It's certainly the right thing because even now on present trends there are well over a hundred thousand young people, eighteen to twenty-four year olds who've been without work for more than six months, and every month more than ten thousand, probably something like fifteen thousand, pass that six month threshold, and what we've got to ensure is that they don't drift on into one year's unemployment, two year's unemployment, and become part of that awful problem of youth unemployment that we've had under the Conservatives. HUMPHRYS: But every month ten thousand or so actually find work, so the nett effect is to reduce constantly - to reduce that total number. It's going to be eroded, SMITH: That's why, within our New Deal programme we've got what we're calling the gateway - a period of between one and four months preparation before youngsters go on to the four new deal options, the employment option, work on the environmental task-force, work in the voluntary sector, or full time education and training. Before they get to that point they'll spend between one and four months in the gateway, and the first thing we will be doing is assessing their job readiness, seeing their strengths and weaknesses, and for those who we can get straight into jobs, unsubsidised jobs, we will be getting them into work. But you see, there's the rest, those who would linger on, six months, a year, two years unemployed, and what we've got to ensure is that they have the skills and the real work experience that are going to reconnect them with the opportunities and the responsibilities of work. HUMPHRYS: Well, let's look at how it would work then, and one of the key things is this subsidising in effect - subsidising employers with tax subsidies so that they get, what is it, sixty-pounds a week for twenty-six weeks. The trouble with that isn't it, is that you have no way of knowing whether you are simply creating jobs that would have existed anyway - you're not actually creating them at all in other words - and the managers or the employers are simply saying, "All right we'll have that money and we'll take the kids in to do that job" They'd have actually employed people anyway, but this way you're just giving tham a few pounds in their back pocket. SMITH: As I've already said, in this gateway period we first of all get the youngsters who are job-ready into the jobs, into unsubsidised jobs, but there are those ... HUMPHRYS: You don't get them in, let's be clear about that, you don't get anybody into jobs - employers take them. SMITH: Employers do, and of course it's up to employers who they choose ... HUMPHRYS: And if they're going to do that they will do it anyway, whatever you do. SMITH: The message we get from employers, and we've carried out very extensive consultation on this, and we've got an advisory task-force, it's got substantial business representation on it, and what they tell us is what concerns them is the job readiness, the level of skills which the young people who come to them have. Now what the New Deal programme is about is ensuring that young people have those skills, are prepared for work, are being advised towards the jobs which are right for them. So it will be getting, with the attraction of the subsidy, young people into real work experience with skills, who wouldn't otherwise have had that chance. HUMPHRYS: Yes, but the idea ultimately is to provide these youngsters with jobs for life. I mean you're not intending simply to give them a job for a few months and then say: "Right you're on your own now son". I mean that's not what it's all about at all is it? Let's look at Sainsbury's. Now Sainsbury - you're very pleased with what Sainsbury's have said aren't you, because they've said: We're going to create up to a thousand jobs as a result of this scheme, as a result of this subsidy. Now are they new jobs that Sainsbury's are creating, or are they merely taking advantage of the fact that you've given them a bit of extra money? SMITH: Well, I greatly welcome the fact that Sainsbury's have committed to saying they'll give up to a thousand jobs to youngsters who come through the New Deal programme, so these will be young people who would otherwise have found it very difficult to get a foothold in the labour market, and it's not just Sainsbury's either, it's Ford, Prudential, Tesco, Rover, Unipart, BT, and a growing list of firms, small firms as well, who are saying the new deal makes sense for their business, because it can increase the availability to them of young people with skills who've had some preparation for work. And now is the right time to be doing it, because as the numbers in employment are growing, as there are a record level of vacancies out there, what the New Deal programme can ensure is that young people have the skills, have the right attitude to work to be able to take those jobs. HUMPHRYS: But those jobs, they're just - it's just substituting isn't it one thing for another. I mean the fact is Sainsbury's either need to take on another thousand youngsters, or they don't. And if they don't need to take on another thousand, once the subsidy is ended what happens to those kids, and what happens - it doesn't work does it? SMITH: It does work because that's an oversimplified and distorted picture of how the labour market is .... HUMPHRYS: Either they're essential or they're not. SMITH: It's a distorted way of - that picture of how the labour market works. At the moment across the country in jobs centres alone there are record levels of vacancies, two-hundred-and-ninety thousand vacancies at the last count, and what the New Deal can do is help ensure that young people have the skills, the right experience to be able to fill those vacancies which would otherwise have gone unfilled. HUMPHRYS: If that is the case - if that, really, is the case - that employers want youngsters; have got the jobs already - that's what you're telling me - the jobs exist already and the difficulty is finding youngsters with the right skills, the right training, the right education to take them, then your money is being spent wrongly, isn't it? That money ought to be spent - if you've got five billion sloshing around, or whatever it is - you spend that money on educating youngsters, so that they are ready to take those jobs, not doing what you're doing, which is subsidising employers for people whom they would take on anyway, if they were real jobs. SMITH: The expenditure on the Employment subsidy is only a small proportion of the total programme. The expenditure is going on precisely what you're arguing for, which is- HUMPHRYS: Not ............ SMITH: In every one of the New Deal options there is a guaranteed quality programme of training and- HUMPHRYS: But children are leaving school_ SMITH: And, that is going to equip young people with the skills. As you say, children have been leaving school- HUMPHRYS: And, they can't read and write! SMITH: Without the skills- HUMPHRYS: You're not going to be teaching them to do that! SMITH: We are going to be teaching them to do that within this period, because in this period of assessment, in the gateway, those who lack basic skills, have problems with literacy and numeracy, they will have the opportunity to go on intensive programmes, to bring them up to the standard that they need to get a job and then, when - if they don't go into a subsidised job, if they go, for example, onto the environmental taskforce, or into work in the voluntary sector, then they will both be - they will be continuing their training into an accredited level, towards recognised qualifications. And at the same time, they will be developing the habits of work: getting up in the morning, turning up for work, learning to work as a member of a team, equipping them with precisely the skills they need to get jobs and to stay in jobs and not be consigned to ever-lenghtening unemployment and dependancy on benefit, which is the problem we inherited from the Conservatives. HUMPHRYS: But, you see what you're doing when you tell me that is that you are accepting that there are an awful lot of youngsters leaving school who don't have the wherewithal to find a job. Now, surely, what you ought to be bearing in mind: your slogan is education, education, education. You should be using every penny you can lay your hands on (all five billion out of that with privatised Income Tax) in order to teach the kids to do that when they're at school - not wait until they leave school, unable to do it and, then say: now, we're going to put in this grand scheme. SMITH: First of all, as you well know, John, we're putting enormous emphasis on Education, into raising standards, the extra money put in the Budget, the literacy and numeracy targets, raising the standards of training, the commitment to phase out the assisted places scheme and to cut classes. Of course, we make all that effort with the children that are in the school system at the moment. But, we cannot simply abandon, indeed some of that five billion is going into the schools and the one-point three billion to repair their basic fabric over the life of the Parliament. But, we cannot - surely, you're not suggesting that we can abandon more than a hundred thousand young people out there who are more than six months unemployed and the ten thousand or more who join them every month because that's what's led to the problem, where people fail to get their first job, fail to get their second job and end up in long term unemployment and connecting, of course, with the problems of crime and drug abuse that you have just been talking about, where we see whole communities blighted by youth unemployment. You know, people elected us, amongst our pledges - that crucial one - to get a quarter of a million young people off benefits and into jobs, it was a very important promise and it will... HUMPHRYS: And as you say, it's down to a hundred thousand already, and I'm not talking .... SMITH: Well over a hundred thousand and more than ten thousand passing that six month point every ... HUMPHRYS: Now that's misleading, that's misleading, because the nett effect is to leave ten thousand fewer there, otherwise you wouldn't be down to a-hundred thousand. But let me pick up what you just ... SMITH: No, it's not misleading, John, because as I've already said, those who are job-ready, who are equipped with the skills to get into work, we will be getting them into unsubsidised jobs. But we have to pay attention to the rest who have been adding to the pool of youth unemployment who have become part of that persistent problem which is bad for them, bad for society, bad for the communities in which they live, which feeds into crime and social division, which is bad for the economy ... HUMPHRYS: A quick final thought. You started off with about five billion for two-hundred-and-fifty thousand youngsters, now it's down to a hundred thousand. Are you only going to need two-and-a-half million, or two billion, or whatever it is? SMITH: The costs of the programme for the eighteen to twenty-four-year-olds is actually a little over three billion. There is money also going to getting the long-term unemployed into jobs, to getting lone parents into jobs and to helping people with long-standing sickness and disability into jobs - all part of the move off welfare dependency and into work which this country needs and which we were elected to secure. HUMPHRYS: Andrew Smith, thank you very much indeed. And that's it for this week. Next week the full hour - only half-hour this week. Until then, goodbye. ...ooOoo...