- 2:53 pm
- I would like to make a statement on our new package of support to tackle the long-term problem of youth unemployment. Let me begin by wishing you, Madam Deputy Speaker, and the whole House a very happy St Patrick’s day. This year, due to Lenten abstinence, I will toast it with Guinness zero—one of the world’s great inventions.The UK has historically high levels of employment overall. In its most recent report, the Office for Budget Responsibility said that employment would rise in every year of the forecast from 2026, and that unemployment would peak this year and fall in every year of the forecast after that. In fact, in only two of the last 150 peacetime years was the employment rate higher than it was in 2025. However, a particular and long-term issue faces the young, and it is time that young people were offered more hope and opportunity. That is what the package that we are bringing forward will do.At almost 1 million, the number of young people not in education, employment or training is much too high. The Conservatives try to claim that that is all a result of decisions taken over the past two years—
- It is!
- In fact, we can hear them claiming it right now. But the truth is that the number of young people not in education, employment or training rose by 250,000 in the three years running up to the last election, and the Conservatives did precisely nothing about it. Youth unemployment has been rising since 2022, and youth employment never reached pre financial crash levels in any single year of the Conservatives’ 14 years in power. On top of that, the Conservatives kicked away the ladder of opportunity from young people when they presided over a shocking 40% fall in youth apprenticeship starts over the past decade.The problem is long term and deep rooted. We will back young people with more youth apprenticeships, more chance of getting a job, and more help in overcoming the challenges they face. We have already announced a youth guarantee to help the young unemployed. It involves intensive work coaching, 300,000 work experience and training places, and subsidised work for long-term unemployed people aged 18 to 21. However, we will now go much further, with an explicitly pro young people package, aimed at helping them to learn and earn. From this summer, we will introduce hiring bonuses for businesses that hire a young person who has been out of work for six months. The bonus will be worth £3,000 per young person. There will also be bonuses of £2,000 for small and medium-sized businesses that hire young apprentices. Both bonuses can be combined if the young person hired has been out of work for six months or more. What a contrast with the Conservatives’ record on apprenticeships, which was to take opportunity away from young people—[Interruption.] They don’t like to hear it, but I am going to continue!We are introducing new foundation apprenticeships in retail and hospitality, and new short courses in AI, electric vehicle charging point installation, electrical fitting and assembly, mechanical fitting and assembly, modular building, solar photovoltaic installation, and welding—the skills that young people need for the future. On top of that, the jobs guarantee, which we previously announced for the long-term unemployed, will be extended to those aged 22 to 24. Those young people will get six months of paid work, at 25 hours per week paid on minimum wage rates. Altogether, this will create 200,000 job and apprenticeship opportunities over the next three years.
- I call the shadow Secretary of State.
- 3:01 pm
- The Government have lost control of welfare. The benefits bill is ballooning. Sickness benefits alone will cost us £109 billion by the end of the decade. Working-age benefits are costing £161 billion right now and rising. But instead of bringing forward welfare savings, Labour MPs have chosen to spend ever more on benefits. Just the other day, they backed an extra £3 billion spending on scrapping the two-child benefit cap. It is all paid for in the same way—by taxpayers, by hard-working people, and by the businesses that employ them.First the Government tax jobs, and then they wonder why there are fewer of them. Let me tell them: if you tax it, you get less of it. Under Labour, unemployment has gone up month after month. Our youth unemployment now rivals that of Greece, at over 16%. That is one in six young people out of work, wanting employment but denied the chance—and a university degree will not save them, either. Some 700,000 graduates are out of work, and nearly 1 million young people are not in education, employment or training. So many young people have done everything asked of them. They have studied hard, done their exams and got their grades, but now they are getting rejection after rejection to their job applications.The Government are letting down a whole generation, and the Secretary of State knows it. He said so himself this week on the radio. He talked about the “scarring effects” of youth unemployment: worse mental health, worse outcomes and even lower life expectancy. He is right, so why are his Government making things so much worse? Let us be clear about what this new policy is. It is not a jobs plan or a serious new deal for young people; it is a sticking-plaster, and an expensive one costing over £1 billion. These are state-subsidised jobs to replace the real ones that Labour has killed.The Secretary of State has laid into our record on apprenticeships, but he knows perfectly well that the drop he refers to happened because we raised the standard of apprenticeships to make them a qualification that would actually count, and to make them a meaningful alternative to university, not just a way for businesses to get cheaper workers. I warn him not to just chase higher numbers in his reforms; quality matters. And why are the Government doing nothing about dead-end degrees and mounting student debt? Why not adopt the policy we have announced of cutting back on low-value degrees, and using the saving to increase apprenticeships? This Government’s answer is to just go back, cap in hand, to the taxpayer.
- I fear that the hon. Lady’s response was written without her listening to a word in the statement. She has confirmed that the Conservative party not only bequeathed us the problem, but has learned nothing about how to tackle it. There was no statement of responsibility, no statement of regret and no apology for the record on youth apprenticeships—in fact, she defended cutting youth apprenticeship starts. It is a continued pretence that somehow all of this started just two years ago.The hon. Lady asks where the funding to help young people comes from. It comes from stable management of the economy—something that the Conservatives know nothing about and that we have practised for the past two years. Young people, at whom all of this is aimed, will have heard her disparage efforts to get them into work and to give them more opportunity. They will have heard her dismiss our changes, which will boost youth apprenticeships. They will have heard her pretend that we can somehow wish all this away with tax changes. That proves that the Conservatives have learned nothing from their disastrous management of the economy. They will have heard her say that the package does not offer young people anything, when we have announced a plan to give them a new deal with more jobs and more apprenticeships. That is the difference between our approach and theirs.I want to give young people in this country opportunities to get skills, to get a job, to get off benefits and to build a better life for themselves. That is much better than kicking the ladder away and leaving the system unchanged, which is what the Conservatives did. How does the hon. Lady explain the number of NEETs rising by a quarter of a million in the last three years in which they were in power? How does she explain their lack of action to deal with it? When it comes to welfare, what I have said today is very clear and simple: the best means of welfare reform is to put work and opportunity at the heart of the system, and that is what we are doing with this plan.
- Young people are often unfairly criticised, but it is worth remembering that the vast majority of them are in employment, education or training. Those who are not deserve our support, and to be provided with opportunity, not the condemnation and ignorance that was all they got from the Conservatives in government, and all we have heard from them today. Does the Secretary of State agree with me that the number of young people not in employment, education or training is a scandal, and that it demands action? Will he set out how this new investment will support young people in St Helens North and across the country?
- My hon. Friend says that young people deserve support; I believe that with the right support, young people want to work and to make the most of their life. He asked how people in his constituency would be helped. They could be helped through the hiring incentives that I have announced, and through the hiring bonuses that will allow small and medium-sized businesses to hire a young apprentice. The young unemployed in his constituency will be helped, because we are offering hope, ensuring that they get a chance, and offering the sense of pride, purpose and dignity that comes with having a job.
- I call the Liberal Democrat spokesperson.
- The Secretary of State is correct to suggest that the Government inherited a crisis around youth unemployment. However, by introducing the hikes in national insurance contributions, the Government made that crisis into a catastrophe for young people, and supercharged the pressure on our youth across the United Kingdom. Rather than tackling what is now the root of the problem—the NIC hikes—these proposals are just papering over the cracks.Young people’s childhoods are massively different from those that many of us experienced, especially hon. Members who grew up some years ago, so I pay tribute to the organisations that get young people to the right place, including Eat That Frog, Doorstep Arts, Sound Communities and South Devon college, who do incredible work. They help young people who have come through the pandemic, those who feel as though they are in a pressure cooker because of social media, which is gnawing away at their life, and who face a cost of living crisis.The Liberal Democrats are concerned about an element of the Government’s policy: we do not understand why the Government are removing funding for apprenticeships for management. Surely managers are the people who support young people in their hour of need, as they go into work. Young people aspire to move into those positions eventually, so will the Secretary of State think again about the impact of the national insurance contributions hike on hospitality, retail and tourism industries in areas like Torbay?I was interested to hear the Secretary of State speaking on the “Today” programme on Monday. The presenter challenged him by suggesting that the NIC hike had jacked up youth unemployment, and the Secretary of State appeared to agree with that. Finally, an article in The Times suggested that the Government are thinking about making young people second-class citizens through their changes to disability benefits; I would welcome comments from the Secretary of State about that.
- The hon. Gentleman opposes the changes that we made to national insurance, but he neglects to mention that employer national insurance contributions are not required for employees under the age of 21, unless they are earning more than £50,000 a year. He opposes those changes while supporting extra expenditure on the NHS. As I have said to him a few times, if his party supports extra expenditure, it really has to support revenue-raising measures to fund it.Young people will have heard the hon. Gentleman dismiss the changes that I have set out today; in fact, they will have heard him say that if he was asked to choose between management courses and young people, he would choose management courses—that is now the established position of the Liberal Democrats. I think that many people would be surprised to hear that in some years, most apprenticeship expenditure has gone on those over the age of 25 who are already in work. We have made a choice; we have chosen young people, and for good reasons. We have chosen them because of the scarring effects of youth unemployment, which I mentioned in my statement, and we now have on record that both the Conservative party and the Liberal Democrats are opposed to our prioritisation of young people.
- I welcome this excellent initiative, with the backing of £2.5 billion of investment, and I commend the Secretary of State on trying to get a grip on the scourge of youth unemployment. We saw a generation lost during the previous Government because of the failure to support young people. What will the Secretary of State do to support disabled young people? The backlog and delays in the Access to Work programme are a real issue. Will he say more about what charities and social enterprises can do, and how they will be supported, in addition to the public sector, to get more young people who are NEET into work?
- My hon. Friend asks about disabled young people. It is really important that we get more help and support to disabled people who, in the past, were too often signed off, written off and forgotten about. That is not good enough for them or for the country as a whole. The Connect to Work programme, which is devolved to elected mayors and local authorities, is helping disabled people, and the WorkWell programme seeks to get over the divide between health advice and employment advice. She is right that there are issues with the Access to Work programme. It is a really good programme, but there is a backlog that I want to see reduced because it is an important programme that helps disabled people to get into work and stay in work.
- The national insurance tax rise and the upcoming implementation of the Employment Rights Act 2025 are just two of the reasons why businesses are on their knees. I welcome the Government’s youth guarantee, but how can the Government guarantee jobs when there will not be any businesses to offer those jobs?
- I welcome the hon. Lady’s welcome of the youth guarantee. Perhaps she might have a word with her hon. Friend the shadow Minister, who did not welcome it. She asks about national insurance, but the problem is not new—what is new is the package of help for young people that I have announced today.
- I refer the House to my entry in the Register of Members’ Financial Interests. As co-chair of the all-party parliamentary group for youth employment, I welcome the Secretary of State’s statement on these new measures. Members will know that Newcastle is home to the country’s best retail and hospitality offer, and I know many businesses will welcome the support for employing young people. Will the Secretary of State set out how his Department is working to ensure the balance between fairness in the administrative processes do not create any burden for small and medium-sized businesses to access the support?