Labour announce compulsory work scheme for long term unemployed – and those who refuse to take part could lose benefits

3rd January, 2013 11:08 pm

Ed Balls and Liam Byrne are set to call for a compulsory Jobs Guarantee for long-term unemployed adults. In an article for PoliticsHome Ed Balls will say that, under the jobs guarantee, government will ensure there is a job for every adult who is long-term unemployed (initially those out of work for 24 months or more) and people out of work will be obliged to take up those jobs or face losing benefits. Labour would aim to expand the scheme over time to include those out of work for 18 or even 12 months. Balls describes this as a “One Nation” approach to welfare, saying:

“A One Nation approach to welfare reform means government has a responsibility to help people into work and support those who cannot, but those who can work must be required to take up jobs or lose benefits as a result – no ifs or buts.”

There are currently 129,400 adults over the age of 25 who have been out of work for 24 months or more – a rise of 88% since the same month last year and a rise of 146% in the last two years.

The scheme would cost around £1 billion, which the party would fund by reversing the government’s decision to stop tax relief on pension contributions for people earning over £150,000 being limited to 20%.

Although the Tories will no doubt claim that this scheme is being introduced to try and distract from Osborne’s tactical games over welfare cuts, sources close to the Treasury team indicated that the policy had been in development for several months, and pointed to a pamphlet from Stephen Timms MP outlining a jobs guarantee last January.

Although the language of the policy is couched in terms of what the government could do now – and this policy is not certain to be in Labour’s manifesto yet – it seems likely that this is one of the first major 2015 election policies to be announced.

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  • Very good news indeed. Bill Mitchell and other heterodox economists have been arguing for a government jobs guarantee for many years.

  • Cuchulaindundee

    I dispair about Labour Party policy making. Its as if the members and affiliates dont have a say through the policy forum process. Hope these jobs are on Minimum wage. wonder what John Cruddas has to say about this. i dont believe in Coeporate slavery. not very socialist.

  • Compulsory corporate slavery, then. Call yourselves bloody socialists; you’re a disgrace to the once-great Labour Party.

    Meanwhile, the last Jarrow Marcher died the other day. One dreads to think what Ellen Wilkinson would have thought of ex-Rothschilds investment bankers like Byrne playing God with the unemployed.

  • Guest

    I’m assuming I haven’t woken up in some paralel universe where a shadow Labour Chancellor and Work and Pensions secretary are contemplating nationalisation

  • Where do these jobs come from? If people are not applying for them now then they’re either procrastinating, playing the waiting game or there are no jobs for them to apply for. If the former then presumably we’d go down the Ian Duncan Smith route and reduce or stop benefits.

    I don’t see how a government can create jobs without some sort of nationalisation policy or public works or something along those lines? I’m not against that but Ed Balls and Liam Byrne don’t strike me as people in favor of that sort of thing, maybe I’m wrong. It will be interesting to see what skills packages we offer people to be able to get one of these jobs, if they’re unemployed that long there’s likely to be a deficit somewhere.

    • On the face of it, it doesn’t sound very dissimilar to the Tories workfare programme. It sounded OK until the stick was benefits cut. A future Labour Gvt would do better to encourage people to start their own home based business like I’m doing – coops , network marketing, sole trader, family businesses. The ‘job’ is no longer the way to go now – it’s a monkey trap and just continues the same failed capitalist system that got us into the mess we find ourselves in.

      • Except that stick has ALWAYS been there…. if you refuse a job offer while on JSA you loose benefits… so whats new?

    • AlanGiles

      Exactly Robbie. You cannot guarantee anything in life except death at the end of it.

      What is this but just the same old Byrne rhetoric that we have had many, many times before – and before that Purnell, Blunkett, Cooper, Johnson

      Pie in the sky and promising something that cannot be delivered, especially when you have in some areas of the British Isles more than 50 people all competing for one job.

      It’s policy on the hoof again, or non-policy until Crudas comes down from the mountain with his tablets of stone – except the stones will be made of balsa wood

      • aracataca

        I think this is why I find you so incredibly annoying. You repeatedly ask us to come up with policies. When we do- you dismiss them out of hand, immediately and without reservation Isn’t this a costed, fair and sensible proposal to put people who have been unemployed for a long time back to work.

        • AlanGiles

          As others have said, unless Labour renationalise industries, they cannot FORCE a private employer to take on anybody – they can encourage, perhaps even co-erce (though I doubt that modern Labour would have the backbone to do that).

          Companies are downsizing more and more. Many retail businesses are becoming a web-only presence (for example Woolworths and Argos two of the biggest names at one time on the High Street). It ) is highly likely according to the BRC that more big names will disappear from the High Street this year. As for manufacturing (or should I say) re-assembling, how do you make employers take on staff they don’t need.

          As for Yvette Cooper having experience of unemployment (in the following message) – well, she did alright for herself in the end, but not everyone can crawl their way to the top at Westminster. Please don’t offend the unemployed by pretending just because a former cabinet minister got lucky it can and will happen for everybody.

          Your obsession with Natalie Bennett, Caroline Lucas and the Queen is duly noted.

          • aracataca

            Of course as this would be a publicly funded employment scheme the long term unemployed could be given a post within public service positions. The government would essentially be paying the labour costs (including wages) of the person employed so whether that person is employed by a public service or a private company would be immaterial. In this regard there could be a significant degree of direction within the scheme.

          • The FJF was mostly public and voluntary sector. I don’t have any problem with that. The fact is that it is hard to get back to work after a long time out and private sector employers in particular don’t want to know

          • There is no such thing as a ‘job guarantee scheme’ without nationalisation or a public works programe. Are you suggesting that the government subsidise the wages of the long term unemployed to make them more attractive? That might work but it still relies on somebody hiring them which you can’t guarantee.

            Additionally, this group of people are extremely unlikely to be suited to public service positions if they have been out of work for such a long period they’re likely to be ‘the most unemployable’ so they will need training etc. What do you do with the hundreds of thousands of people without GCSES for example or relevant work experience?

          • aracataca

            Well no-these jobs could be found within an existing or expanded public sector as well as the private sector. The difference in labour costs between private and public sector employment would be immaterial as the labour costs for either would be found from the cut in pension tax relief for those earning over £150k per year.

          • Labour is not opposing cuts to public services. There position was too deep too fast and that only applied in 2010-11 after which the level and depth of the cuts are virtually the same. Why support cuts to the public sector typically councils (Labour councils in many instances doing the cutting) only to fill it up again with the long term unemployed? This is smoke and mirrors nonsense.

          • John Ruddy

            Well, you dont force an employer, but if you say to him/her that is you employ this person, we will page their wages, they’d be stupid to turn that down, wouldn they?
            After all, the Labour Government didnt have to force employers for them to take on young people under the Future Jobs Fund at the height of the recession in 2009, did they?

          • AlanGiles

            But John, Private companies will only keep these people in work while they are being paid to do so. Previous schemes in the 1980s when we had high unemployment prove this to be the case. As soon as the subsidy runs out, so do the specially created jobs. You then further demoralise people, often young people, whose confidence has already been dented, who will have to wait until the next job creation scheme comes along, or the economy improves.

            I have said elsewhere, we need to ensure we teach students practical useful skills which are (or we hope will be) needed in the workplace. You really don’t need to teach a lad who wants to operate a lathe, for example,, “media studies”, and we shouldn’t just concentrate on getting as many to university as possible – there is no shame in not having attended university, an apprenticeship for many would be of far greater practical use.

        • girlguide

          I interview young people with a view to employing them as apprentices or for more basic manual work on behalf of my employer. We were persuaded by our local council to take on young people under the Future Jobs scheme – an absolute disaster. They were, to be frank, unemployable, unwilling, and unreliable, and we put in more work trying to persuade them to turn up in the morning on time (or at all) than they did when they eventually appeared. For a private employer it is simply more cost effective to take on the many eager, prepared to learn, young strivers who want to be employed and to get on, than a bunch of people who would really benefit more from going through basic schooling again. Even if the latter’s wages are paid by the government, an employer has to allocate experienced staff to mentor new employees, and in the current conditions it’s better to pay the right people ourselves and have a mutually beneficial experience, than wasting time on people who have an attitude that causes trouble within the workforce. Most private employers are prepared to put in money for training young people but it has to be cost effective. It’s not social work.

          These so called jobs will end up in the public sector, mainly the local council, just as the FJF. Of the 1000 or so short term jobs on this scheme in my locality, 923 were in the local council or voluntary sector.

      • aracataca

        Once again we have the personalisation of this issue. It is perhaps worth noting that Yvette Cooper is perhaps the only person at the top of politics who has had personal experience of being unemployed and drawing the dole. In this regard she differs significantly from your particular pantheon of ‘stars’ such as Mervyn King, Natalie Bennet, Caroline Lucas and the Queen – none of whom have been unemployed and dependent upon welfare ( unless you include the last of these who has of course been dependent on ‘welfare’ for about 60 years now).

    • aracataca

      ‘if they’re unemployed that long there’s likely to be a deficit somewhere’

      Do I detect the unpleasant smell of the demonisation of the long term unemployed here?

  • ovaljason

    Good. Finally some sense from Balls. Compulsory work for anyone claiming long-term unployment benefits. I just hope it really is ‘no ifs, no butts’.

    • Monkey_Bach

      ‘no ifs, no butts’ Butts? What cheek! Eeek.

  • Amber_Star

    It would be great if the unemployed people had some input to where they’d like to work. So, say there was a public service or business which was close to their home that they thought they’d like to work for, they could be helped to make an approach & explain that the government would cover their wages for the first 6 months.

    I think this makes it much more collaborative & could also create a new job because the worker is making the offer, rather than the employer saying there’s an existing position which needs filled. If the employee does well & the employer can afford it, they’ll get kept on in a new job that’s been created at a workplace where they’ve pretty much chosen to be.

    • Gabrielle

      Good points.

  • gwenhwyfaer

    Yes, Labour, the way to win in 2015 is to promise to do exactly what the Tories are doing but be somehow better at it (for a definition of “better” which mysteriously never quite materialises). Because what the electorate really wants is to be able to choose between three parties offering damn near indistinguishable policies.

    Cowards. Useless, worthless, unelectable cowards.

  • Monkey_Bach

    My suspicion is that the so called “Job Guarantee” will boil down to temporary part-time work placements on the minimum wage, little different from workfare since participants will receive too little “pay” to improve their lot while simultaneously excluded from tax credits and similar. I would bet the farm that the quality training necessary to provide participants with real qualifications and recognised experience at a sufficiently high level to lever a small minority into real paid jobs in the new economy won’t be included. (In the past schemes like this have been hopelessly unambitious and often trainees achieved at best an NVQ level 2 qualification or something like an Emergency First Aid or Health and Safety certificate after attending a one or two day course.) And I would bet that like so many of its predecessors the scheme will end up like a revolving door, with people shanghaied onto the scheme passing through it and back to unemployed status, repeating the cycle time and again, without any tangible or permanent improvement as far as their personal circumstances go.

    Timms does outline something slightly better and a little more humane than the currently foundering Tory schemes although, based on what he writes in his pamphlet, it looks as though Labour does intend to keep the Work Programme going, with a few minor tweaks to it financially and procedurally here and there, despite the slew of recent statistics illustrating the Work Programme’s failure. Personally I find it hard to understand why anybody would want to keep pouring money down that particular drain – but there you go!

    Any move away from punitive chain-gang-like workfare is good but this announcement bears all the hallmarks of tabloid appeasing show-boating blended with a hearty dollop of outdated New Labour triangulation.

    Same ole, same ole.


    • John Ruddy

      How will getting the National Minimum wage differ from workfare – by definition working for your benefits?
      This is very similar to the Future jobs Fund – which has since been shown to be highly effective and even beneficial to the country as a whole.

      • Agreed. The Future Jobs Fund worked very well – but on the whole it was a public and voluntary sector scheme. Private sector employers just don’t appear to be able to deliver and this is partially why the Tory pl,ans have been such a disaster

      • Monkey_Bach

        It depends on which way you look at it.

        Considered as a six month element in a three/four year programme, e.g., one year with the Jobcentre followed by two years on the Work Programme and then 30 hours a week for six months on the minimum wage in the third/forth year, it is a drop in the ocean. Number crunching the best possible scenario such a placement would pay based on today’s figures a participant could earn as much as 26 x 30 x £6.19 = £4,828.20 over the half year: subtracting six months Jobseeker’s Allowance (at the maximum rate) from this figure we see that participants would finish the scheme £4,828.20 – 26 x £71.00 = £2,982.20 better off than they would have been after suffering a similar period of unpaid work experience/workfare during year three of the scheme.

        I suppose if you’ve been continuously out of work for over two years a few thousand pounds would seem like a lot of money. But will people who have completed the scheme actually keep that full amount in toto? Being slightly cynical I can’t help but wonder whether Job Guarantee participants while earning sub-minimum wages might not see other benefits, e.g., housing benefit, recalculated and reduced forcing them to contribute more of their own meagre income to meet their rent and part-pay other charges. Governments give with one hand and take back with the other all the time.

        The Job Guarantee will have to be an incredibly comprehensive to cater for the needs of an army of diverse people from all backgrounds, of all ages, some completely unqualified, others with post-graduate degrees. I am encouraged to see signs of the Labour Party finally drifting back towards a more humane and compassionate stance, where the Party commits itself to trying to help unemployed citizens better themselves than working overtime to demonise, hound and punish unlucky citizens for circumstances beyond their control.

        Eventually, when more policy detail becomes available we will all be in a position to judge these matters better, but the fact that Liam Byrne’s name is attached to the policy fills me less with hope than with foreboding.


  • LordElpus

    So after 2.5 years in opposition badgering this government about their failure to create jobs the best the Labour brains can come up with is to pay employers to take on a long term doley. Sounds just like the last Labour government creating non-jobs in the public sector.

  • Pingback: Guaranteed jobs and enforced work (aka I WANT MY HOVERBOARD) « pixie359()

  • David B

    I note the hit is on private sector pensions. As always high earners in the civil service and in politics (such as ex cabinit ministers) will still get their full pensions without change

  • Dave Postles

    Single-board computers are a prospect for the future; the RPi is being assembled at the Sony plant in Wales. Apple has recommenced assembling computing equipment in the US. The factors are changing. It is becoming possible again to assemble IT equipment here. Every public sector organization should purchase equipment assembled in this country. These companies assembling the products could be subsidized to take on people to learn the practical, technical skills of assembling.
    There is potential for a massive deployment of OpenSource operating systems and software, with immense economies and value. The MS Windows tax could be obviated. People could be trained and employed to lead the transition to OpenSource applications software (like LibreOffice instead of MS Office).
    The Green economy will require new technical skills for its implementation and installation. Again, the technical skills of assemblage could constitute another area for skilling up unemployed people.


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