Writing in today's Sunday Times, Chris Grayling criticises the government's record and sets out some of the measures the Conservatives would take to encourage those who lose their jobs to start businesses of their own. The benefit would extend beyond them - the overall economy could be lifted with an "army of entrepreneurs". In the key paragraphs on the Conservative proposals, Grayling writes:
"We want a programme that empowers an army of “job makers” for the future, that helps create 20,000 new businesses a year and with them many thousands more new jobs.
"The programme would help people who have been made redundant and have been out of work for six months and have a clear idea for a business. They would get Dragons’ Den-style support from private sector specialists, helping assess ideas, offering advice on market research, business planning and how to get things going. Those specialists would be paid for that support when the business was established and the claimant was no longer dependent on benefits.
"The entrepreneurs would continue to receive jobseeker’s allowance for up to six months while getting their business off the ground. It takes that long to do your first deal and get the money paid.
"Every business start-up has a cost, and if you’re on the dole you can’t easily afford to buy basic equipment. At the moment the only start-up cash available from the “new deal” for unemployed people trying to start a business is £400. We don’t think that’s nearly enough, so we’ll give the business start-up specialists the ability to fund costs of up to £2,500, and then reclaim the money from the benefits saved once the business is up and running."
Dragon's Den is an excellent programme.
It is one of the very few genuinely inspiring programmes. The only other one I can think of is University Challenge, though since that's the only one I watch you're probably best not asking me.
The dragons offer constructive advice. They may seem harsh to some, but it's harsh in my opinion to let people waste their lives on projects that are never going to work. The parctical support they offer is more important than the money in general.
At a time when people are watching puerile celebrity rubbish, & their only aspiration in life revolves around that sort of idiocy, this sort of thing is very valuable. If only there were a programme celebrating scientific researchers, authors, & other people who are driving humanity forward.
I agree with Grayling that SMEs are the motor of the economy. New Labour's problem was to base everything around large corporations, the City, house prices & debt. That is not acceptable, & it will hopefully be realised over the next 10 years that large corporations & large bureaucracies have more similarities than differences & should be opposed alike.
I don't especially like libertarians or their ism, but hopefully they & other Tories will come to realise this. Grayling doesn't say whether this scheme should be voluntary or compulsory: in my humble opinion it should be voluntary as some people are in no position to take advantage of it & would only be wasting everyone's effort.
I was once unemployed for 4 months, & the Job Centre is quite staggeringly unfit for purpose. It is inflexible & humanity is firmly barred from entering its doors, as many DWP advisers would only be too happy to tell you in their unbuttoned moments.
They should give every new claimant information about entrepeneurship & work in the voluntary sector. At this time, many Citizens' Advice Bureaux are needing staff, & there should be some way to ensure that anyone who volunteers there & works to managers' satisfaction is not obliged to look for a paid job & perhaps can be paid additional benefits.
People who are unemployed shouldn't be vilified as theirs is an extremely harsh lot, but it can be made easier, & with the right support they can be freed from this terrible dependency on benefits.
Posted by: asquith | October 26, 2008 at 13:40
Absolutely going in the right direction.
IR35 blew a massive hole in the UK's flexible workforce of self-employed IT workers.
As well as the direct consequences on IT work, a whole army of people who were running their own small businesses and could have grown/developed them into bigger businesses were pushed back into the mainstream workforce.
The governments efforts to support new small businesses are a joke - an excuse to give back-handers to the people they like to run courses and give advice of no practical value.
And bring back something like 'individual learning accounts' to support life-long learning, re-training, professional development etc.
Over the past decade the have been one or two good ideas from government -- but even those have been so badly executed as to be useless...
Something has to be done with the lazy and unmotivated, but don't let them drag down the go-getters, so none of this should be compulsory -- just put the tools in place for those who are suitably motivated to take advantage of without being swamped by dont-wannabe's.
And don't let it turn out like the current 'publicish/privatish' organisations that we currently have to support new 'local businesses' -- as well as being useless they compete unfairly with genuine private sector businesses.
Posted by: pp | October 26, 2008 at 14:59
This proposal sounds very promising and encourages the entreprenurial spirit. Could this also be extended to those who are long-term unemployed but are motivated and would like to have a go at, say, setting up their own cleaning or childminding services etc?
Posted by: Tony Makara | October 26, 2008 at 15:44
The first thing would be simplify the processes of running a business. The hoops that some types of industry is shocking. Get the BSU process right and this could be a winner.
Job Centres are more like Joke Shops, staff talking and laughing amongst themselves, only to then put on their authoritive face, when having to greet "their clientele"
It stinks if you have to wittness it, compassion and this governments deptartments aren't natural bed-fellows.
Posted by: Alan Phillips | October 26, 2008 at 17:14
I've been trying to start up a small business using eBay as a basis for trading so I know how hard it is to do it legitimately and I would value the help that this agency would give me. This is a good idea but it needs far more backing from a more robust policy in general towards unemployment and job creation than the Tories realise.
What about the current climate when the economic downturn might make it difficult for things like this to get started. And the money this would cost for probably only a handful of people would mean that some of the attempts to reduce public sector waste would be stymied.
I'd like to see more ideas from the Tories that don't involve micro-management or trying to massage the unemployment figures without doing something for the vast numbers of people who are unemployed and can't get training or experience in normal jobs or professions without expensive year-long courses or other schemes which ignore the reality of being unemployed. This is good but it needs to be coupled with "joined up thinking" on how to get people back to work en masse and with a universalised scheme. Job Centres are horrific places who tend just to write the long-term unemployed off rather than actively help them, but the economy and unemployment services have to be directed at the many, not the few. Sorry if that sounds like Labour policy-making but this is just a drop in the ocean and would only benefit a very few people.
Posted by: Louise | October 26, 2008 at 17:55
Louise, you raise interesting points. Those that are long-term unemployed should be allowed to study full-time vocational courses at college and elsewhere while being able to draw benefit. This, of course should only apply to those who are serious about re-training and they would be expected to attend college regularly. There is clearly a link between unskilled and unemployed and clearly no training pathway available that leads to a recognized certification.
There was a story of a young unemployed girl who was training to be a hairdresser by attending college for 16 hours a week, but was then literally 'forced' to leave college halfway through her course and take up a New Deal work-experience placement for 13 weeks which involved stocking shelves in a supermarket and had no job at the end of the placement. So, the girl lost her place on the hairdessing course and remained unemployed. If the girl had been left alone and allowed to study, she would no doubt have found employment easily once qualified. This is the bizarre way that the Labour government rewards young people who show initiative and want to re-train.
Those with the will to learn a skill at college should be allowed to draw a new training benefit instead of JSA and they should not be pulled off their course to attend dead-end work-experience programmes.
Posted by: Tony Makara | October 26, 2008 at 18:56
Yes, there should be exemptions from the New Deal for those who do voluntary work or some kind of training that will be more useful than stacking shelves.
What worries me is the potential abuse by people claiming to be "students" whilst actually doing nothing.
But surely there could be some way for the organisations they study/work for to verify to the Job Centre what they are doing, & have it accepted if it is valid? All you need is humanity & a bit of flexibility.
Regrettably, the DWP is bereft of these qualities, which is why any worthwhile scheme may get sunk: that, & the untold damage the Scum & the Daily Hate Mail wreak with their attitudes.
Posted by: asquith | October 26, 2008 at 19:18
These plans are good and are supported by the plan to give failing businesses more help. I wonder if they were thought up at the same time and the announcements staggered to prevent Labour theft?
A very good plan anyway, and as someone who would very much like to set up my own company very encouraging news.
Posted by: Andrew S | October 26, 2008 at 20:55
Up to £2.5k of taxpayers' money for each crackpot idea? The big difference is that the Dragon's Den panel members spend their own money, not that stolen from you and me. This is a recipe for fraud and just another idiotic gimmick from the biggest ego in the Shadow Cabinet!
Posted by: Libertarian | October 26, 2008 at 21:39
How about this for a radical idea?
Legalise the so-called black economy.
Have a new benefit called "Entrepreneurial Allowance" which would provide a basic allowance for people to feed their family, etc.
But the person on EA would be expected to run a business on the side.
The typical jobs that people do are helping to deliver papers once a week, do a bit of work for a mate (covering his shop when he goes on holiday), doing the odd car boot sale, that kind of thing.
What would be the benefit to the community of this?
People would be able to spend the money they earn. Buy the wife a nicer gift, get the kids something nice, buy something a bit better for Sunday lunch than an Iceland £1.00 special.
This would mean more money in the tills of local shops. It would also vastly reduce government spending as the new system would improve recycling (more stuff sold on car boot sales rather than being thrown out) and it would slash to next-to-nothing the vast amount of money presently spent on policing the benefits system.
"This man made £10.00 last week, helping deliver newspapers. Let's suspend his benefits for a month, whilst we investigate this, even though he reported the matter to us, himself."
But people who wanted to do more would be able to tap into the idea of Chris Grayling.
For example, don't just walk round distributing a few leaflets. Buy a van and set up a delivery firm. And so forth.
Posted by: Martin | October 26, 2008 at 23:10
I'm not sure about this particular scheme,
but
Asquith made some very good points.
Posted by: Joe James B | October 26, 2008 at 23:24
On the matter of letting people claim benefits while training at college. Obviously this couldn't be an automatic right as such, but each individual would have to apply to the local jobcentreplus office who would then assess whether the person is serious about re-training and had a clear idea as to the course they wanted to study. Should the case be judged as valid the jobcentreplus office could then allow the person to study full-time and claim benefits, which should be payed at the same rate as JSA. Continued payment of the said benefit would of course depend on attendance at the college or other place of learning with periods of absence covered by sick notes in the usual way.
It is a method to get people training and participating in a structured lifestyle without adding any extra cost to the overall benefit claim. People would leave the course after eight months qualified and with a realistic chance of finding work because of their new skills. Something they are not getting currently under Labour's failed flagship New Deal scheme.
Posted by: Tony Makara | October 27, 2008 at 06:52
But this already exists.
I know that Inbiz.co.uk, a government subcontractor, has been the specialist in providing exactly this kind of service to help the unemployed start their own businesses for a few years now.
The Tories really need to do a bit of research.
Posted by: GB£.com | October 27, 2008 at 07:31
GB£ is right. Inbiz is not the only existing state service of this sort. Each of the Regional Development Agencies and organisations like Business Links do something similar. They don't work particularly well.
Posted by: Angelo Basu | October 27, 2008 at 16:30
I have just looked at Inbiz. It covers only a very small part of the country. And the regional service in the West Midlands seems sporadic.
We DO need a genuinely radical approach.
Posted by: Martin | October 27, 2008 at 23:44