Labour’s youth guarantee plan still lacks the beef

In his Worker's Day speech, Opposition leader Joseph Muscat said a new Labour government will embark on a 'youth guarantee' that will ensure every young person in Malta will be in education, training or employment.

It's the closest thing to a concrete policy proposal since the 51 ersatz proposals he hammered out after the Budget 2012 speech last year.

But Labour's two-page leaflet explaining the youth guarantee plan, with Muscat's short message, only says Labour will guarantee all young persons over 16 will be either in education, training or employment, without explaining how this plan will be implemented. 

Last week's conference at the PL's headquarters coincided with the launch of the Europe-wide 'Your future is my future - a European Youth Guarantee now!' campaign by the Party of European Socialists.

The PES campaign aims to tackle the crisis of youth unemployment in Europe by injecting €10 billion from unused EU structural funds to create two million jobs for young unemployed people by 2014.

This "new social contract" promoted by PES will allow young people to "secure employment at the latest four months after becoming unemployed or after leaving the education system".

But the PES campaign is backed up by a 32-page document highlighting the causes and effects of youth unemployment, and delves into how this plan can be implemented on a European level and what 'youth guarantee' legislation should be introduced at national level.

Speaking to MaltaToday at the end of the conference, Muscat said Labour's plan would see government helping early school-leavers identify their area of expertise through internships, job shadowing (a programme to find out what it is like to be in a specific profession) and apprenticeship.

"While we would be encouraging youths to join this programme, it will not be obligatory. While the Employment and Training Corporation would be the backbone of this project, we are also looking into the possibility of providing incentives through a public-private partnership scheme," Muscat said, adding that NGOs would also be on board.

This sounds very similar to what is being proposed by the UK Labour leader Ed Miliband. In March, Miliband pledged to "conquer" youth unemployment by guaranteeing a job to unemployed young people if Labour regains power in the UK.

However, in contrast with his Maltese counterpart, Miliband explained how the party's plan will work out... with numbers backing it up. Miliband's "real jobs guarantee" would offer six months' work to those aged 18 to 24 who had been jobless for a year. This plan was costed by the UK Labour Party at £600 million and will be funded by a bankers' bonus tax.

The specific plan is that government pays a business to cover 25 hours of work per week at the minimum wage for six months - £4,000 per job. The employer will then cover a minimum of 10 hours a week training and development, helping the young person get a permanent job with them or another company.

The youths on the plan must turn up for work, and look for a full-time job and complete training, otherwise Miliband warns they will face "tough consequences" - including possible benefit sanctions.

Miliband's 'real job guarantee' was launched in the aftermath of the £1 billion Youth Contract, launched by the UK's coalition government, which provides £2,275 to employers to take on a total of 160,000 18- to 24-year-olds for six months.

It is a similar scheme to the Nationalist government's microcredit and microinvest schemes that give credit and tax incentives to SMEs in return to employ new workers.

ETC also runs a scheme under the Employment Aid Programme, where employers receive 50% of the wage costs and half the employer's national insurance for 52 weeks when employing youths under 25.

Asked to give more detail on Labour's plan, the party's spokesperson on education Evarist Bartolo told MaltaToday that given Malta's size, the cost of such an initiative can be covered by a portion of unused European Social Funds. He explained that "in Malta's case, funding the programme is not prohibitive" as the €10 billion earmarked by the PES to fund the initiative are more than enough for a country of our size.

While stressing that the policy "can be done" he noted that the biggest challenge will be that of "ensuring the policy is relevant and effective". He cited 'embedded training' as an example, in which participants receive formal training while simultaneously performing their job duties.

Bartolo added that the party has already received "interesting" proposals from the private sector, who have expressed interest in the plan.

On the current ETC programmes available, Bartolo said that any current initiatives which are successful will not be removed. "If it ain't broke, don't fix it," the former education minister said.

But is this a political vote-winner for Joseph Muscat?

His decision to emphasise youth unemployment jars with the level of public concern on unemployment. While youth unemployment is a major issue in many European countries, according to a survey published by MaltaToday in March, employment is well behind utility bills, the cost of living and income in the list of major concerns.

The youth guarantee plan launched by Muscat comes at a time when Malta can boast of the fifth lowest level of unemployment in the EU-27 - he will have to give out more beef on this plan to make it sound convincing.