Q&A: What will 'Help to Work' mean for claimants?
- 28 April 2014
- From the section Business
The plan to help those out of work for more than two years was announced by George Osborne, the Chancellor, in September 2013, and took effect on 28 April 2014.
Mr Osborne said that people out of work for more than two years "were not going to be able to do nothing" for their benefits.
He also said he was not going to "leave the long-term unemployed behind".
But how will Help to Work be different from what happens at the moment?
Who will be affected by Help to Work?
It will affect anyone who has been on the government's existing Work Programme, but who still has not found a job after two years. To qualify for the Work Programme, claimants have to have been claiming Jobseeker's Allowance (JSA) for at least three months.
People over 25 years old need to have been claiming JSA for a year. It is thought that around 200,000 people could qualify for Help to Work.
What choice will claimants have?
To continue claiming JSA, claimants will have three options. To accept a community work placement, such as making meals for the elderly; to visit a Job Centre every day; or to take part in further training. The government calls this "intensive jobcentre support". Anyone who refuses will face losing a month's worth of benefits. If they refuse again, they could lose three months of benefits.
How is this different to what happened previously?
Before April 2014, if someone had not found work after two years on the Work Programme, they went back to the Job Centre. They were offered support with their development needs, and weekly meetings with Job Centre advisers, but there were no compulsory programmes. They were free to continue claiming JSA.
Does the introduction of a new scheme mean the Work Programme is not working?
The government says the programme has made a big difference since it was introduced in June 2011. It says nearly a quarter of its early participants have found at least three months of work. Recent figures showed that roughly 15% of those on the Work Programme have found themselves in work for at least six months.
However, the Work Programme has been criticised by both Labour and the TUC for what they say is a poor success rate. As few as 10% of those claiming Employment and Support Allowance (ESA) have managed to find work under the programme.
What would Labour do?
Labour has said it will guarantee anyone under the age of 25 a part-time job after a year of being out of work. Anyone over 25 would be offered a job after two years of being unemployed. Those affected would be given the national minimum wage to work for 25 hours a week.
Employers would receive a government subsidy to hire people. Labour says the cost of its Jobs Guarantee would be £1bn, and it would be funded by restricting tax relief on pension contributions to the basic rate.
What do other countries do?
One of the countries which has managed to cut the number of young long-term unemployed is Denmark. Anyone who is out of work for 12 months (or six months for under 25s) gets special support in the form of help with job searching, vocational training and education.
Denmark spends 1.3% of GDP on this Active Labour Market Policy. According to a report for the Work Foundation, published in January 2013, the UK spends 0.3% of GDP on similar measures.