We must deal head-on with the structural issues that allow the nation’s human capital to be trapped in a permanent state of unemployment, funded by higher taxes on those in work. The current Government does not have a plan for a working Britain.
The unemployment rate for 18-24 year olds in Medway is more than 7.5%, and the local economic inactivity rate is 16.4%—representing over 29,000 working-age adults not seeking work. This is a burden that cannot be sustained and is both politically and fiscally immoral.
The author acknowledges that there are individuals with severe physical and neurological conditions that render them unfit for work. It is right that such individuals receive the support from the taxpayer to lead the best possible life with dignity.
Net Zero
Government Net Zero Policies are destroying jobs and holding back investment in UK manufacturing jobs. It is estimated that the cost of policy initiatives and green levies will reach 60% of the cost of energy in the foreseeable future.
Britain’s business electricity prices are the highest in the G7 and are likely to increase as further green levies are imposed to pay the cost of higher strike prices. This is a disaster for workers not able to access the knowledge economy and reliant on traditional jobs.
The nation needs an immediate end to levies on green energy and a strategy to produce more energy from within the UK. This will mean fossil fuels, nuclear and wind where it can compete with traditional sources.
Compounding this economic self-harm is a welfare system that actively subsidises inactivity.
Reforming Welfare to Make Work Pay
Welfare must be reformed to ensure that work always pays and that a permanent state of unemployment is not acceptable. There are not enough sticks in the system; instead, program after program seeks to encourage rather than expect those dependent on the State to be in work. Working is no longer the expected default state for individuals in the UK.
Those in work must always be better off in work. This implies that at the minimum wage level, welfare payments are acting as a huge disincentive to work. There is clearly a gaming of the system that enables individuals to claim Universal Credit plus PIP to obtain payments that are above the National Minimum Wage.
I believe that welfare payments should be time limited to encourage work and that an element of incentive that encourages transition from welfare to work is implemented. There should be a tougher statutory requirement placed on individuals to demonstrate that they are taking responsibility for getting themselves back into work.
A more radical approach would include that out of work benefits should be provided through a private insurance system with Employers’ National Insurance Contributions diverted to provide benefits such as a personal accident and sickness cover, higher pension contributions, and private healthcare.
Fixing the Skills and Wage Pipeline
We must immediately support investment in training and provide a clear pathway for young people to enter the workforce and not welfare.
To immediately give this generation the best chance of securing a foothold in the workforce and starting a career, we must reduce the tax burden on employers and commit to increasing the National Minimum Wage by no more than the rate of inflation. Unskilled workers are being priced out of work through a combination of high wages, taxes on employers, and lack of skills.
We need fundamental reform of apprenticeships by reducing bureaucracy and by funding further education colleges to respond directly to local skills gaps.
Dealing with the Long-Term Sick
Much of welfare payments to working age adults is due to poor health.
The private sector should be brought in to focus on the sick long term unemployed to ensure that market efficiencies and patient choice are leveraged to get those with health conditions fit for work. An initial focus on the under thirties will hopefully stop ill health from becoming embedded leading to a lifetime of unemployment and illheath.
Education
Reform of the current education system (Key Stage 2 through Key Stage 4) is essential to understanding and fixing the lack of attainment and poor attendance among children from deprived backgrounds and children with special education needs.
We must scrutinise university provision and ask whether the nation can continue to afford for so many young people to attend university when many would be better served joining the workforce at 18.
Bringing education, training, and health under a strong, local, devolved Mayor may provide the crucial lever needed to deliver these reforms.
Local Governance
Many of our local services operate with little or no local scrutiny, particularly in the health and education space.
Local Government Reorganisation offers an opportunity to bring the oversight of local services that much of the strategy outlined above depends on.
Directly elected Mayors would be the single, obvious point of accountability to implement the radical, integrated strategy outlined above.
The Time for Action is Now
Governments since the Blair era have used uncontrolled immigration as a method of fixing our workforce issues. The so-called “Boris wave” was, quite frankly, an affront to the nation’s long-term success.
The time to fix these issues is now, and it is urgent.
