Employment: Britain prefers carrot and stick approach

The British government has adopted a mixture of Continental "carrot" and American "stick" in its attempt to extract young people from the dole queue. Barrie Clement, Labour Editor, looks at the British approach to unemployment.

New Labour is convinced that improving the quality of programmes for out-of-work youngsters may be insufficient to ensure the participation of the real "hard cases". For those who refuse to avail themselves of the Government's flagship "New Deal" for youngsters there are swift and severe benefit penalties.

The New Deal for young people will provide an early test of the "third way" philosophy espoused by the Blair government. Ministers hope to chart a new course between the paternalism of Continental governments and the brash, authoritarian approach of the Americans.

As David Blunkett, Secretary of State for Education and Employment, declared this summer on launching the scheme: "Staying in bed on full benefits will not be an option."

The Government however will find it difficult to overcome the prejudice of some 18- to 24-year-olds who have seen discredited "schemes" come and go. For many, acronyms such as Yops and YTS characterise long periods of unemployment followed by short bouts of low-paid, casual work.

Training for Work, the latest programme established by the previous government for those over the age of 18, never quite achieved the goals set for it by ministers. The latest figures show that around 41 per cent of participants were in a job six months after leaving the scheme. Just 4 per cent secured the old apprentice-level skills.

Using the windfall tax on privatised utilities, Labour has expressed its determination to infuse the new policy with "quality, continuity and employability". Data published yesterday shows that the Training and Enterprise Councils, which will help to deliver the policy, have already recorded a substantial increase in qualifications achieved on courses they manage for young people.

The New Deal will provide four options which the entrant will be invited to choose as part of a process of induction: a subsidised job with the private sector, work with a voluntary organisation or with an environmental task force, or full-time education or training.

For those completing the course, civil servant "mentors" will attempt to guide those whose prospects have not improved "to avoid them slipping back into disillusionment".

Ministers have earmarked pounds 3.5bn over the next four years for the policy and 13 pilot schemes all over the country are expected to start next January.

The Government plans to withhold 40 per cent of an individual's personal benefit for "unreasonably" refusing the opportunities on offer. A young, fit, single man without dependents living at home would see his state payments reduced from pounds 37.90 to pounds 22.74.

Ministerial assurances that the "stick" will be used sparingly against recalcitrants, have been unable to overcome misgivings. Clara O'Donnelly, researcher at the Charity-funded Employment Unit, argues that there are many within the Employment Service which emphasises the need to "police" people on to schemes.

She argues the success of the new initiative depends not only on the commitment of politicians, but also on the attitude of officials.

"Senior officials who have dealt with other schemes are incredibly enthusiastic. They say they wouldn't have liked any of their children to have gone on those, but believe it is possible that the new initiative may given young people something to take away with them," she said.