Why we’re introducing a Compulsory Jobs Guarantee

10th March, 2014 9:35 am

For generations in Britain, when the economy grew, most people got better off with it. But that isn’t true anymore. Especially for young people.

The number of young people left on unemployment benefits for over a year has doubled since 2010 under David Cameron’s government. The latest figures show over 50,000 young people have been on the dole for over 12 months. Its increasingly clear that the government has failed miserably to give young people opportunities to learn, train and find a job. Just six per cent of the wage subsidies on the government’s flagship Youth Contract scheme have been used and less than one in five young people referred to the Work Programme have found a job.

The cost the government’s failure is huge. Long-term youth unemployment is currently costing taxpayers £350 million a year. And the cost of dealing with long-term youth unemployment over their lifetime is a staggering £3.2 billion.

We believe it’s completely unacceptable that taxpayers are paying for the government’s failure to get young people off benefits and into jobs. The next Labour government will give young people opportunities to get on in life rather than being cast aside under this out-of-touch Tory-led government.

This morning Ed Miliband, Ed Balls, Rachel Reeves and I have announced a Labour government will introduce a Compulsory Jobs Guarantee.


Labour’s Compulsory Jobs Guarantee would mean every young person out of work for more than 12 months will be given a paid starter job. Work they will have to take up or lose benefits. Labour will work with employers to help fund paid work with training for six months. It will mean paid starter jobs for over 50,000 young people who have been left on the dole for over a year by this government.

The Compulsory Jobs Guarantee will also apply to adults aged 25 or over out of work for two years or more and will be funded for the whole of the next Parliament by: repeating Labour’s successful tax on bank bonuses at the start of the next Parliament; and restricting pensions tax relief for people earning over £150,000 to the same rate as basic rate taxpayers.

With bank bonuses soaring yet again this year we believe it’s only fair to pay for our Compulsory Jobs Guarantee by repeating Labour’s tax on bank bonuses.

If you question whether this positive approach to tackling long term youth unemployment could work, look no further than Wales. The Welsh Labour government is running an impressive employment programme called Jobs Growth Wales.

The programme is aimed at for 16 to 24 year-olds and pays employers to take on young people for six months. 80% of the Jobs Growth Wales positions are in the private sector and over 80% stay in work after end of the programme. Last Wednesday Rachel and I visited an international software company, Sapiens, who have taken on young people through Jobs Growth Wales. We met 4 young people who had been taken on as trainees. They had all found it extremely difficult to find a job. One had applied for hundreds of jobs,  but despite impressive qualifications had failed to get a single interview. thanks to Jobs Growth Wales the four young people were able to gain vital experience and skills in a paid job and have now been taken on in full time roles by Sapiens.

Jobs Growth Wales shows the difference Labour can make to the lives of thousands of young people denied an opportunity to get a job under the Tory-led government. Recently the Tories have condemned Wales as ‘a nightmare vision’ and criticised Jobs Growth Wales. Doesn’t this show how out of touch they have become with the lives of working people?

Under David Cameron far too many young people are struggling to find work and are not seeing any economic recovery at all. Labour’s Compulsory Jobs Guarantee will give thousands of young people hope in the future, with a paid job and the opportunity to get on in life.

Stephen Timms MP is Labour’s shadow Employment Minister

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  • Steve Stubbs

    Two questions please.

    How many times is that now that the same bankers bonus tax has been promised for various things, and which will in fact get the money?

    ‘Subsidised starter job’. WTF is that when it is at home? How many real full time jobs will not be created or even removed to make space for a subsidised job at greater profit to the employer concerned?

    • Steve Stubbs

      To continue – actually thinking about it, this is just a compulsory version of the YTS scheme of old, when significant numbers of jobs were declared redundant and then replaced by YTS people. Or is it in fact WORKFARE by another name?

      • BillFrancisOConnor

        What do you suggest? Follow Dave, George and their pals and leave them to rot on the dole, destroy their hope and ambition and generate another cycle of worklessness?

        • Steve Stubbs

          Of course not. You do not reinforce failure. I would start with setting a realistic minimum wage, and then removing benefits for failure to take a minimum waged job within sensible travelling distance, say a radius of 2 miles via the shortest practicable route,. We have got to remove the incentive to sit on your jack watching Jeremy Kyle as a lifestyle. At the same time stop unskilled immigration from outside the EU. Also set the tax threshold at the minimum wage level for a 38 hour week annualised and absorb NI into tax. I emphasise start. – I could go on.

          • treborc1

            Threat of sanction are for the middle class to let them know no need to vote Tory you can vote labour we will hammer down on them.

            Reeves has stated she thinks that the private sector will take the most of the 50,000 people who will be offered these jobs over the five year period that’s just ten thousand a year, that’s a bloody drop in the ocean.

            Band wagons again try and out do the Tories.

          • AT42

            We have got to remove the incentive to sit on your jack watching Jeremy Kyle as a lifestyle.

            I hate it when my party goes along with this agenda. Most people are desperate for work! Recently a coffee bar (I think it was Costa) advertised a few jobs – they got nearly 2000 applications!

            Calling it Compulsory makes me think that our leadership has fallen for the stories about ‘skivers and scroungers’. It may be of course that they actually know that these jobs are not much use and anyway they’ll be sacked as soon as the year is up so new free(to employers) labour can be taken up. people out of overpriced

            To be credible Labour needs to be far bolder and far more innovative.

            Furthermore if we stop paying ATOS and co, and use the money to build houses we create jobs and get people out of expensive private lets. This is turn will save millions in housing benefit.

            Oh and yes reverse the tax cut for the rich, so what if they leave the country? (most probably won’t anyway) You can be sure that the money they saved in taxes mostly didn’t stay in this country anyway. Any relief given to the poor gets spent in this country which again is positive for the economy.

            In a just society an economy is run for the benefit of the majority (i.e.ordinary people). This economy is run to benefit the rich the very people who have more than enough already.

            Oh and in 1945 we were in a far worse situation than we are now – look what we did then!

          • Steve Stubbs

            Of course most people are desperate for work. I am not suggesting otherwise, but there are those who are prepared to play the system and not work through choice (see my reply to BillFrancisOConnor). There may not be a huge number but one is too many. I can name 5 offhand. So nationally there must be thousands. If a system is capable of being abused, someone will abuse it, whether we are talking benefits or tax.

            Disclaimer – I have never drawn any benefits other than family allowance when the kids were little and my pension now. I was never unemployed during my whole working life and paid my taxes.. So watching scum playing the system really gets up my nose.

          • BillFrancisOConnor

            ‘We have got to remove the incentive to sit on your jack watching Jeremy Kyle as a lifestyle’.

            Nothing like a bit of stereotyping to debase the argument.

            What you have repeated here is a great big fat Daily Mail/IDS myth.

          • Steve Stubbs

            Well I don’t read the Mail (if I wanted a comic I would probably get the Mirror) but I can name at least 5 ‘myths’ that I know who will not work and would rather draw benefits.

            I am not suggesting and have not suggested that they are a majority, but if I can name 5 I reckon the posters on this website could name at least three figures worth between us.

            One is too many – they have got to be stopped. The temptation to get onto the anonymous reporting of fraud people is quite high. Not sure why I have not done it before.

          • BillFrancisOConnor

            There may be some people playing the system but they are a tiny minority. Any system of social protection will be open to abuse but that’s a price worth paying to protect a great number of families from going below the breadline. The only way of completely avoiding abuse is to have no system of social protection at all – we’ve tried that approach and history tells us what happens when no system of social protection exists.
            Anyway anything to say about scroungers and parasites like Phillip Green or Ashcroft who earn hundreds of millions of pounds in this country without paying any tax on it or the CEO of RBS who is rewarded with millions of pound of bonuses for losing billions of pounds of taxpayers’ money?

          • Steve Stubbs

            Well yes. If people are evading tax they should be banged up as it is illegal. However if they are using legal devices to avoid tax that is legal under the law as it stands and the solution is in the governments hands. Change the tax system to close the legal loopholes they are using, and which they were using all through the last Labour government as well. The main device used now by big corporations to avoid corporation tax was actually introduced during the last labour government by one Gordon Brown, as advised by Ed Balls. You will note they are not saying anything to remind us of that!

            Governments of all persuasions have consistently hammered those who come under PAYE, whilst letting their friends get away with it.

            You seem to think I would be in favour of that. Far from it.

          • JoeDM

            ” At the same time stop unskilled immigration from outside the EU.”

            And what about the immigration from the eastern and southern EU states?

          • Steve Stubbs

            It’s called the EU treaty on free movement of people, under that they have the right to come here.

            Personally I would vote to leave the EU if I had a say. Then we could also stop them as well. Can’t see me voting for Farage though.

    • Mark Reilly

      It appears to be similar to the Jobs Growth Wales, which has been working successfully as stated..

      “The programme is aimed at for 16 to 24 year-olds and pays employers to take on young people for six months. 80% of the Jobs Growth Wales positions are in the private sector and over 80% stay in work after end of the programme.”

      Obviously you can never guarantee that an employer is taking money for a job they would have created anyway, but if 8/10 long term unemployed – who have always found it hardest to get back into the jobs market – remain in work at the end then it is probably a price worth paying.
      It may also mean that employers look at local workers rather than import trained workers from other parts of the EU, which will also be beneficial

      Obviously we could leave it to Market Forces and hope that wealth trickles down from the 1%..because that has worked so well

      • treborc1

        It’s not working well in Wales at all, Wales tells people leaving school get a job or go onto the work program or go to College most of the kids go to college and get EMA. My grandson is now 20 years of age and he is still in college he now gets a grant, it was either that or a job in McDonald, that is what they offered him.

        Many of the kids are working in charities these charities use to offer people like me unpaid jobs but now they get these kids free.

        same as the big retailers, but is that going to get people into employment once the six months are over these people are again back onto benefits.

  • carlton temple-powell

    Hopefully this policy will end exploitation of the unemployed through unwaged ‘work experience’, which is the only thing the Tories have to offer. The Compulsory Jobs Programme is a big idea the Tories dare not copy. Clear blue water!

    • treborc1

      Only 50,000 people will get this offer so what happens to the other 950,000 who are young and unemployed.

      • carlton temple-powell

        I would like to see the scheme expanded too but it has to gain the confidence of the public first, it has to show that it can work, then the public will see it is money well spent, well invested, and will back its expansion.

        • David Battley

          If the scheme needs public support before it can be expanded, then it would need to be of sufficient scale to be noticed: 50k may well be too modest to achieve this aim.

  • treborc1

    How about a year not six months, and a trade learn them a trade, six months of working for a council or Tesco filling shelves may look good to the middle class, who think the working class live on the dole.

    Yet if you learn people a trade you give them the chance to work at something to make a living, picking up litter will do little.

    This is all about being seen as being hard on the working class, after all the middle class would never be on benefits would them.

    But what a waste of money if you do not give people the trade and all you do is take the bonus tax from bankers who will I’m sure turn around and find another labour loop hole to get out of it.

    You want the young to work train them given them skills not the skill to pick up litter, but the skills needed to get employers to look at them not so person from Poland.

    • BillFrancisOConnor

      You said that you’re voting UKIP. What’s their policy on the young unemployed?

      • Doug Smith

        People don’t vote UKIP because of their policy on the young unemployed. They vote UKIP because they’ve had enough of the LibLabCon elite.

        • BillFrancisOConnor

          You know the mind of every UKIP voter do you? Knicked a mind reading tool from Mystic Meg?

          • Doug Smith

            Nothing coherent to say about the appeal of UKIP?

          • BillFrancisOConnor

            There are a whole range of reasons why people vote UKIP- not just one.

          • Doug Smith

            You’ll find that my position is supported by Ford and Goodwin’s recent book ‘Revolt on the Right: Explaining Support for the Radical Right in Britain’.

            Goodwin and Ford’s analysis is based on evidence provided by over 100,000 voters and almost 6,000 UKIP supporters. It found that an intense dissatisfaction with the established political class was a main motivation.

          • BillFrancisOConnor

            Not true – They argued that there are a whole range of reasons to explain why more voters are turning to UKIP and included immigration and an anti-EU mindset as significant factors.

          • Doug Smith

            The Tories have offered everything UKIP want but UKIP support remains steady and they take votes from Labour also. UKIP continues to win support from those who have concerns over immigration and the EU because of the loss of faith in mainstream politicians.

            Btw, info I’ve provided is quoted direct from the publisher’s press release.

          • BillFrancisOConnor

            So you’ve not read the book then?

          • JoeDM

            “The Tories have offered everything UKIP want…”

            Cameron has said time and again that he would always campaign for the UK to stay IN the EU !!!

      • treborc1

        Tory Lite party offers 50,000 people a chance of six months work at benefits rate, 25 hours a week and then has to tell us he will stop the benefits of anyone refusing.
        Hard as the Tories is our Miliband.

        But then labour says this will last five years does that mean he’s only offering 10,000 people work for a year, five years 50,000.

        We have we are told by labour since 2010 one million unemployed it’s now 2014 and we still have a million unemployed so why not offer all those young people a chance.

        Band wagons again and yes I will be voting UKIP

        • BillFrancisOConnor

          What are UKIP offering the long term young unemployed?

    • JoeDM

      But even with a trade they will be paid a pittance due to the competition from immigrant workers.

  • charles.ward

    Will the employer be able to fire the employee if they don’t do the job properly? If the employee is fired will they lose some or all of their benefits?

    Come to think of it how much of their benefits will they lose if they fail to take up this offer of work?

  • markmyword49

    We’ve heard it all before from the last Labour government. They promised jobs for all the 18 – 24s and those out of work for over two years. What we saw were schemes that were used by most employers to fill positions temporarily and get paid by the government. What we saw was an increase in zero hours contracts and minimum wage positions plus employers working the system so they didn’t pay the minimum wage. I don’t believe Labour have thought through the consequence of this policy. It will need far more oversight than they put into their last scheme.
    So you’re going to find the money by a tax on bank bonuses and dropping the 45% to 20% rate for pensions earning over £150k. Its risible to think the peanuts that these will generate is enough to create a properly funded policy.
    I’ve no doubt that employers are already working out how to gouge the government

  • Pingback: Labour’s jobs guarantee – addressing the big questions | Notes from a Broken Society()

  • Peter Martin

    There’s a difference between a job guarantee involving meaningful work for the public purpose and workfare – giving free labour to private businesses which therefore have less need to pay for it.

    I’d like to think the Labour Party was talking about the former rather than the latter!

    Is Stephen Timms able to give any re-assurance on that point?

  • Dan

    I’m sorry, but this is pathetic. That scheme in Wales (which this is apparently based on) has had virtually no effect whatsoever; the Jobseekers count is still astronomically high. That’s not a surprise at all because you can’t make such a radical change as you’re suggesting with such miserly sums that you’d raise from something like cutting pension relief — you will need to stump up a HUGE amount of cash to achieve anything close to the scale you’re suggesting.

    This is a perfect example of how moronic Labour’s current stance is, by committing to running a surplus and making big spending cuts on the one hand, but yet at the same time claiming you’ll mysteriously magic up all these new things without any money. Either start making the argument for government spending and fight the hysteria about the deficit, or you may as well just pack up and go home.

  • Monkey_Bach

    Considering the numbers involved since, I believe, most of these job guarantees will involve companies and firms in the private sector, even if money for the scheme is extant how can Labour possibly promise to quality job guarantees which include worthwhile training and qualifications to every person eligible?


    • BillFrancisOConnor

      Read up on your Keynes.

      The job does not have to be private sector it could be a public sector or third sector job. It will also be compulsory for the employer to provide training to the young person that they take on.

      My son is 17 he desperately wants a job but can’t find work- it could open gates for him.

      • Monkey_Bach

        I am aware of Keynes and how Franklin Delano Roosevelt put his ideas into practice in America in the thirties with his “New Deal” which helped pull that country out of a slump. As far as private involvement goes with the Compulsory Job Guarantee it was Ed Balls and that useless sack of sh*t Stephen Timms who claimed that “most” of the Compulsory Job Guarantees would be created within the private sector.

        Based on the way Labour has acted in the past my fear is that when an unemployed person has been workless for one or two years they will arbitrarily have to do “something” as far as the Compulsory Job Guarantee goes and will be shoehorned into whatever opportunity happens to be going at the time, which may or may not be beneficial to them in the long run. This is exactly what happened with Labour’s New Deal and Flexible New Deal – Labour plagiarised the name of Roosevelt’s schemes: at a certain point in time the people affected arbitrarily simply had to participate under the rule no matter whether a suitable opportunity was available and a lot of them ended up doing menial duties for thirteen to fifty-two weeks, like petty criminals serving sentences of community service, gaining no skills and/or qualifications immediately being signed back onto the Jobseeker’s Allowance.

        My fear is that the Compulsory Job Guarantee is more about Labour being seen to be “doing something” about the unemployed, the idea being that giving something and some sort of structure to the lives of the unemployed will prevent them from giving up and becoming moribund. I cannot see, given the numbers involved, that placements could be individuated so that the people involved really were helped to become whatever it was that they thought best suited them; I think the scheme will fail because it will be done inflexibly and by the numbers.

        And the fact that useless sack of s*it and UNUM buddy Stephen Timms is at the forefront of the scheme only makes matters worse. Best he go back to thinking about indices and surds and make way for a person more dynamic and capable.


        • BillFrancisOConnor

          Leave them to rot on the dole and destroy their ambition and hope then? That’s what the party you voted for in 2010 support along with their Tory friends.
          Youth unemployment is a national emergency and we have to do something credible about it.

          • Monkey_Bach

            I didn’t say that or anything like that. In a nutshell I said that in my opinion the Compulsory Job Guarantee will be no more successful than other schemes that preceded it because too little money will get spent on too many participants, over too short a period, to benefit many of them in the way they deserve.

            Here’s one interested blogger’s take on it:


            CJG won’t just affect the young. Everybody over twenty-five unlucky enough to be unemployed for two years will end up on it; even relatively elderly people will be conscripted.



          • BillFrancisOConnor

            What should be done then?

            Look it isn’t perfect but there’s an emergency situation and it requires costed and credible measures to deal with it. Having young people on the dole without hope or a future for extended periods of time is criminal. What Labour is proposing is a band aid but it’s much better than anything the party you voted for in 2010 are proposing.
            But of course Cameron’s hand ringing pals would say anything to get elected (see the ‘abolition of tuition fees’ rubbish that you fell for in 2010 for example) and when they deliver Jack s**t they’ll be lots and lots of bogus ‘extreme concern’ and ‘genuine worry’ which no doubt guys like you will fall for (see your laughable and obsequious praise of Sarah Teather). We’re not talking cloud cuckoo deception here but practical and costed measures to deal with the disastrous effects of a rampant and out of control neo-liberal capitalist order.

          • Steve Stubbs

            You didn’t answer the question you started with, but in your role as the official opposition (you seem to oppose all and any suggestions) I notice you never seem to offer solutions.

            Can I suggest you take the advice on the philosopher Confucious ” It is better to light one candle rather than stand shouting at the darkness. “

          • BillFrancisOConnor

            What are you talking about? I support the Labour Party’s proposals in respect of youth unemployment – you don’t.

          • Steve Stubbs

            Which ones? The last lot which proved to be as much use as a chocolate fireguard, or the latest rehash of their workfare plans – work for the minimum wage or else lose your benefits in a subsidised job that will displace real workers to maximise the profit for the employers?

  • Preston Christian Action Netwo

    The problem is the “compulsory”. we all know government policy on benfits sanctions is to humiliate and make destitute the jobless on the most flimsy pretext and that this is causing great distress and the rise in food bank use. We need policies that really incentivise young and workless people to co-operate and better their chances… not punish them further if they are not able to do so through depression, lack of confidence, distrust of the system.. More carrot and less stick please.

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  • Theoderic Braun

    I wonder what well qualified and experienced men and women in their late fifties and sixties, possibly after decades of uninterrupted work, will feel about being drafted onto the compulsory work guarantee after two years of unemployment. Will people who start the programme close to retirement have to compete the six month part-time job if they pass beyond the official retirement age while still on it before it ends?

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