Clegg's Job Scheme: Labour Questions Source of Funding

The £1 billion Youth Contract Programme unveiled by Deputy Prime Minister Nick Clegg has raised many eyebrows in the opposition who are doubtful about the source of funding.

Labour said they can't see any source of funding for the three-year scheme and dubbed it as a wrong strategy. "Where is the money going to come from?" the BBC has quoted shadow work and pensions secretary Liam Byrne as saying.

"If the government is slashing working families' tax credits to pay the bill for this new scheme, it beggars belief. That tells you everything you need to know about how out of touch the government is with the needs of our young people and squeezed middle families across Britain," he added.

The coalition has been criticised for failing the young and scrapping its future job funds which enabled the employers to provide job to long-term unemployed. The country's youth unemployment rate has crossed one million, a record high in the last three months to September.

The youth contract announcement is made at a time when the unemployment rates are the highest since 1996. The programme is expected to begin next April and aim to get young people into a range of employment sectors both in the traditional and emerging areas. Jobs are to be created in sectors like retail, construction and green economy.

The programme is also set to cover about 160,000 young people in the age group of 18 to 24 in England, Wales and Scotland. They will be recruited by the employers using wage incentives worth £2,275, which is half of the youth national minimum wage for six months.

"It's a contract, a two-way street: if you sign up for the job, there'll be no signing on for the dole," says Nick Clegg.

The programme also envisages giving work experience placements lasting up to eight weeks to another 250,000 unemployed youngsters in the age group of 18 to 24. A new £50 million programme known as NEET (Not in Employment, Education or Training) is also planned for the 25,000 most disadvantaged young people into apprenticeships or work.

Meanwhile, next week's release of the official job data is not expected to bring any solace to the government which is already feeling the heat of record youth unemployment rates.