Report of the Head of Economic Growth and Housing
The Cabinet considered the report of the Head of Economic Growth and Housing in relation to the Government’s Kickstart job creation scheme for young benefit claimants.
The Head of Economic Growth and Housing reported that the Government had announced its job creation scheme for workless young people aged 16 – 24 during the summer of 2020, as part of the Plan for Jobs. The new scheme, called Kickstart, would provide wage subsidies to employers that create new work experience placements and forms a key part of the wider response to economic downturn and job losses resulting from the impact of COVID-19. The report detailed how the Kickstart scheme would work and who would be eligible to join the scheme.
Decision Made: That:
(1) the Head of Economic Growth and Housing in consultation with Executive Director of Corporate Resources and Customer Services and associated Cabinet Members be granted delegated authority to enter into a contract with Department for Work and Pensions to act as a Kickstart Jobs Scheme Intermediary body on behalf of local employers, in order to best respond to local demand and maximise opportunities for local residents, be approved; and
(2) the Head of Economic Growth and Housing in consultation with Executive Director of Corporate Resources and Customer Services and associated Cabinet Members be authorised to undertake further work to allow the Council to optimise future opportunities presented by the Scheme as a direct employer of Kickstart jobs, be approved.
Reasons for the Decisions:
Sefton@Work is the Council’s well-known and trusted job brokerage service which has provided quality employment programmes in Sefton for many years. Involvement in the Kickstart Scheme will enable the Council to have assurance that the jobs created for Sefton residents are of good quality and offer possibilities to improve longer term sustainable progression and complementarity with other aspects of the service provision.
There is considerable demand from local companies seeking to enter the scheme who are not large enough to apply themselves directly. Many of these employers have already contacted the Sefton@Work service to request support to be able to create jobs for young people who are unemployed and claiming benefits, primarily Universal Credit. Given the corporate objectives on economic recovery, tackling worklessness and stimulating inclusive growth, this allows the Council to provide a very significant support to our employer base and our young people during very difficult times.
Sefton@Work funds its operations with a combination of external grants and contracts, with some additional Council revenue from the Growth budget. Acting as an intermediary for Kickstart offers the opportunity to generate an element of financial surplus which can potentially reduce the level of future funding requirements from Council budgets. The level of financial surplus for the Council will be a direct correlation with the number of places offered within each employer and each Council department, with £800 being retained for each external place and £500 for each internal place within the Council.
Alternative Options Considered and Rejected:
The alternative option would be for the Council not to be involved in this scheme.
This option was discounted for several reasons:
· Commitment to a job creation / wage subsidy scheme was proposed within the LCR CA Economic Recovery proposals recently submitted to Government and endorsed by Sefton Council. To avoid involvement in the Kickstart scheme, which is the national youth unemployment job creation scheme would be at odds with this endorsement.
· There are clear expectations of the Council to act as a broker in this scheme and an arbiter of quality. To opt not to play this role could potentially expose our young people to low quality provision.
· Youth unemployment in Sefton has climbed to unprecedented levels during the pandemic and the Council and local employers can act on this important issue through this Scheme. In March 2020 there were 1,190 16 -24 claimants looking for work. By August 2020 this number had increased to 2,410, a rise of just over 102%. The current claimant rate for young people is 12.7%, this is more than double the 6.2% rate in March 2020, higher than the north west average and the national average.