A significant initiative designed to reduce youth unemployment and the benefits bill will not yield savings until the end of the decade and will require increased taxpayer funding in the interim, according to its architect.
Ministers have enlisted Alan Milburn, a cabinet minister during the Blair era, to develop recommendations for decreasing the number of individuals aged 16-24 who are not in education, employment, or training (NEETs). Between April and June 2026, an estimated 981,000 people were classified as NEETs. While this represents a slight decrease from the previous quarter's figure of over one million, the number remains 30,000 higher than in 2025.
Milburn indicated in a recent interview that while his plan aims to reduce benefit spending by reforming the system, it is envisioned as a "10-year plan for youth participation." He stated, "If we're going to put in more support for young people ... of course we're going to have to invest behind that. That absolutely has to happen."
Visiting the Netherlands, where the NEET rate is considerably lower than in the UK, Milburn noted that achieving comparable levels would take more than two to three years. He was responding to a question about whether the proposed reforms could help balance the budget by 2030.
He also suggested a proposal that could appeal to proponents of devolution, such as Andy Burnham: allowing regional mayors to retain and reinvest funds saved from the welfare budget within their local areas if they contribute to getting people back into work. "If you're going to rewire the state, you've got to re-plan how money flows," Milburn commented. "I've always believed that what everybody estimates is the importance of financial incentives."
These developments follow new figures suggesting the UK's NEET crisis may be more severe than previously understood, with tens of thousands of young people unaccounted for in official statistics. Analysis from the Children's Commissioner's office indicates that as many as 42,000 16 and 17-year-olds in England who are enrolled in college are attending less than half their scheduled sessions, thus remaining absent from official NEET figures. This suggests the actual number of NEETs in this age group could be nearly double previous estimates.
Unlike schools, attendance is not monitored by the Department for Education in further education settings. To address this, the Children's Commissioner's office acquired data from 262 out of 290 college groups in England, providing the first precise overview of attendance rates in colleges and training centres. The data revealed that 28,528 16 and 17-year-olds were "severely absent" in Spring 2026, meaning they missed half of their expected sessions.
Extrapolating this across all English college groups estimates that approximately 41,995 students are disengaged from education without appearing in official NEET statistics. Milburn commented on these findings, stating, "The fact that colleges have no obligation to report attendance means tens of thousands of young people can disengage entirely without clear accountability."