Here’s the link to my Today programme interview on youth jobs, http://tinyurl.com/cr4386k, and below is the transcript
Liam Byrne –Youth Contract
BBC Radio 4 Today
Friday, 25 November 2011
Speakers: Liam Byrne
JH: The government says it’s going to create 400,000 new jobs for young people. The opposition is not impressed. I’m joined by the Shadow Work and pensions Secretary Liam Byrne, good morning to you?
LB: Good morning John.
JH: Why not?
LB: Well look young people are now paying a brutal price for the government’s economic policies. The cancelled the key back to work scheme for young people last year because they said it was, quote, a ‘low value scheme’. Now over the last year we’ve had youth unemployment soar up by a million people and we’ve had long term youth unemployment rise 77% this year. Now we hear today that there’s a back to work scheme very similar it would appear to the scheme we had last year but it’s actually going to be paid for by squeezing working families’ tax credits. So there appears to be this massive sting in the tail.
JH: How would you pay for it?
LB: Well we think the sensible thing to do is to put a fair tax on bankers’ bonuses because that could create a fund of about £2 billion which will help get 100,000 young people back to work this year and I’ve been looking just beyond the headlines at the government’s announcement yesterday which was briefed into the media last night and of course it turns out that this money is going to be spread over three years, there will only be something like 50,000 jobs available over the next year and of course that only helps about 1 in 20 young people who are out of work so we just think that a bigger scheme is needed and we think it should be funded by a tax on bankers’ bonuses rather than a bigger squeeze on people’s tax credits.
JH Right, and that would be the same bankers’ bonus that you’ve committed according to the Prime Minister, you’ve committed to spending nine times already in nine different ways, higher tax credit, child benefit to those on the highest rates, cutting the deficit, spending on public services. How many more times can you use this same bonus tax?
LB: No I wouldn’t really believe Mr Cameron…
JH: Well you don’t have to because I spoke to Ed Balls last week and he said much the same thing, I don’t mean he said the same as the Prime Minister but he gave me different reasons, different ways in which this bankers’ bonus would be used. So you can’t keep reusing it can you?
LB: No we’ve been very clear about what we would spend it on and we’ve been very clear that if you raised a £2 billion fund which by the way is a pretty conservative estimate of what you would get out of a bank bonus tax, actually when we implemented such a tax in government it raised far more than £2 billion…
JH: Alright but let’s assume it’s £2 billion. So because the government’s spending £1 billion on this present scheme, that’s what they tell us anyway, so that would take half of it wouldn’t it. Only you’d be much more ambitious therefore it would take much more than half. Would it use it all up?
LB: Well the government appears to be saying that it would raise £1 billion but over three years and it appears to be saying that it would raise that money and we’d like to hear Nick Clegg confirm this today, saying it would raise that money by squeezing tax credits. Now let’s remember that in April this year the tax credit squeeze for working families is £1.3 billion. That’s nearly five times what was cut from tax credits for working parents last year. So this massive squeeze is coming. And if the government are really saying to us that they’re going to squeeze working families even more to pay for their failures at the last election…
JH: Alright, we can certainly ask him that at ten past eight but what I’m asking you at the moment is how you would raise the money because it would be much more than the £1 billion, you’ve made that perfectly clear, so what are we talking about, a couple of billion in your case?
LB: No let me be clear about our position. We’re saying that we think a bank bonus tax could create a fund of about £2 billion. Of that fund we would earmark about £1 billion for getting young people back to work…
JH: So you’d spend the same amount of money as the government is spending?
LB: In one year, rather than over three years.
JH: One year instead of three years, right?
LB: Exactly. Remember if the government is raising £1 billion and spending that over three years that is only about £330 million a year.
JH: Right. So you would spend £1 billion in the first year and then another billion and another billion?
LB: Well we’d have to see what youth unemployment came down to. We’ve only set out plans for a year because we think the priority frankly is now. Given that the key back to work scheme has been taken out of the market over the last year frankly we’ve now got a youth unemployment crisis on our hands but the government appears to be saying to working people in this country they need to pay the price for that failure. That just simply doesn’t strike us as fair.
JH: Well that isn’t what they’re saying is it? Otherwise Nick Clegg wouldn’t be making this announcement today?
LB: But that’s the substance John of what I think he’s proposing because seriously are you saying that you cancel the scheme that gets young people back to work last year, you then watch youth unemployment go through the roof and then you say to working families in Britain you’ve now got to pick up the tab for that failure? Surely that can’t be right?
JH: And are you really saying that for your billion spent over one year you can get a million kids back in work?
LB: No we said we could get 100,000 young people back into work. And that is a reasonably generous subsidy per young person. One of the other issues that we’re worried about today is that we don’t think the government has earmarked enough for each individual young person. It looks like a back to work scheme on the cheap to us a but like the YTS schemes from the 80s that didn’t fare very well.
JH: Liam Byrne many thanks.