
Life is tough in Britain at the moment. Ask yourself how many members of your family and friends are either under threat of losing their job, or have been made redundant. I bet you can name a few, wherever you live. If someone loses their job, in our party, we want them to get all the help they need to get back into work. Employment matters to us. In 1997, Labour came to power with an electoral mandate for a new Welfare-to-Work programme: the New Deal. Named after the iconic programme that defined American economics for a generation, our version comprised a guarantee that anyone claiming out of work benefit for some time is required to take up a work placement or training.
It’s important that we remember what we did. We said to the country: everyone who can should work. And in the decade between Tony Blair walking into number 10, and the collapse of the subprime mortgage market that sparked the global banking crisis, our Labour government changed, unrecognisably, what happens to you if you need out-of-work welfare benefits. Gone were the Full Monty-style benefits offices, and in came Job Centre Plus, bright and full of IT, unlike the often dirty, depressing building they replaced.
Never, ever, let a Tory tell you Labour did nothing to change welfare. Thanks to Labour ministers, from Harman to Cooper, our country is now recognised around the world for what is known to economists as ‘interventionist labour market policies’. Or, to the rest of us, giving people a hand into work.
But this won’t stop the Tories trying. Enter Chris Grayling – Tory Minister for Work. Last week, the Speaker awarded me an adjournment debate on young people and employment in Wirral. I wanted to raise some questions about the prospects for young people in Merseyside and some queries about the Government’s plans. Instead of a serious discussion about the future, I was treated to a somewhat biased history lesson.
Labour campaigners need to be ready for this. It suits the Tories just fine to rebrand our ideas as theirs, whilst denying any progress between 1997 and 2010. It’s a strategy to unpick us at our core. But we can’t let them do it. So if you hear the following myths, don’t hesistate to set the Tories straight.
1. ‘They had 13 years of unprecedented economic growth, and they spent billions of pounds on welfare programmes, but the number of people on out-of-work benefits…remained stubbornly high.’ (Chris Grayling MP, Hansard, Tuesday 14 Sept 2010, col. 857)
On whether people returned to work under Labour, Grayling is disingenuous at best. According to DWP Work and Pensions Longitudinal Study (August 2009) in 2009 there were 610,000 fewer individuals on out-of-work benefits than there were in 1997 – and that is after the global downturn had hit. A year previously, in 2008, the figure was 1,230,000 below that for 1997.
So we need to tell our story clearly on the doorsteps: fewer people needed out-of-work benefits under Labour – when the economy grew and during the recession.
2. ‘The level of young people not in employment, education or training has remained stubbornly high throughout the past 13 years, and is higher now than it was in 1997.’
This is a convenient stat for Grayling to use. Of course the Tories want to compare 2010 with 1997. But no economist would. In 2010 we are recovering from the worst shock to the world economy since the thirties. In 1997, the economy was growing steadily and had been for a few years. The right comparison is with 1992. And Grayling’s time-trick masks an important fact. Check out Table 1 here in the Department for Education’s latest statistical release. Look at the peak in young people not earning or learning in 1992 – higher than at any time under Labour. During the recession the Tories brought about.
Labour supporters need to campaign for young people to get a good start to their careers. But don’t let any Tory fool you. When they were last in power during a recession, more young people were kept from the labour market. Through the Future Jobs Fund and the New Deal, we kept numbers stable when the economy crashed.
3. ‘The big problem that we had with the New Deals was that they were effectively programmes designed in Whitehall. The standard New Deal format was 13 weeks in a classroom, with relatively little financial focus on outcomes or whether people got into work at the end…The placements happened, but as for the outcomes of the different New Deals-yes, they got some people into work, but the number who stayed in work was disappointingly low.’
No government programme, plan or policy is immediately perfect. Through our period of office, we changed and reformed the New Deal as we learnt what worked. The government was in the process of introducing the Flexible New Deal that would bring in more organisations in to help people find jobs and gain the skills to join the workforce.
But there is plenty of evidence to demonstrate that the New Deal (in its various forms) has had a significant effect on reducing unemployment. Every study into the effect of the New Deal has demonstrated that it has done much to improve employability.
A study by the Tories’ favourite, the Institute for Fiscal Studies, in 2005 found that employability was increased by around 6-7 per cent for New Deal for Young People attendees. Research by Duncan McVicar (Queen’s University Belfast) and Jan Podivinsky (University of Southampton) in 2009 found that in every region of the UK, the New Deal had reduced the hazard of long-term unemployment.
It is highly unlikely that the Labour government could have achieved the huge shifts of people back to work had it not been for the visionary New Deal programmes.
So the next time you hear someone spouting the Tory myth that Labour didn’t change welfare: please, on behalf of the million people that returned to the dignity of work under Labour, put them right.
Six hundred thousand fewer people were claiming ‘out of work benefits’ in 2009 than were in 1997. It aint much of a proud boast, is it? What’s the difference in the number of claimants between ’97 and 2010? Is it still fewer? Even if it is, I wouldn’t have thought that particular statistic will impress the electorate much. Actually, this is exactly the kind of dry number puking that gets people’s backs up. Alison, please don’t use 2009 employment figures during the current period of opposition, it makes us look mad.