Rishi Sunak’s Kickstart programme to get 16- to 24-year-olds into high-quality jobs may be failing, and the jobs it creates may have materialised without government funding, according to the National Audit Office.
Kickstart, which has a budget of £1.9bn, was launched by the Department for Work and Pensions in September 2020 in response to an expected surge in youth unemployment as a result of the pandemic.
It aimed to create high-quality six-month work placements for 16- to 24-year-olds on universal credit who were at risk of long-term unemployment at a time when furlough scheme was scheduled to end in October 2020.
Employers receive funding for 100% of the national minimum wage for 25 hours per week, which can be topped up by the organisation, as well as employer national insurance contributions and employer minimum auto-enrolment pension contributions. They can also receive £1,500 to help with set up costs, support and training.
DWP has limited assurance that Kickstart is having the positive impact intended. It does not know whether the jobs created are of high quality or whether they would have existed without the scheme” – Gareth Davies, NAO
Gareth Davies, head of the NAO, said: “At the start of the pandemic, DWP acted quickly to set up Kickstart to help young people into work when youth unemployment was predicted to rise significantly.
“However, DWP has limited assurance that Kickstart is having the positive impact intended. It does not know whether the jobs created are of high quality or whether they would have existed without the scheme. It could also do more to ensure the scheme is targeted at those who need it the most.”
The NAO report found that early take-up for Kickstart was low due to successive lockdowns depressing employers’ demand for workers. As of 1 November, the scheme had created 96,700 jobs against a target of 250,000.
When firms did start recruiting, the NAO said there was little monitoring by DWP to check the jobs it funded were of good quality, with young staff offered training and support, and that they were offered to the right people.
Kickstart job creation
A government spokesperson said: “We acted quickly and decisively to establish Kickstart at the start of the pandemic when it was feared unemployment levels would more than double – as this report acknowledges.
“The scheme has already delivered over 100,000 new life-changing jobs for young jobseekers on universal credit who were at risk of long-term unemployment and will continue to deliver opportunities for young people.”
TUC general secretary Frances O’Grady said: “Kickstart has not been perfect, but it has an important role to play.
“Unemployment rates are higher for young people, and the sectors they are most likely to work in have been hardest hit by the pandemic. A jobs programme for young people is still needed, so we must learn lessons from the first phase of Kickstart and improve it.”
Meanwhile, the House of Lords Youth Unemployment Committee also published a report saying urgent action was needed to tackle and prevent youth unemployment.
Lord Shipley, the committee chair, said: “Youth unemployment has blighted our society for decades and its impact can endure for years. At 11.7%, the UK’s youth unemployment rate continues to be worse than many other countries, and today more than one in eight (12.6%) of our under-25s are neither working nor in full-time study.
“Over 10 months, we spoke to young people with experience of unemployment, employers, school leaders and experts. Our report makes over 70 recommendations which would help to tackle youth unemployment. We urge the government to act.”
The committee found that current funding mechanisms for apprenticeships “tend to benefit older workers”. It recommended that government should require employers receiving funding from the apprenticeship levy must spend at least two thirds of that funding on people who begin apprenticeships at levels 2 and 3 before the age of 25.
Stephen Evans, chief executive of Learning and Work Institute said: “Too many young people are falling between the gaps of a complicated and sometimes disjointed set of initiatives. The effects of the pandemic have been layered on top of the pre-pandemic challenges of higher youth unemployment and 40% of young people not gaining a level 3 qualification.
“I’m pleased to see this report echo our calls for an Opportunity Guarantee offering all young people a job, training place or apprenticeship. That needs a joined up approach to engaging young people and a more ambitious approach to offering support.”