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Welfare to work raises unrealistic expectations

FRESH doubts have been raised about the prospects for the Government's welfare-to-work projects just as the New Deal for the young unemployed goes nationwide. Two separate reports published yesterday warned that hopes for the schemes were unrealistically high.

Incomes Data Services, the employment research consultancy, said analysis of the working patterns of lone parents showed that a high proportion already worked. Government plans would make them better off if they had a job, but more lone mothers are in work than the politicians suggested.

Official figures show that four out of 10 lone mothers are employed, and another one in 10 is already looking for work, according to IDS. Those with school-age children are even more likely to be employed, with 70 per cent of lone mothers with children over 11 in employment.

Among lone mothers educated to degree level, the proportion working climbs to nearly 90 per cent.

The report concluded: "Lone mothers in particular are more likely to benefit from the childcare tax credit." This subsidy, announced in the Budget, was well-targeted as it would mainly go to low earners, it said.

Separately, a new book by David Willetts, a minister in the Conservative government, claims the New Deal has generated unrealistic expectations. Among the concerns highlighted by the book, published by the Social Market Foundation, are the fact that the Government's schemes will mainly help those who would have found jobs anyway, and the problem that jobs are not available in the places where unemployment is highest.

Mr Willetts points out that unemployment in the two main categories of people qualifying for the New Deal, those aged 18-24 unemployed for more than six months and older claimants unemployed for more than two years, had already fallen more rapidly than the jobless total.

The book also notes that half of those eligible come from just 18 small areas in a handful of cities. The areas of high unemployment have few vacancies and few participating employers.

The Department for Education and Employment said yesterday that more than 16,000 unemployed 18-24 year-olds have taken part in the New Deal since the scheme was launched in 12 trial areas in January.

The multi-billion-pound programme, under which employers are paid pounds 60 a week for taking on an eligible person, will roll out throughout the country from Monday.

IDS Report 758, April 1998, 0171 250 3434.

'Welfare to Work' by David Willetts, Social Market Foundation, 0171 222 7060.