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Conservatives aim for “full employment”

15th Apr 2014

The Conservatives have been committed to targeting “full employment” by George Osborne, who has declared that tax and welfare changes would help to achieve it.

The chancellor said that “unemployment is never a price worth paying, but artificial jobs paid for with borrowed money doesn’t work either”.

During the Thatcher years, the Conservatives broke with the post-war consensus on seeking full employment.  On the other hand, Labour has its own “jobs guarantee” and targets full employment as a goal.

In his speech in Essex, George Osborne said that governments which tried to guarantee people a job were “doomed to fail”, as they ended up increasing spending to unsustainable levels.  In turn this would result to taxes going up and jobs being lost.

Speaking at Tilbury docks, Mr Osborne said: “You can’t abolish boom and bust.  There are always going to be ups and downs to the economic cycle.”

However, the chancellor appeared to reject comments made by former Chancellor Lord Lamont, who said in 1991 that unemployment was a price “well worth paying” to get inflation levels down.

Mr Osborne said he was committed to securing the “fullest” possible level of employment by helping businesses to create new jobs and cutting taxes.

“That’s why today I’m making a new commitment – a commitment to fight for full employment in Britain,” he said.

When pressed on what would class as an unacceptable level of unemployment, Mr Osborne did not mention a specific figure but said his ambition was to make the UK “the best place in the world to create a job; to get a job; to keep a job; to be helped to look for another job if you lose one”.

He said: “A modern approach to full employment means backing business.  It means cutting the tax on jobs and reforming welfare.”

But Chris Leslie, shadow chief secretary to the Treasury, said the government should have backed the idea of full employment a long time ago.

“A lot of this rhetoric is not matched by the reality,” he said.  “George should tell this to the 900,000 young people who have been out of the work for more than 12 months or more”.

“Long-term youth unemployment has doubled under his watch. Actually it’s an apology he should have been giving so far.”