The long road from welfare to work

Will the government’s proposals to change the way training providers are paid really help solve the

In one of the upstairs rooms at the Rathbone training organisation's facilities in Oldham, Greater Manchester, Josh Duffy is leaning back on a chair that is too small and totting up the organisations that have tried to help him get a job. Rathbone is the sixth training provider with which Josh, who's just become a dad, has had contact since leaving school two years ago.

We count them up: first, there was North Lancs Training, where he studied construction. He left to go to Oldham College, where he was enrolled on a Level 1 bricklaying course. Then, after he decided that wasn't for him, a company called Work Solutions provided him with a mentor and some help writing a CV. "I didn't see them often. I didn't have much chance of getting a job. I was young and I had no experience," Josh explains.

After about six months without progress, he applied for plumbing. But that was with a private training provider and Josh couldn't afford the £2,500 fee. Next, he embarked on an "entry to employment" course with the YMCA. After eight weeks there, things seemed to be looking up. He had certificates in first aid, manual handling and safety, and the YMCA had moved him on to something called a "foundation modern apprenticeship" in retail, with a placement at an Ethel Austin clothing store. A couple of months down the line, he was told there wasn't any prospect of a job – the chain was cutting the hours of permanent staff and later went into administration.

So, Josh washed up at the door of Rathbone, which found him a work placement at a local store called B&M Bargains. Despite his ropey training history, the charity was prepared to give him a go, secure in the knowledge that it would be paid for its work. In future, it might have to think harder about doing this. The new Work and Pensions Secretary, Iain Duncan Smith, proposes that organisations delivering his welfare-to-work programme should be paid by results. That, according to Paul Fletcher, Rathbone's director of youth engagement, will leave them with tough decisions to make about whether to carry on doing what they do best – taking the most disaffected young people off the streets and setting them on their feet – or to focus on the easy-to-help and a healthy bank balance. There's nothing intrinsically wrong with payment by results, he tells me, it's just that it doesn't seem to have been adequately thought through.

“Principles are good, but the consequences for the financial balance sheet can be messy," Fletcher concedes. "The big question for organisations like ours is: do we start to be more selective and drive our performance in terms of who we are going to get paid for, or do we stick with our mission and risk not actually getting paid? The way a lot of providers will respond is by being selective at the front door. That means the most vulnerable and the most marginalised could end up going underground, losing their benefits and going into the black economy."

Revolving door

Duncan Smith's proposals are an extension of rules that began to be implemented under the last government. Under Labour's Flexible New Deal, providers were paid 20 per cent of their fee – typically about £1,400 in total – upfront, 30 per cent when clients had found a job and stuck at it for three months, and the rest after they'd been working six months. Now, it's likely that the full payment will not come in until they have stuck with a job for a year.

In some ways, what is happening is a fundamental shift in the way we deal with the young unemployed. Previously, the critical target of government programmes was to get people off the books of organisations such as Jobcentre Plus, so the end result was less important.

Julie Bird, the Rathbone tutor who brought Josh to the centre, sums up the old approach: "Everybody has targets to meet and as long as [the clients] are in some kind of training, it makes the statistics look good." The problem with this, she explains, is that these programmes become an end in themselves. Lots of people, like Josh, end up in a kind of revolving door, spat out by one provider, then sucked in by another. "There's quite a few in that situation," Bird says. "There's not always a guaranteed job at the end of it. Once the young person's off that book, there's no follow-up."

So well recognised is this phenomenon that there's even a word for it in the trade – "churn". There is no requirement for training organisations to monitor how many times their recruits have been around the course before, so there are no statistics to back up the sense that these short-term fixes haven't been working. Yet a major study on disengaged youth published in 2008 by the Nuffield Foundation and Rathbone estimated that four out of ten young people who were out of work were caught in a repeating cycle of short-term courses, casual employment and joblessness.

Rebuilding walls

Duncan Smith's payment-by-results plan is designed to deal with this. The question for the new government will be whether, by such a simple expedient as not paying the providers of back-to-work schemes until they deliver long-term results, it can reverse decades of labour-market casualisation and even the age-old tendency of the young to drift from one job, or one course, to another.

With youth unemployment hovering at the one million mark, and reports that there will be 70 applications for every graduate job this year, the issue looks unlikely to go away in the near future.

Fletcher has a different solution, which is gaining currency among many of those who work with the young unemployed. We should, he says, return to the glory days of Margaret Thatcher's Youth Training Scheme (YTS). One of Fletcher's first jobs was running such a scheme. "We rebuilt people's garden walls with old tradesmen passing on their skills, so there was job satisfaction and understanding," he says. "The key thing is, it's got to be perceived as real. At the time, I thought it was just OK, but with hindsight it was a good scheme."

YTS, he points out, was a 12-month placement – later extended to two years – with a non-means-tested allowance of around £30 a week – the same as today's education maintenance allowance, and in real terms about three times as high. Most of the participants progressed into real jobs.

Josh, after many false starts, has almost managed to do the same. He's just been told B&M Bargains is prepared to take him on as an apprentice. He talks with enthusiasm about his workplace, where he has been getting a £30 allowance for a 30-hour week since last November. "I'm looking after the furniture department. I build displays and do merchandising. It's great – I like hands-on work," he explains. As an apprentice, he'll still be on a low wage: "It's rubbish, but it's got to be done," he says, cheerfully. For him, finally, there should be a happy ending. It is much less clear how the legions of similarly unlucky or confused young people will fare under the new system.

The lost generation

Unemployment rose from 1.3 million to more than 3.4 million during Margaret Thatcher's premiership. Families were hardest hit in Northern Ireland, where unemployment reached 20 per cent, and in Scotland and the north-east, where the jobless rate was roughly 15 per cent.

In response to the persistently high rates of youth unemployment, Thatcher founded the Youth Training Scheme, a programme offering on-the-job training to 16- and 17-year-olds. The scheme was praised by some as an effective replacement for apprenticeships, but others argued that it enabled employers to exploit school leavers as cheap labour.

Many historians view the rise in unemployment as a regrettable but necessary consequence of the Tories' economic policies. Others, however, contend that the Thatcher government deliberately raised unemployment in order to destroy trade union militancy. Sir Alan Budd, who recently resigned as head of the Office for Budget Responsibility, said in 1992: "Raising unemployment was an extremely desirable way of reducing the strength of the working classes, if you like . . . What was engineered there in Marxist terms was a crisis of capitalism, which recreated a reserve army of labour and has allowed the capitalists to make high profits ever since."

George Eaton

This article first appeared in the 26 July 2010 issue of the New Statesman, Wanted: leader of the Labour party

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The Catalan cauldron

The prospect of the break-up of Spain poses yet another challenge to Europe.

As Britain prepares to mark the centenary of the bloodiest battle in the First World War, the Somme, in July, Spain is bracing itself for an even more traumatic anniversary. In July 2016 it will be 80 years since the start of a civil war that tore the country apart and continues to divide it today. In the four decades since the return of democracy in the mid-1970s, Spaniards slowly inched towards rejecting the extreme violence of the Francoist right (and elements of the opposing left) as well as acceptance of various federal arrangements to accommodate the national sentiments of the Basques and Catalans, whose aspirations Franco had so brutally suppressed. In recent years, however, this consensus has been called fundamentally into question, with severe potential consequences not only for the unity of Spain, but the cohesion of the European Union.

On 27 October 2015, after the Catalan elections, the new parliament in Barcelona passed a declaration requesting the start of a formal secession process from Spain, to be in place in 18 months. The immediate reaction of Spain’s prime minister, Mariano Rajoy, was to announce that the state was entitled “to use any available judicial and political mechanism contained in the constitution and in the laws to defend the sovereignty of the Spanish people and of the general interest of Spain”. The preamble to the constitution proclaims the Spanish nation’s desire to “protect all Spaniards and the peoples of Spain in exercising their ­human rights, their cultures and traditions, languages and institutions”. Probably the most disputed articles are 2 and 8, which state, respectively, that “the constitution is based upon the indissoluble unity of the Spanish nation, common and indivisible patria of all Spaniards” and that “the army’s mission is to guarantee the sovereignty and independence of Spain, to defend its territorial integrity and the constitutional set-up”. Rajoy’s implication was clear: the unity of the country would be maintained, if necessary by military means.

It was Madrid, however, that broke with the federal consensus some years ago and thus boosted secessionist sentiment in Catalonia. José María Aznar’s government (1996-2004) failed to respond to demands for greater autonomy for Catalonia, at a time when secession was not even mentioned. This led to an increasing awareness among Catalans that the federal transfer system within Spain left them with an annual deficit of 8 per cent of Catalonia’s GDP because of the financial arrangements established by the Spanish state, an issue aggravated by the effect of the global financial crisis. Catalan nationalism thus became a matter of not only the heart, but also the pocket. Even more important was the Spanish legal challenge to the Statute of Autonomy of Catalonia 2006 and its subsequent dilution, after it had been sanctioned by the Catalan parliament, and by both the Spanish congress of deputies and the senate, not to mention the Catalan people in a legally binding referendum.

According to the Spanish high court of justice, some of the statute’s content did not comply with the Spanish constitution. This outraged many Catalans, who could not understand how the newly approved statute – after following all the procedures and modifications requested by Spain’s political institutions and constitution – could still be challenged. Four years later, the Spanish high court finally delivered its verdict on 28 June 2010. It removed vital points from the Statute of Autonomy 2006 and declared them non-constitutional. All this led to a revival of Catalan nationalism, culminating in a symbolic, non-binding referendum in November 2014, which was boycotted by opponents and produced a majority of 80 per cent in favour of independence.

The roots of this antagonism go deep, to the civil war that broke out on 17-18 July 1936 when some sectors of the army rebelled against the legitimate government of the Second Republic. The rebels rejected democracy, the party system, separation between church and state, and the autonomy of Catalonia, the Basque Country and Galicia. Their primary objective was to re-establish “order” by eliminating all vestiges of communism and anarchism, then quite strong in some parts of Spain.

High on the list of General Franco’s targets was Catalan nationalism, which had been growing since the late 19th century. The industrialisation of Catalonia and the Basque Country left the most economically developed parts of the Spanish state politically subject to the less prosperous Castile. By the end of the 19th century and influenced by German Romanticism, la Renaixença – a movement for national and cultural renaissance – prompted demands for Catalan autonomy, first in the form of regionalism
and later in demands for a federal state.

Catalan nationalism did not emerge as a unified phenomenon. Diverse political ideologies and cultural influences gave rise to various types of nationalism, from the conservative nationalism of Jaime Balmes to the federalism of Francesc Pi i Margall, to the Catholic nationalism of Bishop Torres i Bages and the Catalan Marxism of Andreu Nin, among others. Catalonia enjoyed some autonomy under the administrative government of the Mancomunitat or “commonwealth” from 1913 onwards. This was halted by the 1923 coup d’état of the dictator Miguel Primo de Rivera. Autonomy was granted again during the Second Spanish Republic from 1931-39 – but abolished by Francisco Franco’s decree of 5 April 1938.

Franco’s victory led to the suppression of Catalan political institutions, the banning of the Catalan language and proscription of all the symbolic elements of Catalan identity, from the national flag (the Senyera) to the national anthem (“Els Segadors”). In February 1939, the institutions of the autonomous Generalitat went into exile in France. In 1940 the Gestapo arrested the president of the Generalitat, Lluís Companys, and handed him over to Spanish officials. He was interrogated and tortured in Madrid, then sent to Barcelona, where he was court-martialled and executed at Montjuïc Castle on 15 October 1940. The most important representatives of the democratic parties banned by the regime went into exile, or were imprisoned or executed. The authoritarian state designed by Franco crushed dissent and used brute power to suppress the historical nations included within its territory. The regime’s aim was to annihilate the Catalans and the Basques as nations.

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After almost 40 years of Franco’s dictatorship, Catalonia recovered its government, the Generalitat, in 1977 – before the drafting of the Spanish constitution in 1978 – and sanctioned a new statute of autonomy in 1979. The 2006 statute was expected, at the time, to update and expand Catalans’ aspiration for further devolution within Spain: never secession.

At present, a renewed nostalgia and enthusiasm for Francoism can be found among some sections of the Spanish right. One of the main challenges of the newly democratic government from the mid-1970s onwards was to get rid of the symbols of Francoism that had divided Spaniards between “winners” and “losers” in the civil war. It was only in 2007 that the then prime minister, José Luis Rodríguez Zapatero, guided the Law of Historic Memory through parliament with the aim of removing hundreds of Fascist symbols reminiscent of the Franco era from public buildings. It also sought to make reparations to victims of the civil war and the ensuing dictatorship.

There still exist hundreds of other references to the Fascist regime, however, with streets, colleges and roads named after Franco and his generals. The most controversial of these is the Valle de los Caídos (“Valley of the Fallen”), near Madrid, commissioned by Franco as his final resting place. It supposedly honours the civil war dead, but is primarily a monument to the general and his regime, housing the graves of Franco and José Antonio Primo de Rivera, the founder of the fascist Falange political party. Roughly 450,000 people visit it every year, and while most of them are foreign tourists, groups of Falangists and supporters of the old regime who come to pay tribute to the dictator have frequented it. Nostalgics for Francoism, though still a small minority within modern Spain, are becoming vociferous. They find common ground with far-right-wing conservatism, particularly in their shared aversion to federalism.

On 3 August last year Artur Mas, the then president of Catalonia, called an extraordinary parliamentary election after all attempts to negotiate and agree on a legally binding referendum with the Spanish government failed. Supporters of independence immediately announced that the forthcoming Catalan elections would be regarded as a plebiscite on independence.

On a turnout of more than three-quarters of the electorate, supporters of outright independence gained 48 per cent of the vote, while those backing a unitary state secured 39 per cent. On 9 November 2015 the Catalan parliament formally declared the start of the process leading to building an independent Catalan state in the form of a republic. It also proclaimed the beginning of a participative, open, integrating and active citizens’ constituent process to lay the foundations for a future Catalan constitution. The Catalan government vowed to move forward with its secession process. Immediately, the Spanish Constitutional Court suspended the Catalan law setting out a path to independence and warned that defiance could lead to criminal charges.

Worse still for Madrid, secessionism is gaining strength not only in Catalonia but also in the Basque Country, whose premier, Iñigo Urkullu, demands a “legal consultation” on the northern region’s future in Spain. He supports a new statute for the Basque Country and defends its status as a nation in the EU. Similarly to Catalonia, the Basque Country has a distinct language and culture, and benefits from the so-called concierto económico, an advantageous financial deal with the Spanish state.

***

The Spanish government’s refusal to engage constructively with Catalan nationalism contrasts markedly with London’s more relaxed and ultimately more successful response to Scottish nationalist aspirations. The “Edinburgh Agreement” between the British Prime Minister and the then first minister of Scotland to allow a binding referendum on Scottish independence stands in sharp contrast to the Spanish government’s outright opposition to a similar vote in Catalonia. Basques and Catalans find deaf ears regarding further devolution and binding referendums on self-determination. This highlights the distance between various conceptions of democracy that coexist inside the European Union, rooted in the diverse political cultures of nations with varying historical backgrounds.

All this matters, not only to Spain but to the EU, because it is part of a broad trend across the continent. In mainland Europe, demands for self-determination are running strong in Flanders as well as parts of Spain. In turn, tensions between Italy and Austria over control of South Tyrol (Trentino Alto Adige, to the Italians) remain high, as do demands advanced by the South Tyrol­ean secessionist movement. Bavarian regionalism is critical of the present German (and European) political order. Further to that, modern Venetian nationalism and its long-standing demands for independence have prompted a renewal of Venetian as a language taught in schools and spoken by almost four million people.

Matters are now coming to a head. Catalonia and Spain are in flux following two inconclusive elections. In January, after a prolonged stand-off, the sitting Catalan president, Artur Mas, made way for a fellow nationalist, Carles Puigdemont. He was the first to take the oath of office without making the traditional oath of loyalty to the Spanish constitution and the king. Felipe VI, in turn, did not congratulate Puigdemont.

The new president has announced that he plans to draw up a constitution, to be voted on in a referendum “to constitute the Catalan Republic” at the end of an 18-month consultation process. Puigdemont’s strategy envisages not a dramatic unilateral declaration
of independence, but a more gradual process of disconnection in constant dialogue with the Spanish government and Catalan political parties. Let no one be deceived by this “softly-softly” approach: it is designed to culminate, in a year and a half, perhaps sooner, in a vote on establishing a separate, sovereign state of Catalonia.

Meanwhile, Spanish politics are in flux. The elections to the Cortes on 20 December 2015 resulted in a victory for Conservatism, but also the most fragmented Spanish parliament ever and, as yet, no government. Almost the only thing the Spanish parties can agree on is opposition to Catalan independence, yet even here there are divisions over whether more autonomy should be granted and what response to make to unilateral moves by the Catalans.

The stakes are high for both sides. By pressing too hard, too early, Catalan nationalists may provoke Madrid. This would be a mistake. Strategy is important and recent events in Catalonia will weaken the Catalans’ democratic, peaceful and legitimate desire to hold a referendum on independence. Likewise, a heavy-handed response from Madrid will not only destroy the residual bonds between centre and periphery in Spain, but put the central government in the dock internationally. A confrontation will also cut across the only possible solution to this and all other national conflicts within the eurozone, which is full continental political union. Full union would render the separation of Catalonia from Spain as irrelevant to the functioning of the EU, and the inhabitants of both areas, as the separation of West Virginia from Virginia proper in the United States today.

In a nightmare scenario, radicalisation and unrest could emerge in Catalonia, with division between Catalans and memories of the Spanish Civil War coming to the fore. In this context, it might become very difficult to prevent violence.

This is the last thing that Brussels wants to hear as it grapples with the euro crisis, Russian territorial revisionism, Islamist terror, the migrant question and the prospect of Brexit. A meltdown in Catalonia will create dilemmas for Europe, starting from problems with Schengen, and raise questions about continued membership of the EU. It will also work against Catalans’ expectations of receiving EU support in their quest for independence, as turmoil in Europe will prompt nation states to close ranks. The EU will not be expected to intervene, because this scenario would – at least initially – be defined as an “internal affair of Spain”. Conflict between Barcelona and Madrid would shatter one of Europe’s biggest member states.

In that event, the peninsula will become the hottest point in an emerging “arc of crisis” across the southern flank of the EU, stretching from Portugal across Spain, an Italy struggling along with everything else to cope with the flow of migrants, the troubled Balkans, to Greece, which is perpetually perturbed. This highlights yet another flaw in the EU. It has no institutional framework for dealing with Catalan demands to become a nation within the Union, or those of other populations. Merely insisting on Spanish state sovereignty will not make the problem go away for Brussels, or for Europe as a whole. This is a potential matter of life and death not only for Spaniards and Catalans, but perhaps for the EU itself.

Brendan Simms is the director of the Forum on Geopolitics at the University of Cambridge and president of the Project for Democratic Union Montserrat Guibernau is a visiting scholar in the Department of Politics and International Studies at Cambridge and a member of the Forum on Geopolitics

This article first appeared in the 21 April 2016 issue of the New Statesman, Shakespeare 400 years Iater