Chancellor Emphasizes Jobs Over Benefits for Young People

Chancellor John Healey stated that the most valuable offering for young people is employment, not welfare benefits. Addressing the need to reduce the nation's benefits bill, Healey described cutting welfare spending as "more than an economic must - it's a moral duty."

"The best thing we can offer a young person is not a benefit payment - it's a first job with training and a wage," he said during a speech at Labour's annual conference.

He announced an expansion of the Local Apprenticeships Service for mayors across England, an initiative projected to create thousands of additional apprenticeships. This service, slated to roll out from March 2027, will receive an additional £100 million, funded by savings within the Department for Work and Pensions. Local teams will be tasked with connecting young individuals with employers, including small businesses that have not previously engaged trainees.

Healey's remarks come as he faces pressure to manage government borrowing costs ahead of the upcoming Budget. He assured markets that all government commitments would adhere to "fiscal discipline," emphasizing his unity with Prime Minister Andy Burnham on meeting fiscal rules. The Budget aims to provide "breathing space" for families and businesses.

He attributed the current fiscal constraints to the previous Conservative government, stating that Britain now spends more on debt than on the Home Office, Ministry of Defence, and Ministry of Justice combined. He acknowledged that the financial resources available to the current government are significantly less than those of the "New Labour" era of the 1990s.

Responding to Healey's speech, Conservative shadow chancellor Andrew Griffith criticized Labour's stance on welfare, asserting that "Labour MPs will never support cutting the out-of-control welfare bill" and suggesting that Labour's policies would lead to "more taxes if you work and more benefits if you don't."

Healey highlighted the challenge of one million young people in the UK not in education, employment, or training (Neets), describing the situation as a "necessity" to ensure benefits serve as a pathway to work rather than a "trap."

"It is not progressive to allow a bigger and bigger benefits bill, and a system which offers an income but doesn't offer a future," he stated.

The expansion of the Local Apprenticeships Service is a scaled-up version of an initial pilot program. Mayors will hold the authority to implement the scheme, as Healey believes they possess the best understanding of local hiring needs and available training resources.

This initiative coincides with the expected release of recommendations from a report by former minister Alan Milburn, which aims to address the issue of Neets among 16 to 24-year-olds. Healey pledged that the Labour government would take action for these young people who he feels have been "signed off, written off."

In other announcements, Healey reiterated his commitment to "re-industrialise the country" and noted that Rolls-Royce plans to increase its investment in British factories by an additional £300 million. He also confirmed the revival of the Union Learning Fund in England, originally established in 1998 and later abolished by the Conservative government, to support skill development for working individuals in the context of artificial intelligence.