Audit Office critical of New Deal scheme

A new National Audit Office report has
suggested that many of those who have found work through the New
Deal for Young People welfare-to-work scheme would have found work
anyway.

A quarter of a million young people found work
by September 2000, rising to 339,000 by October 2001. But the NAO
report estimates that only 20,000 of these would not have got a job
without the New Deal. Each job cost around £5,000.

The scheme was introduced in April 1998 to
help long-term unemployed people aged between 18 and 24 move into
employment.

Head of the NAO Sir John Bourn said the
programme had had a beneficial effect on the UK economy but warned
that it might need to focus on a smaller group of unemployed young
people, many of whom face barriers to employment such as
homelessness, criminal records, drug or alcohol dependency, and a
lack of literacy and numeracy skills.

Meanwhile, a second study of the impact of the
New Deal for Young People in Manchester, Salford, Tameside and
Trafford, has found that voluntary sector employers underestimated
the real financial and organisational costs of supporting New Deal
employees, adding that it was not uncommon for the scheme to be
cross-subsidised by other areas of work and volunteer activity.

The report, by Greater Manchester Centre for
Voluntary Organisations and Manchester University, concluded that
while the government demonstrated a positive and consistent
approach to New Deal policy initiatives, their number and speed had
led to “uneven progress”.

– The New Deal for Young People from
www.nao.gov.uk and New
Deal: High Stakes from 0161 277 1012