Jobs and the Unemployed

Debate between Mary Creagh and Steve Rotheram

Wednesday 7th July 2010 Commons Chamber

[Mary Creagh]

I think that we should have both. I do not think that 50,000 apprenticeships will be enough; nor do I think that cutting Peter to spend money on Paul is a fair way to allocate resources.

[Steve Rotheram]

I am a product of something similar to the future jobs fund. In the late 1970s, there was something called a pre-apprenticeship scheme. I did six months on that and was very fortunate to complete it. The scheme was not just academic, as it gave me some transferable skills. It taught me to get out of bed and it led me, in later life, to do a master’s degree in contemporary urban renaissance. That is the sort of opportunity that the future jobs fund is providing.

[Mary Creagh]

I thank my hon. Friend for that intervention. He truly is a renaissance man, and I hope that many of the young people whom we met who got their entry-level work through the future jobs fund end up sitting on these green Benches. I hope that they can make the same incredible progress and journey that he has made in his life.

I turn now to the Work programme set out by the Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling). I have a great deal of concern about it. In a speech on 27 May, the Secretary of State spoke about

“a single scheme that will offer targeted, personalised help for those who need it most, sooner rather than later”.

If it is a matter of sooner rather than later, why are we waiting until next year for it to come in? I suppose that that has to do with the fact that the Government want to set up what I presume is a national contract with large-scale training providers. I tried to intervene about this earlier, because the Government are asking those providers to bear the risk of training people even though their contract payments will depend on outcomes.

That raises a series of questions. First, at a time when deflation, very low growth or even a double-dip recession are all possible, why does the Minister think that the private sector will turn to the banks for loans to cover this training given that, as we heard earlier, the banks are averse to risk and not very good at lending? Output-related funding is currently calculated on the basis that it takes six or nine months to get a person into work and then 13 weeks to ensure that he or she has lasted in that job. Why does he think that organisations in the private sector such as Capita or BT will line up to take on the massive risk involved in training people and employing them, when there is such a huge amount of uncertainty?

I have another question for the Minister, and I will give way to him if he can answer. How does he think voluntary sector organisations such as Nacro—the National Association for the Care and Resettlement of Offenders—will be able to do this? Such organisations have specialist programmes working with the most difficult, hard to reach and disadvantaged people—prisoners, young offenders and ex-offenders. They have the benefit of being present in and running training courses in prison and are then able to offer some sort of continuity when the offender leaves. I am also thinking of providers such as Rathbone training, an organisation that I had the privilege of serving as a trustee for seven years. These are small-scale organisations—Rathbone’s turnover when I left it in 2005 was £40 million. Why does he think that they will go to the bank—or their trustees would say that they should go to the bank—and borrow up to £20 million at a time, with a personal guarantee of the trustees, who are jointly and severally liable, who are for a programme when it is not clear that they will get the rewards from it?