Nicola Smith's Archive — Page 2
I’m Head of the Economic and Social Affairs Department at the TUC. I also represent the TUC on the Social Security Advisory Committee. My posts may therefore range from the environment to the welfare state via macro-economic policy but will inevitably provide more detail in some areas than others. In my previous roles I specialised in labour market policy and coordinated the work of the Commission on Vulnerable Employment (CoVE). Before joining the TUC I worked in research and policy roles for Barnardo’s, the Children and Young People’s Unit at the old DfES and the Centre for Economic and Social Inclusion.
Nicola Smith
The Government’s ‘work experience’ programme has been moving up the news agenda, with the FT, the Express and the Daily Mail among those whose reports of yesterday’s ‘error’ (when an unpaid placement was advertised as a ‘vacancy’ on the Jobcentre Plus website) defined the programme as a ‘workfare scheme’. And even the Institute for Economic Affairs has recognised that the schemes provide free labour.
How has this happened?
Nicola Smith
The TUC achieved widespread coverage yesterday by highlighting the growing scale of under-employment across the UK. With papers including the Mirror, the Guardian, the Independent and the Metro covering our analysis and many broadcast media running the story. Today’s figures show the picture is still extremely challenging, with 2.67 million people unemployed, 2.26 million people who are economically inactive and want a job and a further 1.35 million people who are working part-time but are looking for full-time work.
Nicola Smith
Without much fanfare, the Government has recently launched its New Enterprise Allowance scheme which aims to ‘give extra help to unemployed people who want to start their own business’. The scheme provides a package of support worth £1,274 over 26 weeks, with access to a volunteer mentor. What’s the catch? Although, as CIPD have recently shown, most newly self-employed people are undertaking odd jobs and would perfer to be paid employees, what could be wrong with helping those who want to to make a little extra cash and remain in some form of work rather than claim JSA?
The answer is that the package is in fact meaner than it first appears, apparently comprising a weekly payment that is slightly less than JSA for 13 weeks (£65) and which falls to £33 a week for the remaining 13 weeks, leaving someone on the scheme who isn’t successfully making any cash with less than they would have had on benefits. But even more worrying is the option that all participants will have the opportunity to take out a loan of up to £1,000 repayable at a 10 per cent interest rate to support their businesses.
Nicola Smith
Defending his benefit cap on the Today programme this morning Iain Duncan Smith claimed that those who ‘do the right thing’ and move into work will not be penalised. The direct implication of this is that those who are currently unemployed are failing to take his advice and act in a morally correct manner – if they did, they’d all have jobs.
This view is an insult to the 2.68 million people who are unemployed and looking for work. There are 463,000 jobs available in the economy (down 18,000 on last year and down 34% on pre-recession levels).* There are over one million more unemployed people looking for employment than there were four years ago. The ratio of unemployed people to jobs currently 5.8. Factor in the far from perfect match between the geographical locations (see Anjum’s regular round up of the areas of the UK where there are as many as 32 claimants for every available post) and skills profiles of jobs and claimants, and that family committments mean the hours of work offered won’t fit with the caring responsibilities of every unemployed worker, and the picture becomes even bleaker. It is simply not feasible for everyone who is out of work to find employment.
Nicola Smith
In the week when unemployment has hit a 17 year high, David Laws picked a great moment to proclaim the existence of ‘the great democratic recession‘. According to his analysis we need to keep our pessimism in check – there’s lots to be cheerful about.
The main reason for this outburst of optimism turns out to be that ‘everyone feels the pain, rather than just certain sections of the community as in the Eighties and Nineties’. Apparently the ‘democratic nature’ of the recent downturn, combined with various pieces of recent ‘good news’, mean that it’s time to stop worrying. Unfortunately, this assessment doesn’t stack up.
Nicola Smith
Even against the billing it got this morning on the Today programme (where it was anticipated that it would contain ‘little substance’) Cameron’s speech on responsible capitalism appears to have fallen flat.
On the basis of today’s performance it appears that the Prime Minister believes the excesses of corporate Britain can be solved by less regulation, and a Cooperatives bill. Apart from that we had some dubious sounding statistics, lots of bland assertions and an attempt to argue simultaneously for unconstrained free markets and measures to keep the unacceptable extravagances of turbo-charged capitalism in check.
But this is an impossible position, leading to clear contradictions in Cameron’s analysis.
Nicola Smith
While Eurozone credit downgrades are currently high up the news agenda, there’s been less reporting of the reasoning behind their issue. The Standard and Poors’ press releases aren’t easily publicly accessible, but Stephanie Flanders has a good summary here, pointing out that:
A major ratings agency has now joined the side of those who say fiscal austerity, as the central plank of the response to the eurozone crisis, is doing more harm than good
She concludes that not one recent downgrade has been due to the ratings agency thinking the government in question was not sufficiently committed to deficit reduction, with fears of external contagion and poor future economic growth forming the basis for their decisions.
Nicola Smith
It is no surprise that many are asking what can be done about falling living standards. The wage squeeze in the months ahead is set to be worse than during the Great Depression and households are £522 worse off now than was the case this time last year. And it is not just the falling real wages of the last few years that are concerning – incomes for those on middle incomes have been stagnating since 2003.
But the challenge is finding meaningful policy solutions which will improve this situation – both in the short and longer terms.
Nicola Smith
Recent economic debate in the UK can sometimes seem to be dominated by deficit reduction. But while there is plenty of polling showing that the public recognise that the public finances need to be put into better shape, there has been little recent coverage of wider public concerns about the direction of travel our economy is taking. Although falling living standards and rising unemployment dominate the domestic news agenda the political debate on still centres on the public finances rather than, whatever the fiscal constraints, how to secure the best outcomes for UK households.
So recently published You Gov polling (commissioned by the Fabian Society and the TUC, and covered in today’s Independent) has sought to look in some more detail at public views on the direction that recent economic policy approaches are taking us in.
Nicola Smith
New data on the operation of the Government’s National Insurance Holiday Scheme has now been laid in the House of Commons library. When this scheme was announced, it was estimated that over three years 400,000 new businesses would benefit by having a lower tax bill from employing new staff and that 800,000 new jobs would be created.
Today’s data reveals that over the first year of its operation 3,345 employers have taken advantage of the scheme (1% of the total anticipated number) and that the NICS holiday has been claimed for 12,411 employees (2% of the anticipated number of jobs).
