Dáil debates

Tuesday, 9 November 2010

Reform of Structures of Government: Motion

Job Creation

8:00 am

Photo of Lucinda CreightonLucinda Creighton (Dublin South East, Fine Gael)
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The announcement of the labour activation fund was accompanied by great fanfare when it was announced by the Minister last March. At that time we were told it would go a long way towards redressing our grave concerns about the number of people unemployed and in particular, the number of young people who have been forced to join the live register. It was envisaged that this fund would provide myriad schemes to enable young people and others to avail of opportunities for reskilling and upskilling. Unemployment is currently at record levels with more than 450,000 people on the live register, most of whom are young people. The most recent live register figures issued show there has been a slight decline in the number of people signing on. However, we all know through interaction with friends, family and neighbours and in our constituencies, that young people graduating from school and university are opting to leave the country in search of better opportunities overseas.

It is clear that the State needs to take action and this fund was to provide some hope and some significant investment in people who have been unfortunate to find themselves out of work so they will be better placed to gain employment in the future. In response to my recent parliamentary question the Minister confirmed that €32 million has been allocated to the labour market activation fund but to date, only €8.4 million has been drawn down. Considering the urgent need to re-educate people and to retrain and upskill people for economic activities in other sectors which have prospects for the future, this is very disappointing.

In my first parliamentary question to the Minister a number of weeks ago he was unable to give me any figures regarding the number of people who have benefited from the scheme but, miraculously, I have received a reply as a result of tabling this Adjournment matter. However, it is still extremely unclear and I hope the Minister in his response will be able to shed some light on the numbers of people whom it is envisaged will benefit from this scheme, how many have benefited to date and how many have benefited from further education placements and reskilling and retraining.

Photo of Martin ManserghMartin Mansergh (Minister of State with special responsibility for the Arts, Department of Arts, Sport and Tourism; Minister of State with special responsibility for the Office of Public Works, Department of Finance; Tipperary South, Fianna Fail)
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I am taking this Adjournment matter on behalf of my colleague, Deputy Seán Haughey, Minister of State with responsibility for lifelong learning. I thank the Deputy for raising this matter as it gives me the opportunity to outline to the House the position regarding the labour market activation fund.

As part of budget 2010, the Government announced the creation of a €20 million labour market activation fund, intended to deliver 3,500 places on training and education programmes for the unemployed. Its objective is to stimulate innovation in the provision of training and activation measures for jobseekers seeking to upskill and get back into work. The fund is being targeted to specific priority groups among the unemployed - the low skilled, and those formerly employed in declining sectors - construction, retail and manufacturing sectors - with particular emphasis on the under-35s and the long-term unemployed.

In order to leverage to maximum effect the potential of the market for efficient and value-for-money delivery of full-time or part-time education and training provision for the unemployed, an open tender competition was launched in March 2010. Some 370 tenders were received from public, private, voluntary and not-for-profit organisations, demonstrating a level of response and quality of proposals that exceeded the most optimistic expectations. Offers of funding were initially made to 26 organisations. On 5 August, an additional allocation of €12 million was made available by the Department of Education and Skills, enabling funding to be offered to 33 additional projects. This brought total funding to €32 million for 59 projects proposing to provide up to 12,000 education and training places for the unemployed.

The initial phase of the labour market activation fund comprised 26 projects aiming to provide more than 6,500 education and training places in all geographical regions. The successful tenderers for this project were spread among 13 public bodies, eight private training and education providers, and five not-for-profit organisations. Places offered to unemployed people included courses that range from higher education programmes to upskilling courses with accreditation up to level eight available to participants. In the main, these projects are meeting their interim targets. As of mid-October, some 3,441 or 52% of phase one places were already filled, with further courses coming on stream between November 2010 and January 2011. On the basis of current information, it appears that the targets for places to be provided as set out in tenders by projects can largely be met. A total of 33 projects aiming to provide some 5,400 places in all geographic regions benefited from the second tranche of funding allocated in August. Many projects are still in the process of recruiting participants and success in attaining the numbers of participants will be reviewed when progress reports are received as required by the contracts. Projects will be contractually obliged to provide detailed progress reports by December 2010 at the latest on actual activity levels.

The level of uptake by participants in projects to date is very encouraging and indicates the strong labour market relevance of the successful projects. Feedback from participants has been very positive, indicating strong support for the innovative and employment-oriented range of education and training measures, which are being provided through the fund.

The Department has embarked on a comprehensive monitoring and financial control exercise, including visits to the locations of education and training programmes throughout the country, to ensure that programmes are being delivered as contracted for; that required documentary evidence is being maintained of programme activity, including details of course participation, logs of course activities, and records of inputs-time by project personnel; that appropriate accounts of all receipts and expenditure are being kept on site, and can be produced on demand; that projects show evidence of adhering to the quality assurance standards set down by the accrediting authorities; and that participants will be consulted directly concerning various aspects of the programmes to ensure that all project stakeholders are heard.

As of end-October 2010, €8.4 million had been paid to projects. It is anticipated that by year's end some €18 million will have been drawn from the fund. The balance of €14 million represents the liability to projects for payments that fall due during 2011, subject to them meeting the delivery terms of the contract.

The budget 2010 announcement of a fund of €20 million envisaged provision of 3,500 training and education places for the unemployed. This implied a forecast participant unit cost of €5,700. This target placement rate was achieved in October 2010, and the average participant unit cost for the first 26 programmes is now expected to be €2,900. The Department will carry out analysis of actual programme costs when final data are to hand, to include cost comparisons with mainstream provision. The objective will be to provide a value-for-money assessment of this funding model and its potential for delivering effective and efficient programmes for the unemployed into the future.

The Government remains intent on meeting the ongoing challenges in the labour market. In addition to specific labour market activation measures, this Government's continuing focus will also be on supporting and promoting enterprise development to create new jobs at national and county level. Continuing to support employment creation will be the key determinant in addressing our current unemployment problem. In the interim, we will continue to provide upskilling and reskilling opportunities to those who find themselves out of employment so that they will be able to avail of future employment opportunities. I thank the Deputy once again for raising this matter and I hope the reply has increased her level of information.