Official Report: Minutes of Evidence

The Chairperson (Mr Swann): I welcome Ms Yvonne Croskery, director of the youth policy and strategy division, and Mr Philip Rodgers, head of the apprenticeships and economic inactivity section.

Ms Yvonne Croskery (Department for Employment and Learning): Good morning.

The Chairperson (Mr Swann): Good morning, Yvonne and Philip. Philip, I think that this is your first time before the Committee.

Mr Philip Rodgers (Department for Employment and Learning): It is. I joined the Department only a week ago, so go easy on me.

The Chairperson (Mr Swann): And they sent you here. We do not go easy on anybody unless we have to.

Ms Croskery: He has had quite a bit of experience in economic inactivity, I have to say.

Mr P Rodgers: I came from DETI, and obviously this is a joint project between the two Departments.

The Chairperson (Mr Swann): Yvonne, please give us a briefing of no more than 10 minutes.

Ms Croskery: If it is OK with you, Chair, I would like to start by updating you on progress made since we last met on 28 May, when we gave a detailed briefing on economic inactivity. Since then, Departments have undertaken considerable progress to inform the development of the final strategy. I thought that it might be helpful to brief the members and outline the additional work that has been undertaken since May and then to talk through the development process since we last met.

In response to the consultation, a number of key work streams have been taken forward across a number of the Departments. I will quickly run through those. A major research project has been commissioned to provide a comprehensive audit of our existing service provision for the economically inactive in Northern Ireland. We are currently working through options to inform delivery mechanisms. We are engaged in benefit mapping to inform potential localised solutions to inactivity in different geographical areas. I remember that we spoke about that the last time we were before the Committee. We are working on employer subsidy options and are looking at social clauses to provide more employment opportunities and at options for further pilot project testing using the Small Business Research Initiative's pre-commercial procurement. We are also working on transitional benefit protection to encourage labour market participation from the target inactive groups. We have also undertaken scoping work to inform the expert panel that we are looking to establish to better integrate health and work services in Northern Ireland.

If members are agreeable, I would now like to spend a wee bit of time on the development process over the last few months. We had meetings with the business sector back on 17 June. The Ministers of our own Department, DETI, and DSD jointly hosted an event in Parliament Buildings. I have to say that, from the consultation process, that was well received, and we had positive feedback. We were very encouraged by small to medium-sized enterprises (SMEs) about the delivery of the strategy and our thinking to date. However, they indicated that the primary focus should be on training and upskilling individuals to, obviously, meet the needs of the economy as well.

They also highlighted the need for a strong focus on structural reforms to support the efforts that we will be going forward with to improve and simplify employer/government relationships. We were with the Enterprise, Trade and Investment Committee on 19 June to update it on the public consultation findings. That Committee noted that. We published our summary responses in July, and they are on both Departments' websites. We have electronic copies of those as well.

In July, we tabled a joint paper to update the Executive subcommittee on the economy, and it endorsed in full the proposals that we put forward, essentially classifying the summary of the responses to the public consultation into three groups: the proposals that should be in the final draft strategy; those that require further consideration; and new thinking on some of what we are bringing forward. The subcommittee also agreed to three specific proposals. The first was to agree terms of reference and to commission a comprehensive audit of existing provision for the economically inactive. The subcommittee was very keen that we did that. Secondly, it agreed to consider the structure, terms of reference and membership of the strategic task force; and, thirdly, to consider the formation of the expert panel.

I am mindful of time and am trying to run through this as quickly as possible.

We have an interdepartmental working group taking forward projects around cross-departmental development of the final strategy. We will go over that in a wee bit more detail as we enter into the discussion and questions.

We have budgeted for £1 million next year to support incentives and how we might go forward with the strategy and its implementation. We intend to submit final strategy proposals to the Minister of Enterprise, Trade and Investment and the Minister for Employment and Learning for consideration at the end of the year — around December or in early January.

Without further ado, Chair, we are happy to take questions. We can, if you like, talk about some of the subgroups. Can we, Phil? We will have a run-through. It will be helpful to do that.

Mr P Rodgers: On some of the specific projects, yes, if that will be useful. The main one that is progressing is the work that we are doing through the business consultancy service (BCS) in DFP to map existing provision. We have developed a template for Departments to complete that will hopefully give us an indication of the various programmes and initiatives and of how much money is being spent on targeting the economically inactive to try to get them back to work.

As members will appreciate, DEL has a role through its employment service. DSD does a lot of work in the area, as does DOJ with offenders and young offenders. There is also DHSSPS, of course, which is trying to deal with health problems around economic inactivity. Therefore, a wide range of work is done by Departments. We are trying to map that and get a better handle on what is being spent and how.

Early indications are that a lot of things are being done, with Departments fishing in almost the same pool. This will let us see where there might be an opportunity to do things better and more efficiently and perhaps to get Departments working together a bit better.

Members will recall that one of the high-level proposals in the consultation document published in January was that we would bring together a strategic forum to drive it and that we would hold Departments to account on implementation. We have been giving thought to that and fuller details of that will be in the final strategy when we go to Ministers towards the end of the year.

Another key aspect, and one that was welcomed, certainly in the consultation, is around the idea of innovative pilots and pre-commercial procurement. I know that Mr Ramsey was keen on that with my previous Minister. He met Minister Foster a number of times about that.

We have been thinking about how we can put in place a process to move forward with a number of the ideas. We have been giving some thought to how we go about developing an outcome specification for that piece of work. We have talked to people across the water in Nesta and the Cabinet Office who are a bit more expert in the field about how we can develop a co-design process, through which you get people whom you are targeting, as well as groups, individuals and the organisations active in the field.

The aim is to work together to design an outcome — what we want to get out of the process. We hope to be able to say a bit more about that in the final strategy. We hope to make some moves to bring people together to discuss outcome specifications in the new year.

We are grappling with how to assess the pilot projects when we develop them. The process will be that we will have a call for proposals. We will then make money available to groups that want to develop initiatives, with perhaps a small amount of money made available to develop their ideas to proof-of-concept stage. We will then take time to consider the proposals and perhaps pick 10 or 12, or whatever number, that we will go into full pilot testing with.

The difficulty that we are grappling with is that we want to do this quickly. However, if we are talking about creating opportunities and getting the inactive into sustainable employment, which means being in employment for a considerable period, the issue is how we marry those contrasts. We, or rather our colleagues in DSD, have been doing some work on benefit mapping and on trying to see where the inactive are concentrated so that we can look to bring forward some of our pilot projects that could be geographically specific. Again, that work is ongoing in DSD, and we have not seen the results of that yet.

That is just a rattle-through of some of the higher-level projects that we have been taking forward.

Ms Croskery: We are very excited about the mapping project, in that we believe that it will bring together all the different interventions across government. We can take a really good look at that, and the challenge will be to make sure that we are using that to its best effect. Moreover, we are looking at a strategic approach so that we are all joined up. Where we have good practice, we are taking that on board as well.

The Chairperson (Mr Swann): Thanks, Yvonne and Philip. How long will the mapping project that you are doing across Departments take?

Ms Croskery: We anticipate the results being back at the end of November. It is under way at the moment. It is a good process that has been developed by the business consultancy service, and it has been simplified. We did a dry run to test the ability to fill out the data that we are seeking, and we are relatively confident that we will have the results of that back for the end of November.

Mr P Rodgers: The template that the business consultancy service has developed is with Departments at the minute. We are expecting to have the results back with BCS in mid-November, and it will then take time to analyse those. As Yvonne said, we hope to have a report by the end of November.

The Chairperson (Mr Swann): Do you honestly believe that, if you find somewhere where another Department is duplicating the same service, it will surrender that service to DEL?

Ms Croskery: In this economic climate, we all need to be looking innovatively at how we best use our money. There is an appetite across the table and across all our partners in this project to use it to its best effect, which is ultimately for the citizens. I think that we will be pushing on an open door.

Mr P Rodgers: It is not necessarily the case that Departments would surrender the money to DEL. It is more the case that the strategic forum that we put in place would be able to guide Departments on how they use their money to better effect so that each Department is not doing the same thing.

Ms Croskery: We want to see joined-up government, in which all our interventions in the strategy work together. We are not so precious about who owns the money. Strategically, we want to look at how we use it to its best effect.

The Chairperson (Mr Swann): To reverse my question, if you saw that another Department was duplicating something that DEL is doing, would you surrender that service to it?

Ms Croskery: We would be having conversations about who is best placed to do it.

The Chairperson (Mr Swann): We would talk for a long time about it.

Ms Croskery: No, I do not think that we would be talking for a long time about it, because we are in very challenging circumstances. I think that we will be having open and honest conversations. However, from DEL's perspective, we do not want to pay for something that someone else is doing, and doing very well, or vice versa.

The Chairperson (Mr Swann): I am thinking of the amount of duplication that there was in the careers inquiry from different bodies on a simple thing such as careers advice to students. No matter what work the Committee did and what recommendations it put forward, there is still a silo mentality, and neither DE, DEL, careers information nor schools will give up their wee bit.

Ms Croskery: There is not that mentality with us. You can see that we have brought quite senior people from right across government to the table because we really want to crack the issue of economic inactivity, and we cannot do that ourselves. I, for one, from DEL's perspective, think that, if we find somebody is doing something exactly the same as we are doing, we will have to have a conversation about who does what.

The Chairperson (Mr Swann): I appreciate that. I am challenging you. I am not saying that you will not do it; rather, I hope that you can do it.

Quite a lot has been made of the fact that our unemployment rate is now at 6·1%. We are just above the UK average. In the same report, which is on labour market information of the UK regions between June and August, the employment rate in Northern Ireland was 68·3%, which is the lowest in the UK. That is not something to be proud of. Our economic inactivity rate is 27·2%, the highest in the UK, which is again not something to be proud of.

Ms Croskery: It is. In all the regions.

The Chairperson (Mr Swann): I am not sure that it is all right to grab the headline that our unemployment is nearing the national average when the other two figures are the worst across the regions. Are your strategies tackling that or are we talking about strategies for strategies' sake, hoping that, somewhere down the line, something is going to happen?

Ms Croskery: We will be driven by meaningful targets to reduce economic inactivity. That is the purpose of the strategy, and, when we go forward with the two Ministers, we will be charged with delivering on that strategy and with having an impact on the very figures that you have just quoted. That is what we are about. We have three target groups that we will be looking at in the strategy, including the disabled. Phil, do you want to come in?

Mr P Rodgers: The three target groups that were identified in the initial consultation are the long-term sick, those with disabilities and those with caring commitments. The inactive group is quite diverse. It includes students. We do not necessarily want to move students, as they out there getting skills and learning.

The Chairperson (Mr Swann): The Department will move them by cutting higher education (HE) funding. The universities will cut their numbers of students.

Mr P Rodgers: One of the challenges that people put back to us in the consultation was our suggestion that the objective should be to increase the employment rate, and we put a figure of 70% in the consultation. That sort of means that we cannot reduce inactivity by moving people into the unemployment register. We have to get people into work.

Ms Croskery: Sustainable work. We will be working on the definition of that as well. That is another challenge for the group.

Mr P Rodgers: One of the things that people put back to us was whether 70% is a sufficiently stretching target. As you said, it is 68·3% at the minute. We are not talking about a big jump to get to 70% by 2023. That is something that, in the final strategy, Ministers will be pushing us on, and I suspect that this Committee and the Committee for Enterprise, Trade and Investment will also be pushing us to get a really stretching target or objective around the employment rate.

The Chairperson (Mr Swann): The target is 70%.

Mr P Rodgers: That is what we suggested in the consultation. People said that, yes, we need to address the employment rate, because that meant that we could not shift people from inactivity into unemployment and meet our objectives. People were clear that that was the right metric. They thought that we could be a bit more stretching with the number and could go from 70% to 72% or 73%. I think that 73% is approximately where the UK is at at the minute compared with roughly 68% in Northern Ireland.

The Chairperson (Mr Swann): Even achieving 70%, which you said is an ambitious target, would still leave us the fourth lowest of 14 regions across the UK. It is not pushing us up there. Do you have an economic inactivity target? Do you have a percentage set for that?

Mr P Rodgers: We do not have a target per se. We targeted two groups: the economically inactive owing to their caring responsibilities and those who were inactive because of long-term sickness or disability. To get to a 70% employment rate target, we estimate that about 30,000 people from those two groups would need to move into employment. We do not have a specific target yet, but we can certainly work through that as we develop the final strategy.

Mr P Ramsey: Good morning, Yvonne. Good luck, Philip, in your new job. It is a very worthwhile strategy, and I have been working with both Ministers on trying to work on a specific project in Derry — sorry, not so much Derry as the north-west area and Strabane.

Can you outline to us at this stage what the budget will be like for the development of the strategy?

Ms Croskery: As I shared with the Committee earlier, we have bid for £1 million for next year. The Department is looking at its budget for next year, and I think that the Executive are going forward with our proposed plan for 2015-16, as I understand it, for the end of October. That is as far as I can give a commitment at the minute. You can understand that, on behalf of the division, I bid among other bidders. Hopefully we will know more soon. That having been said, Pat, with the mapping exercise, we will have quite a good idea of how much we are spending right across Departments on that issue. We need to think about that as well. We already know that a considerable number of Departments are doing different activities and mapping for the inactive right across Northern Ireland, and that information will help guide us on what money will be available. For the purpose of the pilots for next year, we have bid for £1 million.

Mr P Ramsey: Is that £1 million for one project or 12?

Ms Croskery: We see it being for a small number of projects, but we do not want to commit to an exact number. We are looking at a co-design-type process and really looking at innovation, Pat. It will be as many as we are convinced will work through co-design and working with the target groups, because they have to have a voice in this, too. If we work at that level, through co-design, we hope to get new, innovative ways of helping people and really listen to how we can help them into sustainable employment. We will include the very things that the SMEs told us about skills and upskilling people as well. It is a big challenge. It is not a nut that we will crack overnight. There is no doubt about that.

Mr P Ramsey: I agree. There is a big challenge here.

The Chair said that economic inactivity here is at around 27% and, in the north-west, it is way over 30%. It is a big hotspot. One would envisage that, although you are going to have a project-driven process, presumably it will be programme-led as well to ensure that the hotspots will be focused on and that the localised, customised, tailored —

Ms Croskery: It will be geographically-based as well. We have already accepted, as part of our work going forward, that it needs to be and that one size will not fit all. There will be different issues in different areas of Northern Ireland, and we will need very different, innovative approaches.

Mr P Rodgers: That links to the DSD project that I spoke a little about, in which it is trying to map for us where people are based so that we can identify those hotspots. That will mean that, when we come out looking for pilot proposals, we can target particular areas.

Mr P Ramsey: Chair, if I can this share with you, I chaired a stakeholder event, at my asking, and held several other meetings involving the North West Regional College (NWRC), Derry City Council, Strabane District Council — there is clearly an economic unit there — and the Western Health and Social Care Trust. The first thing that the Western Trust said at the meeting was that it wanted to be part of the economic inactivity project but that it had no money to put on the table. I say that in reference to your earlier question. The Chamber of Commerce was also involved in that, and we are ready with a project. A lot of work has been put into it, such as occupational therapy from the Altnagelvin end of things. Given that the north-west is ready, what is the time frame?

Ms Croskery: That is very encouraging to hear.

As I said, we hope to be in a position to know our exact budget at the end of October. We are working to go to the two Ministers and would hope to start taking things forward early in the new year, while looking at encouraging co-design through this new, innovate design approach. I think therefore that it should be early January.

Mr P Rodgers: In the new year, we hope to be in a position in which we will be able to go out with calls for proposals.

Mr P Ramsey: I have a separate question before I finish.

Philip, you obviously have a key role to play in apprenticeships and economic inactivity. I read online last night about the targets that Scotland has for disabled people coming in and working through the apprenticeship model, either at the normal apprenticeship level or at the senior level that Scotland is marketing as well. What are your targets for disabled people in apprenticeship positions?

Ms Croskery: I will take that point, if I may. We are charged with going forward with a new model of apprenticeship from 2016 and with piloting new and innovative approaches. I do not have figures with me today for the current ApprenticeshipsNI scheme, but we do have a range of additional supports to encourage disabled apprentices. However, I do not know whether we have a target at the minute.

Mr P Ramsey: You might think about having one now.

Ms Croskery: We will check on that and get back to you, if we may.

Mr P Rodgers: As Yvonne said, our role is to put in place the new system that will begin in 2016. One of the key projects that we are taking forward as part of that will be a widening participation project, which will look at widening participation to the disabled and other section 75 groups and at ensuring that there is balance across various groups so that certain apprenticeships are not seen as male apprenticeships or female apprenticeships.

Ms Croskery: They are accessible to the disabled. That is one specific bespoke project that we are bringing forward as part of the implementation of the apprenticeships review.

Ms McGahan: Thank you for your presentation. I appreciate that you are trying. Sometimes I feel as though we are going around in circles. The argument out there is that we have an increasing number of highly skilled individuals who are filling jobs that are deemed low skill/no qualifications, thereby reducing the opportunities for people at Key Skills level 2 or below to try to get a foot into the labour market. I note that we have correspondence from a trailer company stating that it could employ 20 people with immediate effect, but skills and training are big issues. Like I said, we are going around in circles. There are job opportunities, but we have a skills mismatch.

Regarding job creation, which is to reduce economic inactivity, can you elaborate a wee bit more on the promotion of self-employment opportunities and support that you are going to give further consideration to?

Mr P Rodgers: Yes, certainly. A key aspect that Invest NI takes forward as part of the work on economic inactivity is in the area of self-employment. I suppose that we always think about getting people into jobs, but Invest NI is clear that its key focus is helping people into self-employment as well and that being seen as a viable option.

Ms McGahan: I do not live too far up the road. The area is a hub for manufacturing and engineering. If you go up any back lane, you will see an entrepreneur. Self-employment is important for rural areas because we do not have a lot of public sector jobs west of the Bann. Most people have to travel to Belfast. That is an important focus, especially for rural areas.

Ms Croskery: As part of this, there is scope for us to signpost and direct to Invest NI and to look at where there are opportunities that could utilise the support that is available. We will need to be thinking about being proactive in helping people to start their own businesses, how they would go about that and what assistance is available.

Ms McGahan: Engagement with local enterprise centres would be important, because they are local, so they know the difficulties in an area.

Mr P Rodgers: Of course, local councils are getting more powers around start-up business programmes.

Ms Croskery: We would be keen to listen if your trailer company would like to talk to us about apprentices. Is it a possibility that we could get home-grown talent to go into those companies, learn the job and get the skills they want? That is a wonderful opportunity.

Ms McGahan: I assume that the Committee will be following up on that.

Mr F McCann: Some of the questions that I was going to ask have been asked. I say that every week because of the habit of putting my hand up late.

You are welcome, and thanks for the presentation. I am a bit cynical about consultations. From going through the list, I see that you end up with the usual suspects. I take it that there is a wider list of people that you asked to participate but at some stage there is a need to go out to consultation much further.

I am glad to see that some partnership boards, certainly in Belfast, have taken part. We all need to encourage the voluntary and community sector, which works at the coalface, to participate. There needs to be a way to get to those groups, because that is where you will pick up on the real difficulties and problems that exist, especially in and around NEETs and unemployment.

The hidden aspect to economic inactivity and unemployment in the North is that we are a low-pay economy. Many who are self-employed work only one or two days a week and rely on benefits although they are classed as being employed. Is there any way that we can get a flavour of how that is broken down?

Bronwyn and I were speaking last week, and she talked favourably about self-employment, but there is another side to self-employment, with people relying on benefits to supplement the money that they earn. On the one hand, they are classed as being employed, but, on the other hand, they rely on benefits to survive.

Ms Croskery: Technically, there are very strict rules around claiming benefits and working over 16 hours. I do not have figures to hand, Phil, unless you are aware of any that would capture that.

Mr P Rodgers: No, but I can certainly have a look at some of the numbers around that idea of almost underemployment.

Ms Croskery: Or partial employment.

Mr P Rodgers: Thinking back to my previous role in DETI, I recall that the economic strategy that Minister Farry, Minister Foster and the Executive subcommittee on the economy developed is all about trying to move us to a situation in which we are creating higher-paid jobs and addressing some of the issues, and the economic inactivity strategy is a key pillar of supporting what we collectively are trying to do to move Northern Ireland forward.

Like anything, it takes time. The global economic challenges that we face need to be addressed, but the Executive subcommittee has always been clear that it has put the template out there but that it is now up to us to deliver.

Ms Croskery: We have opportunities to offer upskilling through this. It is not just about putting people into the first job. We have been listening to the voices of the SMEs throughout our engagement. We need to think about that as well.

Mr P Rodgers: One of the interesting points about the economically inactive groups is often missed. Those with caring commitments actually have better skills than the general population. Therefore, it is not necessarily a skills issue for them. It is more about alternative caring arrangements and access to opportunities, or perhaps even confidence if they have been out of the labour market for a while. Skills or qualifications are not such a big problem for that group. Perhaps they are for the long-term sick and disabled. The issue of why such people are inactive is not the reason that keeps them out of the labour market. That does tend to be because of a skills issue. It is a complex piece of work that we are trying to deliver.

Mr F McCann: It is not part of the general report, but, as the Chair said, there is some optimism in and around the 6·1%. That hides a multitude of sins about types of employment, yet the NISRA figures from the start show that Foyle has an 8·7% claimant count, which is three times the average of some other places. In my constituency of West Belfast, it is 7·5%. In North Belfast, it is 7·5%. Those are twice the average. In West Tyrone, it is 5·8%. Therefore, there is work to be done in there, and there need to be focused approaches taken on how you start to impact on and affect that.

Mr P Rodgers: That is what we are trying to do through the pilot initiatives.

Ms Lo: Philip, you are new to the Department, and I am new to the Committee, so excuse me if I ask stupid questions. You talked about the pilot testing initiative. What is it?

Mr P Rodgers: We are proposing that, when we complete the audit that we are doing at the minute, which we talked about, that will help us identify gaps. We are also doing some other work that will hopefully help us identify, as we say, hotspots of economic inactivity. The approach that we are proposing is that, rather than say, "OK, let us create a big programme to deal with economic activity", we will instead think about it a little bit more innovatively. Therefore, let us put out a call for localised projects that we can test and see what works. We can then perhaps look at how we can upscale the projects or initiatives that are working and delivering what we want, which is sustained employment for the people whom they are working with. It is an approach to test different ideas and new ideas to identify particular issues. It is very much based on an idea that has been used to deal with technological problems, and this is the first time that we have really tried to use it to deal with social issues. We try to identify a handful of projects that look as though they could deliver what we want them to deliver and then test them in the marketplace with real people. If they are successful, we look at how we can upscale them. That is the broad thrust of it.

Ms Lo: Can you give me an example? Is it like a training project?

Mr P Rodgers: It could be.

Ms Croskery: It is open to anybody who can come forward with an innovative way of helping the economically inactive groups to move from where they are.

It is almost like starting co-design with a blank sheet, and the citizens who you want to help are part of that co-design process. We work through it by taking forward concepts in different areas on a small scale to test different ways for the different groups. For example, the disabled may need very different innovative approaches to help them to move into work than someone with a caring responsibility. That offers us opportunities to test, on a small scale, a range of different approaches that we have never tried before.

Ms Lo: So, voluntary organisations and community groups will come forward.

Ms Croskery: It could be the statutory organisations that your colleague talked about, or it could be anyone who can come up with an idea that is innovative, worthy of testing and for the groups that we are looking at. It is also for different areas, because the area that we are in today will need very different approaches from Belfast or Derry, for example.

Mr P Rodgers: The projects that we would most welcome, I think, are the collaborative projects that include perhaps a local health trust, a local training provider or somebody in the community and voluntary sector. It is about organisations coming together and coming up with solutions.

Ms Lo: That is maybe £1 million.

Ms Croskery: Hopefully.

Ms Lo: So you are like a grant scheme for people to set it up.

Mr P Rodgers: There will be some money available to help people to develop their ideas, and some further money will then be available to test them in the marketplace.

Ms Lo: How many projects are you thinking there could be?

Ms Croskery: We do not want to commit to saying that, because we are looking for innovation. It could be four projects or it could be 10 projects. It depends on the quality and the calibre of what is submitted. That is what is innovative about the process. We do not set limits, amounts of money or numbers, because we are all about testing what is new and different and supporting really good ideas, perhaps from small community groups that have never had an opportunity to be in this field before.

Ms Lo: Will you spread it out between the three categories?

Ms Croskery: We will look at the three categories, yes.

Mr P Rodgers: We want to address each category if we can, yes.

The Chairperson (Mr Swann): Yvonne and Philip, thank you very much.