4. Hon ANNETTE KING (Deputy Leader—Labour) to the Minister for Social Development and Employment: What estimate, if any, have her officials at the Ministry of Social Development provided to her on the level of unemployment by December 2010, and how many of those unemployed will be between 16 and 24 years of age?

Hon PAULA BENNETT (Minister for Social Development and Employment) : The ministry’s most recent forecast provided to me predicted that unemployment numbers would reach 83,000 in December 2010. The ministry does not forecast by age.

Hon Annette King: Is the Minister aware that, according to predictions by both Treasury and the New Zealand Institute of Economic Research, youth unemployment is set to rise to around 20 percent by 2010, which would see over 36,000 youth unemployed, and, as she has said the recently announced youth opportunities package is a “short-term, targeted solution”, what more will she do to address the 20,000 youth who will not benefit from the package over the next 15 months and beyond?

Hon PAULA BENNETT: The numbers the member is putting out there are from the household labour force survey. They represent young people who are legitimately not engaged in anything. They could be young people who are taking a break prior to starting university, are supported by their parents, those who are about to head off on their OE, or those who are undertaking voluntary work—a number of people, and not necessarily those who are on the unemployment benefit. Those figures are predictions, not targets as members of the previous Government seem to see them. The role of this Government is to try not to reach those numbers, and that is what this package is all about.

Hon Annette King: In the May Budget, why did the Minister scrap the successful Enterprising Communities scheme, which employed around 3,000 New Zealanders of all ages, and now 2 months later is introducing the Community Max scheme for up to 3,000 people—simply a watered-down version of the Enterprising Communities scheme—funded for a shorter period, and open only to youth workers?

Hon PAULA BENNETT: The Government stopped that scheme simply because we did not think it was working. Over a 3-year period the Enterprising Communities scheme was expected to be self-sustainable. In reality it was not. The 3,000 young people going into Community Max represent a positive initiative that we think will generate work for them and see projects fast-tracked in their communities. We are incredibly positive about it.

Hekia Parata: Tēnā koe e Te Mana Whakawā o te Whare, ā, tēnā tātou e te Whare. Has the Minister seen reports of other assistance that could be made available for people on the unemployment benefit?

Hon PAULA BENNETT: Yes. I have seen reports in the media quoting Annette King as saying that Labour is contemplating extending in-work tax credit to beneficiaries at a cost of $450 million.

David Bennett: More money!

Hon PAULA BENNETT: More money! I simply ask the member whose taxes she would increase or what programmes she would cut.

Hon Annette King: Can an employer joining the Job Ops scheme use the 90-day Act and dismiss a young person without cause after 6 weeks, and thereby keep the $3,000 paid by the taxpayer and get an employee at no cost to the business for that person; and, if that is possible, what has the Minister put in place to prevent rorts like that?

Hon PAULA BENNETT: There are criteria about when employers can get that $3,000 and how long the period is for. The 90-day probationary period does apply to the scheme. Unlike members opposite, we think that employers want to step up, want to offer work to young people, want to do well by them, and want to keep them in work as much as possible. I see members opposite shaking their heads at me, thinking: “Not those nasty employers.” Actually, employers want to do those things. They believe in society as much as this Government does.

Darien Fenton: Will the Minister guarantee that no older workers will find themselves being made redundant and replaced by a youth worker as a result of her Government’s Youth Opportunities package, and will she make it an obligation on businesses that while on the scheme they are not able to make any of their existing workers redundant, like she has for those on the 9-day working fortnight?

Hon PAULA BENNETT: Work and Income is working with employers. The scheme is for new entry-level roles, and the Government is making that very clear to employers. We make no apologies for focusing on youth and on our young people in that particular package. In a 5-month period this year, 42 percent of participants in the old scheme were aged under 25 years. However, of the total number of people who got a job and went off the benefit—and those percentages are there—70 percent were over 25 years. Young people are disadvantaged through a lack of skills and experience. That is what this package will fix.