From October Jobseekers who have failed to find a job at the end of the Flexible New Deal programme will be required to undertake full time employment for between £50 and £65 a week, the equivalent of as little as £1.27 an hour. Concerns have already been raised that, with the numbers of unemployed rising, people who genuinely cannot find a job will be forced to work for next to nothing in an unsuitable role.
Alex Halligan from Salford Unemployed Workers’ Union said, “It’s disgusting that they’ve chosen to trial this in an area with such high unemployment. This scheme is a further attack on the right of people who can’t find work to get the support they need.” Those who opposed the scheme say that it fails to take into account personal circumstances or the condition of the economy.
WfYB is being introduced as part of the government’s wide-ranging reform of the welfare system. Other elements include lowering the age up to which parents can claim child support and measures to force more people off incapacity benefits.
Workers wages could fall by 12 per cent
Some suggest that the scheme will affect the working population as well as those claiming benefits. “This flood of unwaged labour into the market will have a big effect on low waged jobs. When a similar scheme was introduced in the US there was a 12 per cent decline in pay for low-income jobs,” Rebecca Galbraith from ‘No to Welfare Abolition’ told MULE.
Commenting on the fact that private companies rather than Jobcentres will be running the WfYB programme, she added, “Whoever runs this scheme it will be a disaster, but private companies can set arbitrary targets and are much less accountable.”
Businesses will be paid for each person they get into a work placement. This has raised fears companies might ignore difficult cases or put people into unsuitable positions just to receive the commission.
Labour MP John McDonnell placed a parliamentary question in December regarding the employment rights that participants in the scheme will be entitled to. He is concerned that, since they will not be technically employed, those taking part may be put in danger as they may not be covered by health and safety legislation.
Charities set to lose out
Charities and social institutions that rely on volunteers, many of whom are also Jobseekers, have expressed concerns that WfYB will take these people out of important roles and put them into positions that have no benefit to the community.
“The government does not care that many ‘claimants’ are not actually idle and do a lot of unpaid work like caring for others. Real voluntary activities will suffer if people are kicked into work schemes under this pilot,” said Mike from No to Welfare Abolition.
Alongside the WfYB scheme an alternative Jobcentre Plus regime will be trialled, designed to offer Jobseekers increased adviser contact and access to a personal support fund. This trial will receive just £3.5 million of funding whereas the WfYB programme will receive £15 million, raising questions over the government’s priorities.
Tenders for the running of the scheme have been submitted and will be allocated in April. It remains to be seen which employers will be taking advantage of the cheap labour, or the kinds of jobs people will be expected to do.