The Tories' Help to Work will do nothing to solve the jobs crisis

Unlike Labour's Jobs Guarantee, Osborne's plan will mean people are still allowed to languish on the dole for years without ever having a proper job.

The Tories have not had a good week. Our energy freeze will save consumers £120 and businesses £1,800. Rather than welcome it, every time a Conservative appears in front of a television camera they have embarrassed themselves trying to defend the energy companies and a market that is letting Britain down. It's been toe-curling stuff. These Tories can't deal with the cost of living crisis, because when push comes to shove they only stand up for a privileged few.

Once again, David Cameron has shown how he's back in his comfort zone defending the few, not the working many.

Today, we have the Chancellor’s keynote speech replete with his second uncosted proposal in two days. Hot on the heels of a universally derided marriage tax allowance that won't help two-thirds of married couples (and which offers the rest just £3.85 a week, a drop in the ocean compared to the higher VAT and cuts to child tax credits and benefits which have left families worse off), today we have Help to Work - the latest Tory plan to deal with long-term unemployment.

George Osborne, we hear, has decided that Iain Duncan Smith, who is Work and Pension Secretary in name only, is "not clever enough" to do the job. You can understand why. Last week's Work Programme figures showed the scheme has now failed over a million people and even after two years in its good care, 80 per cent of people don't get a steady job. The Youth Contract is even worse, it's failing 90 per cent of people on it. Worse, the nation's auditor has slammed Universal Credit – the Tories’ only proposal to make work pay - and the programme is so out of control that personal assistants are signing purchase orders for tens of millions of pounds.

So Mr Osborne has stepped in with a policy that just hours later is already unravelling. Long term unemployment is at a record high - nearly a million people. And what will this scheme do for those people? Nothing. They won't be offered the scheme at all. In fact, just two per cent of job seekers - you heard that right - just two per cent - will be covered under the Tories' plan today.

My view is very simple. Labour is the party of work, and the party of the better off in work. We need to get the long-term unemployed off benefits and into work - full stop. Not just shoved around from scheme to scheme. Off benefits and into work, guaranteed. And that is exactly what Labour’s Compulsory Jobs Guarantee would do.

Under the next Labour government, if you are out of work for two years - one year if you are under 25 - we will insist you take a job paying the minimum wage, with job search and training alongside it.

Where would the money come from? Well, unlike the Tories, our scheme is fully costed. After just two days of their Conference, the Tories have made £1bn of unfunded spending commitments. Add in a week of the Lib Dems and ministers have so far made £1.6bn of spending commitments during the party conference season - without a clue how they would be paid for. In contrast, we'll reform the pension tax perks of the very rich and place a tax on bankers' bonuses to create our fund to get the long-term unemployed back into work.

We would work with employers like Fujitsu to make sure the jobs are there. In fact, all over Britain, Labour councils and the Welsh Assembly government are running this kind of programme for young people with huge success. The deal under Labour will be straightforward - we will make sure there are jobs, but if you're fit to work, you will have to take them. No ifs, no buts. So: under Labour, no-one will spend more than two years on the dole - no-one.

The Tories cannot - and will not - say this. Their scheme will mean people are still allowed to languish on the dole for years on end without ever having a proper job. And the fact that the Tories won’t tell you today is that this announcement is little more than reheating of a Labour scheme - ‘Work for your Benefits’ - which the Tories scrapped when they came into power. Since then, long-term unemployment has increased by nearly 400%. This is a crisis. That’s why only Labour’s jobs guarantee will do.

After three years of failure it is no surprise the government has finally felt the need to act. This government has utterly failed to tackle Britain’s jobs crisis - and now the social security bill is £20bn higher than forecast. We can't go on like this. We need more action to get the unemployed into jobs, more help for the hardworking people who have seen prices fall faster than wages for the last three years, and more help with the cost of living crisis.

A Compulsory Jobs Guarantee, help with childcare to make work pay, and a freeze on energy bills. That’s how we get Britain back on its feet and give hardworking people a hand against David Cameron’s cost of living crisis.

It’s been a bad week for the Tories and if they don’t come up with some real answers in the next few days it’s going to get a lot worse. Britain can do a lot better than this.

Unemployed young people stand in line outside a job centre in London. Photograph: Getty Images.

Liam Byrne is Labour MP for Birmingham Hodge Hill, cofounder of the UK-China Young Leaders Roundtable and author of Turning to Face the East: How Britain Prospers in the Asian Century.

Getty Images.
Show Hide image

Iain Duncan Smith says what most Brexiters think: economic harm is a price worth paying

The former cabinet minister demonstrated rare candour by dismissing the "risks" of leaving the EU.

Most economists differ only on whether the consequences of Brexit would be terrible or merely bad. For the Leave campaign this presents a problem. Every referendum and general election in recent times has been won by the side most trusted to protect economic growth (a status Remain currently enjoys).

Understandably, then, the Brexiters have either dismissed the forecasters as wrong or impugned their integrity. On Tuesday it was the turn of the Institute for Fiscal Studies (IFS), one of the most revered bodies in Westminster. In response to its warning that Brexit would mean a further two years of austerity (with the hit to GDP wiping out George Osborne's forecast surplus), the Leave campaign derided it as a "paid-up propaganda arm of the European commission" (the IFS has received £5.6m from Brussels since 2009). 

The suggestion that the organisation is corrupt rightly provoked outrage. "The IFS - for whom I used to work - is not a paid up propaganda arm of the EU. I hope that clears that up," tweeted Brexit-supporting economist Andrew Lilico. "Over-simplified messaging, fear-mongering & controversialism are hard-minded campaigning. Accusing folk of corruption & ill intent isn't." The Remain campaign was swift to compile an array of past quotes from EU opponents hailing the IFS. 

But this contretemps distracted from the larger argument. Rather than contesting the claim that Brexit would harm the economy, the Leave campaign increasingly seeks to change the subject: to immigration (which it has vowed to reduce) or the NHS (which it has pledged to spend more on). But at an event last night, Iain Duncan Smith demonstrated rare candour. The former work and pensions secretary, who resigned from the cabinet in protest at welfare cuts, all but conceded that further austerity was a price worth paying for Brexit. 

"Of course there's going to be risks if you leave. There's risks if you get up in the morning ...There are risks in everything you do in life," he said when questioned on the subject. "I would rather have those risks that we are likely to face, headed off by a government elected by the British people [and] governing for the British people, than having a government that is one of 27 others where the decisions you want to take - that you believe are best for the United Kingdom - cannot be taken because the others don't agree with you."

For Duncan Smith, another recession is of nothing compared to the prize of freedom from the Brussels yoke. Voters still reeling from the longest fall in living standards in recent history (and who lack a safe parliamentary seat) may disagree. But Duncan Smith has offered an insight into the mindset of a true ideologue. Remain will hope that many more emulate his honesty. 

George Eaton is political editor of the New Statesman.