A House of Lords committee report says the Government needs to focus much more on the looming unemployment crisis and to ensure temporary benefits rise are permanent.
The Government is sleepwalking into an unemployment crisis and needs a strategy focused on job creation to deal with it, according to a House of Lords committee report.
The House of Lords economic affairs committee says the Government should invest in the childcare sector and social care workers and prioritise sustainable infrastructure projects that can be delivered at scale, quickly, and across the whole of the UK.
It also calls for the temporary uprating of Universal Credit to be made permanent, for those on legacy benefits to get the increase and for the introduction of a new job, skills and training guarantee, available to every young person not in full-time education or employment for one year and it says existing programmes such as Kickstart and Restart need to be better co-ordinated if they are to be successful.
The report’s other recommendations include a call to recognise the unequal nature of the economic hit on workers, with many higher paid workers experiencing little or no economic hardship; the creation of a new state entity to manage debt and repayments; and an increase in the level of statutory sick pay and the expansion of eligibility to the lowest paid.
Lord Forsyth of Drumlean, Chair of the Economic Affairs Committee, said: “The Government has given the impression that the economic crisis will be short-lived and everything will be fine by the spring. It also assumes that the good news on the vaccine means that the economy and labour market will no longer need support. Both of these assumptions are wrong.
“The sectors with jobs that historically lead labour market recoveries – hospitality, retail and leisure – have been flattened. They are likely to be in a worse state in the spring when wage support ends. Unemployment will spike.
“The Government is sleepwalking into an unemployment crisis. The Chancellor needs to get ahead of the curve to avoid being in the same position as he was in the autumn. He needs a strategy urgently for what comes next and this report sets out a comprehensive plan to save the prospects of a generation of young people.”