Labour’s real guarantee: Workfare

A4E placards

Workfare: doesn’t work and not fair. Photo: Howard Jones

Last week saw the Labour Party announce its own form of workfare: the Job Guarantee. Labour, who introduced workfare and welfare reform into the UK whilst in government, now guarantees a number of things: It guarantees that yet again politicians will give billions of taxpayers’ money to subsidise big private businesses – probably the likes of failing and government contract reliant A4E, and workfare-users ASDA – helping them to drive up their profit margins. It guarantees to further undermine real job vacancies as companies replace job roles with subsidised compulsory short-term placements.

Labour, like the coalition government, also now guarantee to undermine the idea of a living wage, which just two months ago Ed Milliband appeared to champion. After all if a company can get staff forced to work for it, both provided by and subsidised by the state at minimum wage, why pay the living wage? Indeed, earlier announcements about the scheme suggest that it will include 10 hours unpaid, so will also be far below minimum wage. In addition, Labour’s ‘guarantee’ will only last for six months. With a revolving door workforce on tap, why would an employer create permanent jobs? As this campaign has revealed, workfare replaces paid employment, and undermines the wages of people already in work, who have seen their overtime and hours reduced: Debenhams is the latest to use workfare to staff its shops during the busy festive season.

With each placement lasting only six months, Labour guarantees to use its scheme to massage the unemployment figures, not giving those who finish their placements anything to go on to, but effectively resetting the clock on their long term unemployment. If you refuse to take part, then Labour guarantees harsh sanctions.

When Labour talk of training, they do not guarantee real skills training to get a job, or qualifications to gain employment in demand where there is a skills shortage. Past form suggests that what Labour guarantee as training, is shorthand for guaranteeing people sit in rooms and write up a CV at A4E or Deloitte-owned Ingeus for the hundredth time. After all it was Labour who guaranteed A4E’s first contract and Emma Harrison millions.

Some in Labour realise exactly what workfare means and are privately aghast at this policy initiative. While Labour join in promoting the idea that everyone who is unemployed is a scrounging benefits cheat, the fact is that spending on JSA is just 3% of the DWP’s budget. The majority of the social security budget is spent on pensions, and paying in-work benefits to those in work on low wages, wages made lower all the time by workfare. Yet ignoring such facts, this year one MP has promised that Labour will launch a ‘Workers not Shirkers’ campaign, guaranteeing to boost government spin which demonises those who are unemployed. Labour guarantees workfare. We guarantee to fight it.


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Arbeit macht freid, Comrade...


Liam Byrne would hardly be an obuiovs choice to do a policy review. After the last general election, he wrote about Labour's 2010 defeat purely in terms of the votes lost at that election. The 4 million votes lost before then completely passed him by! I do not see any 'new thinking' in the document about Britain's role in the world. Nuclear weapons are completely ignored and attacking other countries under the guise of protecting civilians is praised despite Iraq.

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Lewis Mackenzie

Quite disgusted by the way labour have hijacked the term "job guarantee". A real job guarantee promises a basic public sector job - at a living wage - to anyone willing and able to do one. The idea is that during a recession, the unemployed workforce is automatically absorbed into the public sector. The wages those workers receive act as stimulus to getting the economy moving again, and as spending growth resumes so do business sales, meaning that businesses can start hiring again and start to absorb workers back into the private sector (should they wish to go). It's based on recognition of the fact the sales drive jobs growth, and that when the economy stalls and everyone's broke, the government - creator of the money - needs to step in and start spending. It would have a huge number of benefits: it would protect the most vulnerable members of society from the effects of economic turmoil; it would provide a much better way to automatically stabilise the economy in times of crisis; the stimulus is precisely tailored to the prevailing economic conditions because it's determined by the unemployment level; it reduces the "discretionary" element of the stimulus, which is always cast as "wasteful"; it means people who are long term unemployed have a route back into lasting employment with the public sector and are more likely to find work in the private sector as a result (if they want it).

This labour plan, otoh, is bollocks.


Despite the leadership change labour are still at heart wannabe Tories.
Severing links with the unions shows what their true intentions really are. The only way they will be able to increase their funding is to beg (and hence give something in return) from big business.
Let's not forget it was Labour who appointed ATOS for disability assesments and started the Workfare programme in the first place.
Since being in opposition they have failed to attack either of these policies with any force and have jumped on the "workers not shirkers" bandwagon.
Don't expect any change should they manage to wheedle their way into power in 2015

James S

Having read both the BBC article and this article I can say without a shadow of a doubt that no government should 'force' people into jobs they do not want to do.

The 'Jobs Guarantee' in its simplest terms puts you into a NMW job for around 25 hours a week. It also offers guaranteed training from the employer; so even if you don't have the skills to pay the bills, so to speak, you will still be able to participate.

However, lets look at this further. Jobseekers currently get £113 per 2 week period, rising to £115 in April 14. On JG, a jobseeker would get £157 per week, and £315 per 2 weeks, almost treble what JSA would give. It is only logical people would go for this...

Except, with 2.7m people unemployed, that means having to create that many jobs. Naturally some members of our exclusive club don't want to work; fair choice, but that is still 2.5m jobs to create in the jobmarket.

But, if that were to be the case, why haven't they done so already? Short answer is, they can't. The fact is, workfare has already proven that forcing a company to take staff for free is much better than hiring someone. So when JG comes, they will have a steady stream of people to work there, and would never need to hire anyone at NMW salary.
This means that paid jobs will be phased out for JG, allowing businesses an endless cycle of workforce to work for them.

Which brings the major issue at hand: job saturation. If a job market has no more jobs to give, what happens to the rest of the jobless? Will we have to take turns with the JG, never finding a permanent job?

The Job Guarantee is better than workfare, simply because it pays people to do the work. But it still has a long way to go before it fixes unemployment.

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