Jobcentres should be privatised if small firms continue to lose out due to the disappointing performance of the Employment Service in administering the New Deal.

Julie Duckworth: many small firms disappointed

So says the Federation of Small Businesses (FSB) in a report which criticises Jobcentres for either failing to contact small employers about the New Deal or sending inappropriate applicants for interview.

The survey of attitudes to the New Deal also finds that small firms' take-up of workers under the scheme is disappointing - but that those owners who did employ someone were impressed with the candidate.

The survey of 1,800 business owners found that the New Deal appealed to two-thirds (66 per cent) of respondents because of the subsidy paid to the employer when taking on somebody, and half of those surveyed had considered recruiting an employee under the scheme.

Commenting on the results, Julie Duckworth, the FSB's North Yorkshire regional chairwoman, said: "If it cannot make the grade, the Employment Service has prime High Street locations which would be attractive to the private sector.

"Certainly, many small firms have been disappointed at the quality of applicants for jobs. For the New Deal to be a success, the Employment Service must perform the gateway role effectively. Small business owners will be more confident of the scheme if unsuitable candidates are filtered out before employers waste their time with interviews."

However, the Department for Education and Employment (DfEE), refuted the survey's findings. ""It is important to remember that the aim of New Deal is to enable young people to move from welfare into work and to stay in work by helping them find jobs which suit them and for which they are suited," said an DfEE spokeswoman.

The £3 billion New Deal programme was launched by the Government to get the long-term young unemployed back into work. The scheme has since been extended to include older workers and other groups of people out of work.

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