Four areas selected for work subsidy experiment: Scheme aimed at long-term jobless

THE Government yesterday named four areas selected to test a radical employment scheme in which companies will be paid to take on the long- term jobless.

Employers in east Kent, Tyneside, south and south-west London and Devon and Cornwall will be offered a temporary subsidy as a means of shortening the dole queues.

The 'Workstart' programme will offer companies the equivalent of the unemployed person's state benefit in return for giving them a job and paying them the 'going rate'.

In order to allay union fears, firms will be asked to sign an undertaking that the subsidised recruit is not displacing an existing employee.

The Government's Employment Service will run the London and east Kent pilots and employer-led training and enterprise councils will administer the test runs in Tyneside and Devon and Cornwall.

The London and Devon and Cornwall pilots will involve claimants who have been unemployed for four years and the Tyneside and east Kent schemes will involve those who have been out of work for two years.

Gillian Shephard, Secretary of State for Employment, said that although there had been pressure to extend the programme throughout Britain straight away, it was necessary to test it first.

The scheme was announced in the Budget as part of a pounds 230m package of employment measures which also included Learning for Work, which allows the unemployed to continue to claim full benefit while on full-time education courses; Community Action, which offers the unemployed opportunities to perform work of use to the community; and the extension of the Business Start-up scheme to help those who want to become self- employed. The Chancellor also announced TEC Challenge, in which training and enterprise councils are called on to suggest new ways of helping the jobless.

Meanwhile, Mrs Shephard lent her support to Disability Leave, a scheme to allow newly disabled people to have employment assessments on how they could continue in their present job or be redeployed. A dozen organisations in the state and private sector are involved, including the Royal National Institute for the Blind and Barclays Bank.