This is not a reflection on the recent budget, we’ll all have our opinions, worries and things we welcome.
The White Paper a year ago set out some great reforms and principles which I was very pleased to see, it reminded me of when I worked in local government in Knowsley, to be honest I was hoping to see a rerun of something like Neighbourhood Renewal Fund. We also had ESF, the New Deals, and we hadn’t had 14 years of austerity. Even then, our Local Area Agreement (remember them!) had to be negotiated down, to a 70% employment rate target. We started to get close, our rate of improvement was among the best in the northwest, we had a plan, and we were focussing on economic inactivity, termed worklessness then.
Today, we can see some of the White Paper reforms coming through, investment in the Youth Guarantee and free apprenticeship training for SMEs to hire young apprentices – although as a small business we have never paid more than £500 for a level 3 apprenticeship, it is already subsidised. In both cases they were young but not under 21, so this isn’t a game changer and wouldn’t make our company hire someone under 21 for that reason alone.
But, if the OBR analysis of Pathways to Work shows only a modest impact on employment and Connect to Work is more targeted than the provision that currently exists, and IPS is for those with severe mental illness or substance dependency.
What about everyone else?
Most people we support we find, one person at a time, by being in community settings and neighbourhoods where economic inactivity rates are high. This takes staff resource, we find the people, build trust, and take incremental steps towards achieving training, volunteering or job goals. They are not being referred to us by the Job Centres, because they won’t have a UC claim that requires them to look for work. We meet people who are experiencing severe mental illness, but more often they are experiencing multiple health barriers, learning English to a level where employers could employ them, living in poverty and dealing with all the turmoil and anxiety that can create.
Similarly, in the social housing neighbourhoods we work in the people have multiple disadvantages, due in part to where they live:
- a disabled person is 8 x more likely to be unemployed than someone who is not disabled.
- a social housing tenant is 4 x more likely to be out of work than those living in other tenures.
- 30% of the households claim out of work benefits compared to 10% not in social housing.
- most residents do not receive back-to-work or in-work support through government programmes.
- working housing association residents earn c 50% of owner occupiers; and they are far more likely to be ‘economically inactive’ than those in other tenures.
Worryingly, UKSPF which funds a lot of this across the UK will end in March 2026, with no word from the Government about a replacement. This will mean maybe 30 or more small organisations in Liverpool City Region will stop supporting economically inactive people, as well as most of the Council’s in-house teams, who will switch focus to Connect to Work.
Let’s not forget, pre-Brexit, ESF (2007 and 2020 with match funding) was in the region of £17 BILLION. Crucially, it was spent on employment support, education, and training programs, primarily targeting disadvantaged groups and regions like Liverpool would be allocated more proportionately based on disadvantage. Post Brexit, UKSPF was far from a full replacement, and further cut last year.
So, where has all the money gone? How much of it will appear in the local settlements and sit with the Mayors? When will we know? I am told February 2026, a month before UKSPF ends, by which time a lot of employability staff are bound to be on notice across the UK. We will do all we can to protect our work and impact with the incredible staff we have.
We need to maintain if not expand support for these groups, not have it at risk. Without this, there’s isn’t a cat in hells chance of hitting the employment rate target of 80%. I remain hopeful and welcome the new Local Growth Plans and resourcing behind the Regions, to deliver their Get Britain Working Plans, and hope very much it will reboot efforts beyond 2026 and into the longer term.
Sadly, if this isn’t the case, the deeper impact will be bad news for people who need support the most. And this will show up in the statistics, as never achieving 80% employment.