These regulations were laid before the House on 13 October and I am satisfied that they are fully compatible with our obligations under the European Convention on Human Rights.
Recent labour market statistics show that youth unemployment is moving in the right direction. The most recent figures from last month show that young
people—those between 18 and 24 years of age—saw the largest annual fall in unemployment since records began, of more than a quarter of a million since last year. Excluding those in full-time education, there are now 468,000 unemployed young people. This is down by nearly a third compared to last year and is fewer than just before the recession. Clearly, this news should be celebrated, but we will not be complacent. Compared with other countries in the OECD, we in the UK still have a higher proportion of young people who are not in employment, education or training—who are NEET—and despite the general upturn in the economy, this remains a stubborn issue. Even in past better economic times, on average some 7% to 9% of young people have struggled to find work, and this is not a situation which the Government are prepared to accept.
Since coming to power we have done much to address the issue. We have expanded the apprenticeships scheme and launched traineeships to support young people who are not yet ready to apply for an apprenticeship. We have worked with business to create more than 100,000 work experience placements for young people. We have cut the national insurance contributions that businesses pay for young employees, and we set up a Cabinet Office review of all policies funding our provision for 16 to 24 year-olds who are NEET. Outcomes from this review include opening up the Jobcentre Plus network to 16 and 17 year-olds so that they can receive support and guidance from jobcentre work coaches, and a new careers guidance system is planned for 16 year-olds to help them make the best possible decisions about their future. Also as a result of the review, the Chancellor announced in the 2013 Autumn Statement the intention, and reaffirmed in the Deputy Prime Minister’s speech on 27 February last, the launch of two pilots of support for young people aimed at addressing the skills and experience gap that is holding so many of them back from joining and progressing in the labour market.
We know that a young person is twice as likely to be NEET if they have not achieved a level 2 qualification in English or maths by the age of 18—that is 19% compared with 39%. Young people are much more likely to remain unemployed for longer. Some 45% of the young long-term unemployed have qualifications in English or maths below level 2 as against 20% of the population as a whole. Moreover, two-thirds of JSA claimants do not have level 2 qualifications in English or maths. We also know from employers that English or maths skills are critical in the workplace and are paramount to the recruitment practices of many. Findings from the Employer Skills Survey 2013 suggest that where young applicants were not considered to meet the requirements of the role, the main reasons cited were lack of skills and experience.
The aim of the two pilots, or “phases” as they are described in the statutory instrument, is to test new approaches to the delivery of support for young people who lack the English and maths skills or work-related experience and skills that employers demand. It is not the aim of the pilots to deter young people from making a claim for JSA or to make the claiming of JSA harder. Through these pilots, we want to give young people the tools that will serve them throughout their working lives.
Under phase 1, we will require new claimants of jobseeker’s allowance aged 18 to 21 who do not possess level 2 qualifications in English or maths—the equivalent of a GCSE grade A* to C—to undertake learning in one or both of these subjects for up to 16 hours per week for up to six months. We will test whether the use of mandation is effective in securing participation in the learning, compare the two methods of learning in terms of effectiveness and cost, and identify the impact of the learning on job outcomes and off-flow from benefit. Under phase 2, we will require all 18 to 21 year-olds who are still claiming jobseeker’s allowance after six months to undertake an appropriate skills or work-related activity, if they are not already doing so. Doing nothing will not be an option for them. We will test the impact of mandation on take-up of provision, off-flow rates from benefit, job outcomes and skill gain. We also seek to understand how the new process is received by claimants, work coaches and employers, and the net impact of piloting this approach.
Phase 1 will be delivered in jobcentres within the Mercia, Kent, the Black Country; Devon, Cornwall and Somerset districts. Implementation is planned to begin this month, with the last referrals to learning taking place towards the end of 2015. Phase 2 will be delivered in Kent jobcentres only. It will also begin this month but is expected to end in the autumn of 2015, as we do not require as many participants to provide robust evaluation.
We believe that the pilots will have a positive impact on the skills and experience levels of young people, improving their competitiveness in the labour market and enhancing their wage-earning potential in future years. It will also give us the opportunity to gain more evidence of what types of support work best for young people, thereby informing future decisions on our approach to helping those claimants who are furthest away from the labour market.
5 pm
Claimants who have basic skills needs are already identified and referred to mandatory provision by Jobcentre Plus work coaches. This provision includes English and maths learning, and for those claimants whose spoken English is below entry level 2, we introduced the English language requirement in April this year. However, our proposal in phase 1 is to make the identification and addressing of English and maths skills much more systematic, and to link this to what we know employers want—a workforce qualified to a level 2 standard in English and maths.
Similarly, Jobcentre Plus already offers a range of work-related interventions as part of the youth contract—for example, work experience, sector-based work academies and timely careers advice—but there is currently no systematic requirement for young claimants to undertake such provision at any particular stage of their claim. We believe that that cannot be right, particularly for those claimants who have become long- term unemployed. Our proposal in phase 2 will therefore ensure that 18 to 21 year-old JSA claimants who reach the six-month point of their claim must undertake some work or skills-related activity as a condition of their continued receipt of benefit.
These regulations will allow the department to select and refer suitable claimants to participate in the pilots. Under phase 1, 18 to 21 year-old JSA claimants will be asked to provide evidence of their qualifications in English and maths at their initial work-focused interview in the jobcentre. Claimants who cannot provide evidence of such qualifications at level 2 or above, and who do not have more pressing barriers to work that need to be addressed as a priority such as homelessness or drug addiction, will be selected to participate in phase 1 and mandated to attend an assessment with a training provider. The provider will assess the level at which the claimant is operating in English or maths or both, and check for IT skills. Claimants whose skills in English or maths are at level 2 or better, or who do not have the IT skills required to participate, will be deselected. This is to ensure that only claimants who will actually benefit from the training and can fully take part will be required to continue participating. This will ensure that no claimant is set up to fail under phase 1.
On receipt of the assessment report from the training provider, the work coach will randomly assign those claimants who have been assessed as suitable to continue participating in phase 1 to one of three groups: a control group, an online group or a blended group. Claimants in the control group will follow a traditional JSA claimant journey and receive the usual menu of Jobcentre Plus support from their work coach. Claimants in the control group will be monitored for evaluation purposes. Claimants in the online group will be mandated to English and/or maths learning delivered solely through online means, supplemented with virtual support from a tutor via phone calls, video link and other remote channels. Claimants in the blended group will also be mandated to English and/or maths learning but in this case the delivery, while largely delivered online, will also include classroom-based learning.
In the procurement exercise for phase 1, great emphasis was placed on the need for innovative approaches to the delivery of learning, and the need for individualised learner journeys. We expect the learning to engage claimants in a way that traditional methods may have failed to do, and it will be contextualised to the world of work in order to emphasise its relevance for jobseekers. Claimants will be able to access the online learning through their own IT equipment, including tablets and mobile phones, through equipment sited at provider premises or through other venues such as public libraries.
This provision has been designed from the outset to fit in with the restricted availability of carers, claimants with disabilities and other vulnerable groups. The predominantly online nature of the learning will enable claimants to pursue their learning at times and in venues that suit them and to fit it around other commitments that they may have, such as childcare. The specific needs of disabled claimants will be provided for through specialist software packages and IT equipment.
Certain claimants will not have the underlying abilities that are required for phase 1 and will not be selected to participate from the outset or will be deselected from phase 1 at an early stage. For example, those claimants with poor spoken English, insufficient IT skills to benefit from online learning, or English and maths skills below entry level 1, will not be selected for phase 1
even if they meet the criteria since they will not be able to fully participate. Finding other more suitable interventions to address these skills gaps will be a greater priority. At a later stage, claimants who despite making a genuine attempt to learn, simply find that they are unable to cope with the demands of the learning, will be deselected. The aim of phase 1 is to improve claimants’ skills in English and/or maths by one level from that originally assessed. We will not be mandating claimants to sit exams, but we believe that those who have progressed through the learning will wish to gain a recognised qualification after their hard work, and work coaches and providers will emphasise the value of doing so.
Under phase 2, all 18 to 21 year-olds still on JSA after six months will be interviewed by their work coach to identify what work or skills interventions would be most appropriate to move them closer to the labour market. Some will already be undertaking appropriate activity, but for those who are not, we believe it right that they should take up the offer of appropriate provision. In the majority of cases we anticipate that this will be a work experience placement, although other options include sector-based work academies, a traineeship, and the mandatory work activity scheme. Some of these options are voluntary, but if a claimant declines to take up a voluntary option, they will be required to undertake a mandatory work activity placement or other mandatory provision.
For both phases, claimants will continue to be subject to the conditionality requirements of JSA and will be expected to be available for, and actively seeking, employment. Sanctions will apply to those claimants who do not participate in the pilots without a good reason. This means that where claimants are unable to participate due to, for example, issues relating to internet access or problems with IT equipment, or for isolated instances where an emergency prevents them from attending an assessment or learning, they will not be sanctioned. Sanctions will apply to those claimants who fail to participate without any good reason, not to those who through no fault of their own are unable to participate. The sanctions regime allows claimants to provide an explanation before they are sanctioned and to appeal if they believe the sanction to be unfair.
We believe that the measures proposed in these regulations will give the young people who participate in the pilots a real opportunity to enhance their skills, gain experience of work, and pull themselves out of the benefit trap and into sustained employment. It will also give us the opportunity to further refine the support we give to young people. Nowhere else in the OECD is such a systematic approach being taken to address the literacy and numeracy needs of welfare claimants; in this we will be an exemplar. These pilots offer the potential to impact the lives of thousands of future claimants who will benefit from the insights gained, enabling them to avoid the scarring effects of unemployment and to build better futures for themselves and their families. I beg to move.