Unemployment

Oral Answers to Questions — Social Security – in the House of Commons at 12:00 am on 2nd November 1992.

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Photo of John McFall John McFall , Dumbarton 12:00 am, 2nd November 1992

To ask the Secretary of State for Social Security what assessment he has made of the increase of costs for his Department which arises from an increase in unemployment of 100,000.

Photo of Alistair Burt Alistair Burt Parliamentary Under-Secretary (Department of Social Security)

My Department's second annual report shows the costs of an increase in unemployment of 100,000 to be £330 million.

Photo of John McFall John McFall , Dumbarton

Given that £330 million, given that with 2·7 million people on the dole, the cost will amount to £8 billion next year and given the debilitating cost to the economy in lost taxes and national insurance, would it not make better sense to keep people off the dole so that there was economic recovery and a boost to the public purse? When will a shaft of sanity penetrate the Government's bodged actions and muddled thinking?

Photo of Alistair Burt Alistair Burt Parliamentary Under-Secretary (Department of Social Security)

I am sure that the hon. Gentleman is aware that about 50 per cent. of people who become unemployed are taken off the register after three months and about 65 per cent. of those remaining are taken off after six months. The Employment Service has made a considerable effort to ensure that people come off benefit as quickly as possible to get back to work. The hon. Gentleman must also be aware that this country's employment problems are shared by many other countries on the continent and from Australia to America. One of the Opposition's biggest mistakes is to ignore world trade.

Photo of David Willetts David Willetts , Havant

Does my hon. Friend accept that the Government's proposals for one-stop shopping represent an important improvement in the potential service to the unemployed, who will no longer be caught in an administrative muddle between unemployment benefit and social security offices?

Photo of Alistair Burt Alistair Burt Parliamentary Under-Secretary (Department of Social Security)

My hon. Friend is right. The Department is putting considerable efforts into finding the best ways possible to ensure that those who are caught up in unemployment have the best opportunities to seek advice and have to go through fewer administrative hurdles to claim that to which they are entitled.

Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe

Is the hon. Gentleman aware of the Prince of Wales's humane initiative to help the unemployed and others in dire need by distributing free food parcels in Manchester and other regional centres across the country? Is not the Prince's action a stark reminder that benefits for the unemployed, as for all poor people, must be protected in real terms at this evening's special meeting of the Cabinet about public expenditure?

Photo of Alistair Burt Alistair Burt Parliamentary Under-Secretary (Department of Social Security)

The right hon. Gentleman is too wily in these matters not to know that I cannot possibly discuss public expenditure questions at this stage. The degree of concern that he expressed about the unemployed is shared by those on the Conservative Benches. He will know that the best help given to the unemployed is not benefits but efforts to get those people back into work. All the efforts of the Government and those of my colleagues who are involved in economic regeneration are designed to ensure that interest rates stay low, inflation comes down and the country has the best prospects for recovery and a return to proper jobs.

Photo of Michael Fabricant Michael Fabricant , Staffordshire Mid

Will my hon. Friend acknowledge that, sad though it is that unemployment has gone up, Britain has the lowest proportion of unemployed anywhere in the European Community, apart from Denmark, and that 2 million more people are employed than in 1983?

Photo of Alistair Burt Alistair Burt Parliamentary Under-Secretary (Department of Social Security)

My hon. Friend is right. There is a higher proportion of people in work in this country than in any other European country, other than Denmark, but that statistic is often missed. There is no doubt that the trade recession which has swept through Europe and the rest of the world has affected us as well. To ignore that problem and to see this country as totally isolated from that difficulty is unrealistic, but unrealism seems to be a permanent characteristic of the Opposition.