@RishiSunak to unveil 2020 #SpendingReview that will create and support hundreds of thousands of jobs across the UK
The Chancellor is also set to announce new three-year £2.9 billion Restart scheme to help one million unemployed people in their job search – alongside £1.4 billion of new funding to increase Job Centre Plus capacity.
Tens of billions of pounds of investment in infrastructure will support jobs and spur Britain’s recovery from coronavirus.
HUNDREDS of thousands of jobs will be created and supported through a multi-billion package of investment that is expected to be announced by the Chancellor at tomorrow’s (WED) Spending Review.
Building on his commitment to support, protect and create jobs, Rishi Sunak will also unveil the government’s new three-year £2.9bn Restart scheme to help more than one million unemployed people look for work. Individuals out of work for over 12 months will be provided with regular, intensive jobs support tailored to their circumstances.
He will also announce £1.4 bn of new funding to increase Job Centre Plus capacity so more people searching for work can get the support they need.
Mr Sunak, who will also announce tens of billions of pounds of capital investment to level up opportunity, drive growth and create jobs across the UK, said:
“My number one priority is to protect jobs and livelihoods across the UK.
“This Spending Review will ensure hundreds of thousands of jobs are supported and protected in the acute phase of this crisis and beyond with a multi-billion package of investment to ensure that no one is left without hope or opportunity”.
He will also confirm funding for the next stage of his Plan for Jobs – including £1.6 bn for the landmark Kickstart scheme in 2021/22, which will see the creation of up to 250,000 government-subsidised jobs for young people.
The apprenticeship hiring incentive that launched in August, has been extended to 31 March 2021 and pays employers £2,000 for apprentices hired aged under 25 and £1,500 for those aged 25 and over.
The £375m skills package will start delivering on the Prime Minister’s Lifetime Skills Guarantee, with £138m to fund in-demand technical courses equivalent to A levels (level 3), and expanding the employer-led boot camp training model. This also includes £127m funding to continue skills measures in the Plan for Jobs into 2021-22, investing in sector-based work academies and traineeships, and investing in the National Careers Service to enable more adults to access high quality careers advice.
The ambitious plans for capital investment – which will include the building of new roads, houses, railways and cycle lanes – will support and create hundreds of thousands of jobs across the country, with the Prime Minster already pledging up to 250,000 highly skilled green jobs as part of this ten-point plan for a green industrial revolution.
This Spending Review follows nine months of unprecedented support for businesses and individuals including helping to pay the wages of people in 9.6 million jobs across the country through the Coronavirus Jobs Retention Scheme (CJRS) – which has been extended until March 2021 – and supporting the livelihoods of 2.6 million self-employed workers.
This Spending Review will announce the following new DWP funding to support jobs:
- £400m investment in 2021-22, the first step in the £2.9 billion three-year Restart programme.
- £1.4bn to build on the Plan for Jobs commitment to increase capacity in Job Centre Plus and double the number of work coaches.
Employment programmes have a proven track record of delivering positive fiscal return.
For example, a recently published cost benefit analysis of the Work Programme estimates an Exchequer impact of £3.21 per £1 spent over four years for participants aged 25 and over and unemployed for a year.
Using the evaluation’s average additional days in work figures, we would estimate 30% of those supported by the programme found work after two years, compared to 23% of those in a comparison group.
Based on learnings from this and other previous employment programmes, the new Restart programme has taken into account the following improvements:
- building strong customer service standards to ensure customers receive the intensive support they need;
- placing customer satisfaction at the core of the programme, by measuring customer satisfaction as part of performance management; and
- taking advantage of the wrap-around support offered by UC, with on-going support from work coaches, and creating 3-way channels of communication between providers, DWP and claimants.
So what is the FE, Skills and Employability Sector Response:
Association of Employment and Learning Providers managing director Jane Hickie said,
“The extension of the apprenticeship hiring incentive could be an important boost to the recovery efforts, especially among smaller businesses where the first set of incentives has proved particularly attractive. Retraining adults affected by the pandemic’s impact is absolutely essential and so new funding for the Lifetime Skills Guarantee will support key sectors. Training providers across the country are ready to play a key role in ensuring that the maximum number of employers, young apprentices and existing members of the workforce benefit from these welcome measures.”
Responding to the Chancellor’s skills and jobs announcement ahead of the Spending Review, AoC’s Chief Executive, David Hughes said:
“The Chancellor is right to invest now and over the coming months in securing jobs and improving skills. The steps set out are the right things to do given the effects of the pandemic look set to be with us for longer than most people expected. Extending the apprenticeship incentive scheme, Kickstart and traineeships are certainly helpful in the short term and will help to support the increasing numbers of young people that need opportunities.
"The Lifetime Skills Guarantee will open up qualifications to people who need to access training and reskilling opportunities. While colleges stand ready to support more young people and adults, they are eager to see the details so they can plan their offer. It also requires flexibility to allow as many adults to access much-needed opportunities, regardless of circumstance. Support for those at risk of being left behind is more important than ever as we map a route out of the pandemic that supports businesses, communities and people.
"There are number of issues that DfE will need to address as spending budgets are set which are vital for colleges to know as soon as possible. These include an extension of the TPS employer contribution grant; capital funding including technology investment; funding for the 100,000 students still losing out on learning due to digital poverty; extra cash this year for the growth in 16-19 numbers and the impact that will have on 2021/22 allocations. It is good news that a funding package has been confirmed to kick-off the Lifetime Skills Guarantee but without an increased funding rate our analysis shows that this will not be viable to deliver.
"I hope DfE can prioritise investment in a skills-led recovery, enabling colleges to support the economy, people and communities that need them most.”
Tony Wilson, Director at the Institute for Employment Studies said:
"We knew to expect new measures for the long-term unemployed tomorrow, but the news that this could be worth £3 billion over three years is very encouraging. We’re estimating that around 200 thousand people who started claiming benefits during the pandemic will have reached long-term unemployment by next summer, when the Restart programme will likely roll out. This would be nearly double the number of people referred during the first few months of the Work Programme in 2011, which was itself the largest employment scheme in our history. Delivering something similar to that would likely have cost around £1 billion over three years, so the far higher level of funding in Restart suggests that either a lot more people will be brought into support, or that a lot more help will be available.
"Inevitably however, the devil will be in the detail tomorrow. Key things to look out for will be how quickly the programme can go live, how long individuals will be supported for, who will be eligible, and what sorts of additional provision will be available to help with things like training, work experience, transport and so on. In our view, this programme needs to be in place by next summer at the latest, it needs to guarantee that all of those on the programme will get specialist, frequent and one-to-one support, and there needs to be substantial funding for re-training and other support – either through the programme or alongside it. Finally, Restart will need to work far better with local partners than the Work Programme and its successors have done. The contracted-out market for employment programmes is just one sixth the size that it was on the eve of the last crisis, so delivering this quickly and well will be a huge undertaking and will need to make much more use of the wealth of expertise in local services, local government and the voluntary sector".
Matthew Fell, Chief Policy Director, CBI, said:
“COVID-19 has swept away many job opportunities, for young people in particular."
“The Chancellor has been tireless in his efforts to protect jobs throughout the crisis and, as the UK begins to eye a recovery in 2021, attention is rightly turning to how to create new jobs."
“The scarring effects of long-term unemployment are all too real, so the sooner more people can get back into work the better.”
A Tesco Spokesperson said:
‘At this challenging time for businesses we welcome this package for jobs and boost for training from the Chancellor. We welcomed 1,000 Kickstarters to our business earlier this month and are also pleased to see initiatives such as the Lifetime Skills Guarantee, which will help us to ensure that our colleagues, new and old, are able to upskill and continue their career development.’
Michelle Ovens MBE, Founder, Small Business Britain, said:
“With the massive challenges facing the UK economy this year, it is encouraging to see the Government investing in driving job creation. Last year SMEs accounted for three fifths of private sector employment in the UK and will be the engine of recovery post covid. We welcome this support to help drive future growth and career opportunities, particularly across small businesses as we move into 2021.”
Claire Walker, Co-Executive Director, BCC, said:
“The impact of Coronavirus on firms' ability to create and retain jobs has been significant.
“To help business communities rebuild, it is vital that government supports them to re-train and re-skill the UK workforce. Investment in Kickstart, in which Chambers are playing a leading role, and the launch of the Restart scheme, will be critical in helping support the recovery.”
Scott Parkin, Chief Executive of the IEP said:
"Whilst we await the detail we see this announcement as a positive step in the right direction for the economic recovery to tackle the challenging job seeking environment that many people find themselves in as a result of this pandemic.
"We believe that services that support people to move into the right job opportunity as quickly as possible are critical to this recovery so it is important to note those 1000’s of Practitioners across public, private and charitable sectors that are already working very hard to deliver great support, advice and guidance, often remotely via the use of technology. This group of professionals will be on the frontline of service delivery, working and collaborating with others to provide facilities that develop employability skills for all that need help and supporting the re-skilling of those that, as a result of the pandemic, may have to change industry sectors to find work.
"The IEP is supporting sector partners to continue to develop learning and development resources that will deliver service excellence at this time of national need".
Stephen Evans, Chief Executive of Learning & Work said:
“It’s great to see the Government investing in support to help people back to work and to improve their skills. Our research shows how high long-term unemployment may rise next year, and we’ve already seen groups such as younger people harder hit by the crisis so far.
"The new Restart programme and expansion of Jobcentre Plus capacity are therefore welcome, although I would like to see a greater focus on improving skills and links to local support services. There is still time for DWP to build this into their commissioning. Similarly, initiatives like Kickstart are welcome, but need to be better integrated as part of a Youth Guarantee that tailors support to young people’s needs.
"We also shouldn’t lose sight of the stark skills challenges we faced before coronavirus. The Lifetime Skills Guarantee is a start, but we need far more investment in basic skills and entry level learning. A ladder of opportunity is no good if it has rungs missing. Time for a long-term lifelong learning strategy.
"The economic picture is stark, but the prospect of effective vaccines brings the hope that this is the beginning of the end of the current crisis. That makes is even more critical we extend a hand of help to everyone that needs it.”
David Gallagher, Chief Executive, NCFE comments:
"The scale of the challenge for adult job seekers cannot be underestimated, exacerbated by the pandemic, meaning people of all ages are finding their existing skills no longer in demand.
"We recognise that the government has already taken significant action to support unemployed people and we welcome this further intervention specifically for adults. The key for those of us in education and skills is to understand where the employment opportunities will be, which sectors are growing as others shrink, and identify how we can equip individuals with the tools they need to train, retrain, and ultimately secure a fulfilling job role. We look forward to hearing the details of the scheme - which we hope can be rolled out at pace - and how we can support this through our employability training for adults".
Ronel Lehmann, Founder and Chief Executive, Finito, The Employability Experts said:
“Let us not forget that Rishi Sunak in his younger days gained valuable work experience serving diners in a restaurant.
"He may be fortunate to have risen to one of the Great Offices of State but I bet that he hasn’t forgotten the impact and experience of securing that first job as a young person whilst at school.
"I believe him when he expresses his demonstrable commitment to protecting jobs and livelihoods across the UK.”
Elizabeth Taylor CEO of ERSA said:
"The Employment Support sector welcomes the announcement of Restart commissioning alongside investment in infrastructure, capital investment, job creation, green jobs, sector-based training, traineeships, and the expansion of the National Careers Service.
"We hope the expansion of front-line advisors at Jobcentre Plus will ensure the right people are referred to the right provisions at the right time. The Employment Support sector itself will expand to meet the challenges of future delivery and this work has begun with partnerships and collaborations being developed to increase capacity and to build diverse supply chains that will reach into local communities through knowledge of employers, with local partnerships bringing in the expertise of third sector partners, specialists, local authorities and recognising that health and housing issues will factor into the success of economic recovery.
"For the Employment Support sector Restart is a start, we look forward to the details of allocation of ESF reserves and the future Shared Prosperity Fund to provide effective employment support for all".
Steve Sugden comments on Restart:
"Without pre-empting the actual announcement, on paper this looks positive. The £1.6bn for Kickstart, if this is additional funding as opposed to rebadging of that already committed, then a total package of £3.6bn to support young people has to be welcome. That said, I am still not convinced they have the model working at its most efficient.
"If my maths is right then with these sums, and providing they hit the target of 250,000 placements, puts the cost of each placement at around £14,400. Bearing in mind that if all placements earn the minimum wage for those aged 21-24 then each placement should cost a around of £7-7.5k. This suggests that they could be targeting 500,000 and ensuring that all participants, regardless of age earn a living wage. I still think that for those under the age of 21 this programme is unaffordable as it stands.
"Again, looking on the positives, government has listened to business and has made it slightly easier, but not perfect yet, for companies who cannot offer 30 placements a way to engage. We had the recent announcement that to date there have been 19,000 starts on Kickstart though looking at some of the employers listed I do wonder what are these newly discovered roles that they are filling.
"As mentioned above SMEs filled 60% of private sector jobs last year and could be offering the same for Kickstart. The issue will be that they just do not have the time or resources to engage with the programme. At present an SME has to find the Kickstart Gateway. I would suggest it would be more beneficial for the Gateways to look for employers.
"This would come with a cost and maybe government could look to invest some of the, currently, missing £7,000ish per placement, in supporting third sector specialist youth engagement organisations to take on this role. These organisations are out there, and conversations I have had over the last few months suggest they would welcome the opportunity. The benefit to both the employer and young person, is that they understand the barriers and issues these young people face on a day to day basis. With sufficient funding they could offer both support to employers to set up a placement, provide ongoing placement management and, most importantly, give ongoing support, advice and guidance to the young people".
Sam Windett, Director of Policy at Impetus and co-chair of the Youth Employment Group said:
"The amount of funding and scale for the new Restart programme is welcome, at £2.9billion this will be a huge initiative which we know needs to serve many young people who will have sadly found themselves long term unemployed by next summer.
"However, the government will again find itself having to balance this urgency with getting the programme right - in only a short matter of months. If the taps hadn’t been turned off in employment support so severely over recent years, we wouldn’t face such a difficult cliff face to climb now. The DWP’s naive stop/start commissioning behaviour has created these issues at a time when job support is needed most.
"Without applying the learnings of past programmes, combined with the speed and scale of the job support needed, the risks of not getting the right tailored, localised support to young people are very high".
Andrew Harding, FCMA, CGMA, Chief Executive — Management Accounting, The Chartered Institute of Management Accountants, part of the Association of International Certified Professional Accountants, said:
“We welcome the focus on jobs in the Chancellor’s Spending Review today, but we are concerned that it does not go far enough to tackle the country’s systemic issues such as our faltering productivity, widening skills gap and supporting the levelling up agenda. As we come out of the pandemic addressing these issues will be critical, or they risk becoming more acute in the post-Brexit world.
“Worryingly, CIMA research carried out last week revealed that 84% of UK SME workers surveyed are not currently undertaking skills training or professional development and only 3 in 10 SME workers have undertaken skills training and professional development in 2020. This complacency towards learning and development was a nagging issue prior to the coronavirus crisis and could hamper the country’s long term recovery if attitudes towards learning don’t change. This will require a concerted effort involving the government, employers and employees.
“To deliver the transformational skills needed for a post-Brexit Britain, we are urging the government to introduce a package of policies to help all workers reskill and upskill. In fact, in our survey 6 in 10 SME workers (60%) said they believe that it would be a good idea to incorporate mandatory training hours in the extended Coronavirus Job Retention Scheme (CJRS). In addition, we support the creation of a rebuttable right to retrain to empower workers to request further training and professional development and changing the Apprenticeship Levy to an Apprenticeship and Skills Levy for all workers to ensure businesses have the talent they need now and in the future. We must act now to develop and build a workforce fit for the post-pandemic world.”
Simon Carter, Director at RM Education:
“The increased investment on education infrastructure in today’s spending review will be welcome news to schools across the country. And, while much of this investment will go towards maintaining and renovating school buildings, in the post-Covid world it is worth remembering that that infrastructure is now digital as well as physical. Following a year of significant change for the sector, from digitally transforming how teachers deliver lessons, to introducing and embracing hybrid teaching models, the role of technology within schools has revolutionised the way pupils are educated in this country for ever.
“Schools are now much more accustomed to using technology within their lesson plans. And this can take many forms, including remote learning for when students are unable to get into school; online collaboration with peers; better class engagement, from quick check-ins with tutors to submitting assignments and homework, to simply making the most of classroom time through a blended learning approach. Whether facing a future pandemic, or simply combatting bad weather, a school based around a modern, robust technology platform is one that will enhance the education of our children – in the next generation and beyond.”
Becs Roycroft, senior director at technology training academy and talent provider mthree, commented:
“This year has been devastating for countless businesses and individuals, so the announcement of new government help for those out of work, including a £375m skills package to open up access to training and reskilling opportunities, is very welcome.
“However, we also need to urgently look at what we can do to prevent unemployment and redundancies in the first place wherever possible.
“There will be many larger businesses that are in a strong position to support the work that the government is doing, by retraining their own employees and moving them from struggling departments into teams that are still flourishing.
“Tech jobs have been amongst the least affected by the pandemic, with demand for skilled employees still incredibly high. However, due to the digital skills shortage, businesses find it notoriously difficult to recruit people for tech roles.
“Strategic reskilling programmes are a practical solution to this issue. By training existing employees and moving them into tech roles, businesses can tackle the growing skills shortage in a cost-effective way, while also preventing redundancies and protecting their workforce in the long run.
“Investing in reskilling programmes does not just provide a sustainable talent pipeline for businesses. It also minimises the time and expenses spent on external recruitment, removes the risks associated with making a bad hire, improves diversity across technology teams, and helps to create a loyal, motivated and engaged workforce.
“If the government is really serious about upskilling and training, it would be great to see it actively encouraging more businesses to consider this option, and offering help and support where needed to make it feasible for as many organisations as possible.”
Jo Ingold FIEP, Associate Professor, Deakin Business School said:
"Support for the long-term unemployed is very welcome. However, we need to ensure that people who need support before they reach the one year point receive this. Support should be tailored to what people need, in terms of the nature and method of delivery (face-to-face, digital or blended) and to take account of where people are in their employment journey.
"At the same time, we must make sure that people who face additional labour market barriers are not pushed further to the back of the labour market queue. Finally, it is critical that employers are central to both commissioning and delivery of employment support. It is counter-productive to merely focus on preparing people for work without ensuring there is connection with labour market demand. This requires commissioners of programmes to consider how they can encourage effective employer engagement in Restart (and other programmes), as well as foster a collaboration amongst providers to better service employers. Genuinely taking account of both will pave the way for more effective delivery on the ground".