Headline-chasing "soft jobs" scheme should not be missed

One Labour scheme suspended by the new Government has been the "Future Jobs Fund" (FJF). Aptly named given it was specifically designed to spend public money on temporary'socially useful' jobs in the public sector today, to give the appearance of action, not create sustainable employment. The future jobs in question then were those of Labour ministers. They and the usual suspects are dismayed.

Happily for the unemployed, on that latter point it failed. Labour's record on youth unemployment is just as bad as their Conservative predecessors, even towards the end of the last boom after a sustained period of job creation in the real economy.

The proposed cost of the FJF was £1bn, and it was a scheme based on a entirely unconvincing piece of spin that the Government could 'guarantee' a job to those out of work for long time. Local Councils and third sector organisations, for example Lincolnshire Dance and the Big Issue, could bid for the services of the long-term unemployed, and receive payments of up to £6,500 for doing so, provided the work was 'additional', would benefit local communities, and had some vague unverifiable connection to long-term employment prospects- which if with the same organisations- would require continued subsidy from those paying taxes in the real economy.

Where the FJF certainly created work was for Council and regional communications teams in Labour heartlands who were able to create expensive mini-sites and blogs to talk about what they were doing temporarily for small numbers of the youth unemployed. Peterborough usefully currently have two FJF vacancies for Careers Advisers- how appropriate.

What is most unforgivably awful about this scheme though is much of what is bad about it mirrors the known worst aspects of the previous New Deal schemes where the long-term unemployed were endlessly recycled through the same training and community chain gangs without developing real skills real employers really want. Most of those 'helped' by the New Deal would have found work anyway. Something highlighted by Reform's Welfare isn't Working report, back in 2007.

What worked best about the New Deal, was where it linked up the unemployed with relevant real work opportunities. An entirely subsidised job that couldn't exist without the scheme, however 'socially useful', is not that.

There is though a superficial appeal in schemes that pay employers of any stripe to take on the unemployed. If for example unemployment really does cost £8,000 per person a year or more, that appears to be saving money.

But what this tends to do is get the government to either subsidise jobs employers would pay for anyhow (therefore costing more). Or create perverse incentives, like the FJF, for employers to manufacture jobs they can't otherwise justify purely to get the incentive. Further where the job is real, making it only available to the long-term unemployed may mean it is denied to the recently unemployed or new entrants.

With the FJF and New Deal then the unemployed and the money slosh about, with much wasted on administration and promotion.

Welfare to work, decentralisation of budgets, reducing poverty traps, and smaller incentives for agencies to place recruits like recruitment consultants, are welcome proposed changes to the system.

The FJF scheme may return in some form. But if it does it needs to be simpler, targeted on real employment opportunities, and tailored to the individual needs of the person it is designed to help not a generic target designed for headlines.