Places with the highest levels of joblessness will get extra NHS support as the government bids to “get Britain working again”.
Work and pensions secretary Liz Kendall will announce the plans today as part of wide-ranging reforms designed to tackle economic inactivity and deliver the government’s promise to bring more than two million people back into work.
She said: “To get Britain growing, we need to get Britain working again.
“Our reforms will break down barriers to opportunity, help people to get into work and on at work, allow local leaders to boost jobs and growth, and give our children and young people the best opportunities to get on in life.”
While unemployment stands at almost 1.5m, economic inactivity has also soared to more than 9m, with 2.8m people out of work due to long-term sickness – a major driver of the rise in joblessness since the pandemic.
In their election campaign, Labour promised to increase the employment rate to 80 per cent from its current level of around 75 per cent, which would mean around two million more people in work.
New careers service
As well as providing extra capacity to cut waiting lists at the 20 NHS trusts with the highest levels of economic inactivity, Kendall’s plans will see an expansion of mental health support and efforts to tackle obesity.
Alongside the focus on improving health, Jobcentres are set to be replaced by a new National Jobs and Careers Service, focused on helping people into work rather than monitoring benefit claims, with some £55m in funding.
Other policies include providing additional employment and training opportunities for young people and extra powers for mayors to develop their own employment plans.
Tackling economic inactivity, which has risen by 600,000 people since the pandemic, is seen as vital to economic growth and will help cut a spiralling welfare bill.
Prime Minister Sir Keir Starmer said: “From the broken NHS, flatlining economy, and the millions of people left unemployed and trapped in an inactivity spiral – this government inherited a country that simply isn’t working. But today we’ve set out a plan to fix this.
He said reforms would “put an end to the culture of blaming and shaming people who for too long haven’t been getting the support they need” and help them into “decent, well-paid jobs”.
‘No option’ of benefits life
But Kendall also made clear that the government expected those who were able to work to take up those opportunities.
Referring to the last Labour government, she said on a visit to Peterborough: “We said there was no option of a life on benefits, and that principle remains the same today.”
The plans were welcomed by the Chartered Institute for Personal Development (CIPD), whose boss Peter Cheese said they were “a step in the right direction” but called for “more ambition” to “make apprenticeships a viable alternative to university”.
Disability charity Scope also welcomed the announcement as “a positive vision for supporting disabled people into work”, but warned a “lack of trust” in the Department for Work and Pensions (DWP) could “seriously undermine” the plan.
But shadow work and pensions secretary Helen Whately said: “This latest announcement shows that Labour are not prepared to take the tough but necessary choices to bring down the benefits bill. There is no attempt to match the £12bn in welfare savings we promised in our manifesto.
“They have even dodged the difficult decisions on sickness benefits, which are needed to make the welfare system sustainable in the long term.”
She added: “To get people off benefits you also need jobs for them to go to. But Labour’s disastrous anti-growth Budget is already making businesses think twice about taking people on.”