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HMRC internal manual

Employment Income Manual

Employment income: New Deal: introduction

New Deal was phased out on a rolling programme ending in September 2011. This guidance will be retained until all potential New Deal recipients are out of the in date tax years.

New Deal is part of the Government’s ‘Welfare to Work’ plan administered by the Employment Service on behalf of the Department of Employment (DE). Payments to New Deal participants are made under the Employment and Training Act 1973. New Deal was started in pathfinder areas in January 1998 and was rolled out nationally in April 1998.

The aim of New Deal is to help those unemployed for six months or more, who are claiming Jobseeker’s Allowance (JSA), to get a job and to improve their future employment prospects.

Initially New Deal was for people aged between 18 and 24, but from June 1998 it was extended to include those aged 25 or over.

A further scheme for people aged 50 or over, New Deal 50 plus, was introduced in pathfinder areas from 25 October 1999 and rolled-out nationally in April 2000.

How New Deal works

After 6 months or more unemployed, people participating in New Deal enter a ‘Gateway’ period. This lasts up to four months during which time the participant receives intensive advice designed to help overcome barriers to employment.

During this period the participant continues to receive JSA (see EIM76220) and has the support of a New Deal personal adviser.

At the end of this period the participant has the option to join one of four different New Deal schemes (see EIM01652).

Enquiries on New Deal

General enquiries on the New Deal scheme should be directed to the New Deal personal adviser. For tax and NICs enquiries on New Deal see EIM01653.