MPs highlight north-south divide

Tony Blair has describe the north-south divide as a "myth"

Prime Minister Tony Blair's attempts to play down talk of a north-south divide have been rebuffed by an all-party committee of MPs.

A report from the Commons select committee on education and employment backed the existence of a north-south jobs gap, saying "the benefits of a strong economy have not been shared equally".

"There is still a distinctive north-south pattern," according to the report.

"Unemployment in southern regions, with the exception of London, is still substantially below the average regional level.

"The International Labour Organisation unemployment rate in the north east is almost three times the rate in the south east."

'Slack labour markets'

Chairman of the Commons employment sub-committee Derek Foster MP said: "In recent months there has been a tendency for government ministers to take the view that there are plenty of jobs in all parts of the country.

"We have received a good deal of evidence which refutes that view. Our findings point to the continuing existence of slack labour markets in certain parts of the country."

The Labour MP for Bishop Auckland, who after the 1997 election resigned from the government just 36 hours after being named a minister, went on: "A failure by the government to recognise this will result in a less sophisticated response to a problem which should concern us all."

The report criticised the government's flagship New Deal for the unemployed, saying it had returned a "relatively poor performance" in "areas displaying the lowest levels of employment".

The MPs added that there had been "a failure on the part of government effectively to co-ordinate the policy response to unemployment".

The report also warned that transport was often "an important factor in aggravating jobs gaps" because "poor and expensive transport links prevent unemployed people taking up employment opportunities".

'Picks and chooses'

The report also said the method of measuring job vacancies needed to be improved to see in which areas of the country there are skills shortages.

It called for standard measures of unemployment to be used by the government, rather than methods giving it the most favourable number: "We suspect that the government has a tendency to pick and choose the measure of unemployment used depending on the picture it wishes to convey.

"There is still a tendency to use claimant count data when this might not be the appropriate or the most accurate measure."

"This seems to be inconsistent with the move to International Labour Organisation definition and inappropriate, given the extent to which unemployment is hidden in high unemployment areas."