Social Security (Basic Skills Training Pilot) Regulations 2004

– in the House of Lords at 1:30 pm on 18th March 2004.

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Photo of Baroness Hollis of Heigham Baroness Hollis of Heigham Parliamentary Under-Secretary, Department for Work and Pensions, Parliamentary Under-Secretary (Department for Work and Pensions)

My Lords, these draft regulations are intended to support the Government's Skills for Life strategy for improving adult basic skills, which my right honourable friend the Prime Minister launched in March 2001. For too long, the scandal of adults not being able to read, write and use maths has gone unchecked. Up to 7 million people in England alone are reported to have poor basic skills and the Government are determined to address that. Improving the basic skills of 1.5 million adults by 2007 is one of our leading priorities.

Without a functional level of basic skills, people's chances of finding work are reduced. When they do obtain work, they are likely to be in low-skilled, low-paid jobs with few prospects and they are more likely to endure repeated periods of unemployment. Such adults do not have the ability to read, write or speak in English or to use mathematics at a level necessary to function at work and in society in general. The costs of unemployment for the individual are high. So are the social and economic consequences for us all. Given that about a third of people with illiteracy and innumeracy problems are parents, the issues for their children are also severe. The best way of guaranteeing that a young boy becomes functionally illiterate is to have a functionally illiterate father. Wasting the potential skills of the workforce brings significant losses in productivity, as well as higher benefit costs.

We believe that the key to improving the prospects of those people is to raise their skill levels so that they can find and keep work. Since the strategy was introduced, all jobseekers have been screened at Jobcentres for basic skills by the time they reach 26 weeks of unemployment. On previous occasions I described such screening, that involves jobseekers being asked to discuss a basic advertisement for an assistant caretaker, the hours and the pay, and to see whether people understand it and can work out how much they would earn if they worked three hours of overtime, and so on. After screening, those who are unable to comprehend or read the advertisement and are identified with possible basic skills needs are referred to specialist organisations under contract to Jobcentre Plus for an independent assessment. That professional assessment determines more clearly the individual's needs and where his current level of ability lies; it will also help to identify the most appropriate course for each individual.

Despite the considerable support that is available in the form of training and financial resources, significant numbers still refuse to take advantage of it. All of us will know of people who have spent 10, 15 or 20 years concealing their illiteracy, rather than—I am afraid—addressing it. From April this year, Jobcentre Plus is to introduce a number of measures designed to improve take-up of the help that is on offer and reduce attrition between the various stages of the screening, assessment and training process. The measures include a screening tool to help advisers to better identify people with basic skills needs and the payment of financial incentives. Jobseekers taking up basic skills training will receive an additional £10 per week on top of their existing benefit entitlement and a bonus of £100 for achieving a qualification that counts towards the Government's PSA target.

Alongside those incentives we propose to introduce a pilot in a number of locations across England to measure the impact of a voluntary approach against a mandatory regime. Subject to your Lordships' agreement, these regulations would enable the Government to establish a scheme imposing sanctions on people claiming jobseeker's allowance if, without good cause—I emphasise, "without good cause"—they refused or failed to take part in basic skills training. The pilot would involve jobseekers aged from 18 and 59 who had been claiming benefit for at least six months and had been assessed as needing basic skills training—in other words, unable fully to comprehend the advert for an assistant caretaker at the mythical Bowater House. Those people who refused to participate would incur a sanction involving the loss of JSA for two weeks in the first instance. The sanction for a further failure to participate within 12 months would be four weeks' loss of JSA.

We recognise that Jobcentre Plus needs to operate the pilots in a sensitive way that respects the complex problems of the disadvantaged and vulnerable. I entirely accept that someone with deep-rooted functional illiteracy may well be multiply disadvantaged and have many other problems as well as the presenting problem of illiteracy. We accept that there will also be jobseekers for whom basic skills training would be inappropriate. They may currently have mental health problems or learning difficulties and we hope to pick those up on screening, once the people have been referred for professional assessment.

We have an important safeguard in the draft regulations that are now before your Lordships' House. If a jobseeker begins a basic skills course and it becomes apparent that the course is not suitable—perhaps because the jobseeker's disabilities are such that he is not benefiting from the course—it will be possible to exercise discretion and stop attendance on that course. But, I remind your Lordships that, normally, if a jobseeker was unable to attend a course because of a disability, JSA might have been the wrong benefit in the first place and this scheme might help put that person on a more appropriate benefit.

There will be other safeguards. Jobseekers may have good cause for failing to attend appropriate training—perhaps because of illness, domestic emergency or caring responsibilities within the family. Jobseekers will have the opportunity to explain their actions before any sanction decision is taken. The decision will be taken by an impartial decision maker and benefit will continue to be paid in full in the mean time. If a decision maker decides that a sanction is justified, the jobseeker will have the usual right of appeal to an independent social security appeal tribunal.

Hardship payments will also be available as a safety net. Jobseekers can claim payments of JSA at a reduced rate if they can show that they, or a family member, would otherwise suffer hardship. This will provide immediate protection for vulnerable groups. For example, a couple with three dependent children, who would normally receive some £217 in benefit, would receive—after sanction, if someone was unwise enough not to pursue the course—a hardship payment of £195. So £217 is the full sum and £195 is the sanctioned sum. If a family member were pregnant or seriously ill, the payment due would be £206.

We will, of course, evaluate the outcome of the pilot. We are committed to ensuring that evaluation results will be statistically valid and provide robust evidence of whether or not sanctions, or the threat of sanctions, for non-attendance at basic skills training has a statistically significant effect on the number of qualifications gained and people completing their courses. Analysts have chosen a sample twice the size of that strictly needed to ensure that we have sufficient numbers. I hope the result will be that we find out whether sanctions ensure that those people who most need help do not choose to walk away from that help.

Therefore, I am satisfied that the regulations are compatible with the European Convention on Human Rights, and I commend them to the House.

Moved, that the draft regulations laid before the House on 12 February be approved [10th Report from the Joint Committee].—(Baroness Hollis of Heigham.)

Photo of Lord Higgins Lord Higgins Conservative

My Lords, the House will be grateful to the noble Minister for that explanation of the regulations. The issue is the way in which sanctions will be used to encourage—if that is the correct word—people to undertake skills training. The situation that she described, with 7 million people suffering through lack of numeracy or literacy skills, is horrifying. Therefore, it is not surprising that a much higher percentage than the national average should be among those people who are seeking to find—or rather not seeking to find—jobs, but are, anyway, unemployed at present. I am also grateful to the Minister for giving some indication of the strength of the sanction: the difference between what those people would normally receive and what they would receive under sanction, thus relying purely on hardship payments.

The three original pilots were designed to explore different approaches to identifying and improving skills. On one hand, there was a suggestion that there would be financial incentives; on the other hand, there would be sanctions; and, in a third case, both would be combined to encourage people to undergo skills courses. I shall leave on one side the basic question of whether sanctions and withdrawal of benefit are appropriate, because we have previously discussed that. However, what I found surprising in the Minister's remarks was that she did not point out that the Government have decided that the previous pilots were inconclusive, primarily because the number of clients at the end of the evaluation period was not enough to draw any robust conclusions.

That raises the question: who on earth designed the original pilot scheme; and, if it was consultants, have they subsequently been fired? Clearly, much wasted time, effort and money was involved in the pilots, which produced no meaningful results. As a result of that failure, the Government now find that they need to introduce this proposal. However, the proposal concerns only sanctions and does not deal with either financial incentives or, indeed, a combination of sanctions and financial incentives.

The other matter that surprised me very much was that the noble Baroness did not mention what the Government's own advisory committee on these matters—the Social Security Advisory Committee—felt about this whole issue. The committee expressed significant concerns about the proposed approach. Its view was that available research does not support the conclusion that the use of sanctions can improve training outcomes. The people on that committee are expert in this field and, if I understand it correctly, they effectively came down against these regulations and further expenditure on this kind of operation. The committee believed that much of the time was spent on dealing not with training but, rather, with personal problems and other issues. The committee expressed particular views with regard to the problems of those whose first language is not English.

In that context, perhaps I may ask the noble Baroness a question, given the general dispute about immigration and about people coming here to work. That dispute has been taking place in a wider context elsewhere in the European Union and, in particular, in the new accession states. When people arrive in this country in order to work, are they given tests to see whether they are in a position to do so? Obviously, it would be undesirable for them to say that they were coming here to work if the view of the department carrying out the tests was that they would have difficulty in doing so.

Photo of Baroness Hollis of Heigham Baroness Hollis of Heigham Parliamentary Under-Secretary, Department for Work and Pensions, Parliamentary Under-Secretary (Department for Work and Pensions)

My Lords, is the noble Lord referring to people under the current accession arrangements or to people in the new A8 countries who may be coming here after May, or is he speaking more generally?

Photo of Lord Higgins Lord Higgins Conservative

My Lords, I am making a more general point. I do not want to press the issue but I believe that the Government should have a view about whether one is simply adding to the number of people who are in such a situation when an earlier check would establish the nature of the problem.

At all events, if I understand it correctly, the committee firmly takes the view that no gain is to be had in carrying out further pilots and that those pilots would not represent value for money. No doubt that is a matter which the National Audit Office could look into on another occasion.

We are up against time somewhat because we have a number of other orders to consider, but perhaps I may pose some specific questions to the noble Baroness. First, will she explain why she believes that the pilots give value for money, whereas the experts apparently do not? Secondly, what is the total budget for the pilot programmes and does that include the cost of administering and evaluating the sanctions regime? Thirdly, if the initial pilots did not provide sufficient information, which, after all, is the object of a pilot, why are the Government satisfied that this new set of pilots will be any better? I believe that we should know in advance how the pilots will be evaluated and what measures will be determined to appraise their success or failure. I have a number of other questions but perhaps I may pursue those on another occasion. However, these are the main ones that arise on these regulations at this stage.

Photo of Baroness Barker Baroness Barker Social Services, Non-Departmental & Cross-Departmental Responsibilities 1:45 pm, 18th March 2004

My Lords, I, too, thank the Minister for her explanation of the order. As I am taking the place of my noble friend Lord Russell, it will not surprise her to know that I wish to ask questions about sanctions. I concur with the noble Lord, Lord Higgins, that it is rather strange that the Government have decided, on the basis of the previous three pilots, to pursue only one—the most draconian.

I, too, consider it remarkable that the Social Security Advisory Committee, which produced a very forceful report, has been ignored. It is worth pointing out to the House that in its report the committee said:

"It is not possible to draw from the research conclusions that the use of sanctions can improve training outcomes, and we question the assumption that extending testing will prove whether the threat of sanctions does indeed have an important effect on the qualifications achieved and other employment outcomes".

I believe it is also worth noting the comments in the report about tutors who were involved in the pilots:

"Tutors who are working to engage disaffected and alienated people, and assist them towards employability, have told us that they believe that a sanctions driven regime would be wholly inappropriate for the sorts of courses they are running".

I question why the committee's advice was ignored. Can the Minister say whether an estimate has been made of the number of people who are likely to incur sanctions? Like the noble Lord, Lord Higgins, I should like to know the cost of the sanctions regime.

I should also like to know how the results of the pilot will be reported to Parliament. It seems that a number of pilots are being carried out in the Department for Work and Pensions—a department which, we understand from yesterday's Budget Statement, is shortly to be reduced in strength. I am rather intrigued about that.

The evidence on sanctions is, at best, mixed and somewhat inconclusive. I ask the Minister why, in setting up the further pilots, no work is being done to establish whether the imposition of sanctions leads people into behaviours which are dangerous but which they feel forced into because their benefit money has been reduced.

The noble Baroness spoke about families, and I noted the figures that she gave on those with sanctions. However, I believe it is important to note that in the kind of households to which we are referring—one-third of them with children—it is undoubtedly the case that any sanction of that kind will have a knock-on effect on children. Given that eradication of child poverty is one of the Government's main objectives, it seems rather strange to introduce something here which will have an adverse effect on that.

Finally, I understand from the report that one reason that the previous pilots were ineffective was that they were simply not long enough—they lasted for six months. These pilots are due to last for 12 months. Can the Minister say how she believes that that can conceivably be long enough to train people who clearly have a number of difficulties, which she acknowledged and set out for us, to find employers who are willing to give jobs to people with difficulties, and then to evaluate whether those jobs are sustained? Achieving all that in 12 months seems to me to be almost impossible, if not a tall order. I wonder whether, in 12 months' time, we shall find ourselves looking at yet another pilot. I should be very grateful if the Minister could answer those questions.

Photo of Baroness Hollis of Heigham Baroness Hollis of Heigham Parliamentary Under-Secretary, Department for Work and Pensions, Parliamentary Under-Secretary (Department for Work and Pensions)

My Lords, I shall do my best. Given that we all accept that we have a great deal of business to cover, I may have to send a round-robin letter after the debate in order to pick up the questions that I am unable to address due to lack of time.

I shall run together the comments made by the noble Lord, Lord Higgins, and the noble Baroness, Lady Barker, because many of their concerns overlap. The previous pilots were inconclusive; they did not run for long enough; and the numbers were too small. Of course, they were not the responsibility of my current department because, at that time, they came under what was then the Department for Education and Employment. They became the responsibility of my department when the employment part of that department joined the old Department of Social Security and became the Department for Work and Pensions. Therefore, noble Lords will understand if I am not as familiar with the original pilots.

However, I accept that no clear findings were established from the pilots. One can argue from that that one should abandon pilots or that one should try to carry them out in a more sustained manner with greater numbers. But they are pilots and, if they do not have the effect that we expect, obviously that is something from which we shall learn.

I shall return to sanctions and the Social Security Advisory Committee in a moment. The noble Lord, Lord Higgins, asked about people coming to this country and whether they are screened. From May, under the new accession arrangements, people will come to a job only when they have a work permit; therefore, they will not come to my department at all because they will not be entitled to benefit and so we would not pick them up.

The more general point is interesting. The noble Lord is right that something like 13 per cent of the original sample were people who had problems with spoken English and, for 18 per cent of the original sample who had basic skills problems, English was not their first language. The noble Lord was right to identify that, but they were the ones mostly likely to want to take voluntary courses because they were keen to acquire work and to come into mainstream society.

Photo of Lord Higgins Lord Higgins Conservative

My Lords, in regard to the group of people whom the noble Baroness has just mentioned, and taking the matter overall, how will the Government ensure that those who are told that they will have sanctions applied to them are able to read the warnings that are given to them, presumably in writing or in a different language?

Photo of Baroness Hollis of Heigham Baroness Hollis of Heigham Parliamentary Under-Secretary, Department for Work and Pensions, Parliamentary Under-Secretary (Department for Work and Pensions)

My Lords, we are talking about jobseekers—not people on income support or pensioners. Jobseekers have to sign on fortnightly. If they have enough English or competencies to get to the Jobcentre office, they will see someone there who will screen them at a certain point when they talk about their jobs in their interviews with their personal advisers. There is already outreach to people in an appropriate established procedure. I accept that there could be a problem with someone who has mental health difficulties, but in the normal course of events, when someone comes in to sign on—as they have to do in person at least once a fortnight or more often—he would be reached, so to speak, by the interview and the personal advice system.

On value for money, the total budget is £1 million, but I would not wish to judge that necessarily by saying how many jobs we shall achieve for such people with poor skills or improved skills as a result of the course. If one thinks of the rungs of a ladder as representing people's distance from the labour market, those who are one or two rungs away from going into work may be lone parents whose basic problem is childcare, which may be easy to overcome, but someone who has either deep-seated mental health issues or deep-seated illiteracy issues which they have been concealing may be many rungs away. Alongside the problems of literacy and numeracy they may have problems with self-confidence, social skills, communication skills and the like as well as lingering health problems.

It will be a slow job, but I believe most profoundly that if we do not do this, such people will remain consigned to the shadows of unemployment and of financial and social exclusion. They will not be able to read the name on the bus which says where it is going, they will not be able to take a child to a swimming pool as they cannot read the safety instructions, and they will not be able to choose the least expensive but, none the less, most nutritious food in a supermarket. One would be allowing them to live a life that would be incomplete, and I worry about the implications for their children.

The noble Baroness, Lady Barker, spoke of child poverty. I take the point that sanctions will affect people, but the way to overcome them is to do what one is required to do as part of the JSA. It is quite simple. If one does not want one's children to experience that poverty, one conforms to the JSA requirements. Having said that, the noble Baroness will know and will agree with me that the best way out of poverty for such a family is for the parents to enter the labour market and the biggest drag on them entering the labour market is their lack of basic skills.

At the moment, if a person is on JSA we can require him to undertake a higher level course as part of getting ready to go into the labour market, but we cannot require someone to do a basic level course, which would get rid of fundamental problems of illiteracy and innumeracy. I think that that is bizarre and no kindness to anyone.

We do not know that the number of people incurring sanctions will increase but we believe that it will. If it does not, the noble Baroness will be right, but we believe that it is preferable. At the end of the day, that is why we disagree with the Social Security Advisory Committee. Its advice is advisory; we respect its views on this matter, but they are not views that the Government share. Currently, we have a huge investment in voluntary programmes for illiteracy and so on; between April 2001 and July 2004 we have another 2 million or so learners taking up 4.5 million courses. We are trying to help about half a million people to reach basic levels, but there is a group of people who refuse to recognise or to accept that they need to address those issues. As a result, the one inheritance that their children, particularly boys, can be sure of receiving is their illiteracy.

I was asked who was to conduct the survey. It is a consortium of the British Market Research Bureau and the Policy Studies Institute. We expect them—I take on board the point made by the noble Baroness, Lady Barker—to report in 2006. Clearly, every sanction is a failure. We do not expect there to be many sanctions. Even under the previous pilots there were only 24 sanctions, so it might reach three figures, but I would hope not; we do not know and cannot tell. At the end of the day, someone who has illiteracy and innumeracy problems, and does not have the reading age of a seven year-old, cannot function competently in today's society. I believe that we need to use tough love—a cliched phrase. We need to get people, professionally screened and supported, on to training courses, where they are treated with dignity and sensitivity. I hope that such courses will address problems that they have refused to acknowledge, often for 10 or 20 years—such basic incompetencies as not being able to read the medicine labels on their children's bottles of medicine. With that explanation I hope that noble Lords will accept the regulations.

On Question, Motion agreed to.