Darling extends support to unemployed

9 December 2009

Measures to ease the impact of unemployment among the young and old have been announced in the pre-Budget report.

Chancellor Alistair Darling said he intends to provide a place in education or training for every 16 and 17-year-old leaving school in September next year. Youngsters not in education at the moment will be offered an entry into employment, supported by an education maintenance allowance.

The over-50s were also flagged up for support “to equip them with the confidence and skills needed to get a job”.

The chancellor reflected on the impact the financial crisis has had on unemployment figures.

“Such a deep global recession was always going to have a damaging impact on employment,” he said. “No government, even during times of the strongest economic growth, can prevent every job loss. Unemployment has risen in the UK and will keep rising for some time."

However, Darling maintained that the unemployment rate, currently at 7.8%, was lower than forecasts at the start of the downturn - and added this was due to measures taken by the government.

As the recession hit the country, £3 billion was pumped into helping people find new work quicker. In April’s Budget, measures were announced to expand JobCentre Plus and offer training and volunteering opportunities to those out of work for longer than 12 months.

Now, the chancellor has brought forward the young person’s guarantee, meaning that from the beginning of January 2010 all 18-24 year olds will be guaranteed a job, work placement or work-related skills training six months after their first JobSeeker’s Allowance claim.

Finally, individuals over the state pension age will be supported in their wish to continue working after retirement. From April 2011, people aged 65 and over will qualify for working tax credit if they work at least 16 hours a week rather than the current level of 30 hours.

The chancellor linked the successful tackling of unemployment with the aversion of repossessions. At the beginning of the year the Council for Mortgage Lenders predicted there would be 75,000 repossessions but now expects to end the year at the lower level of 48,000.

Through the mortgage support scheme, announced by Gordon Brown in November 2008, 220,000 out-of-work people have been helped to maintain interest payments on their mortgage.

Darling said he planned to extend this scheme for a further six months to ensure the "hundreds of thousands of families" who lost their homes in the recession of the 1990s would not be repeated.

There was disappointment, however, that the stamp duty holiday, due to end on 31 December will not be extended.

Nici Audhlam-Gardiner, director of mortgages at Abbey and Alliance & Leicester, says: "A wider shake-up of the current stamp duty system is long overdue. We would welcome a permanent increase to the nil rate threshold or at the very least, making stamp duty incremental, so it works like income tax."

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