Reeves Unveils Youth Guarantee as Budget Gap Looms

Chancellor Rachel Reeves on Monday unveiled a Youth Guarantee aimed at erasing long term youth unemployment, while facing mounting pressure from economists and think tanks to reconsider Labour’s manifesto pledge not to raise income tax, national insurance or VAT ahead of a crucial Budget on November 26. The two developments set up a fiscal trade off between delivering a high-profile social policy and finding billions of pounds to plug what forecasters and analysts describe as a substantial funding gap.

Reeves told the Labour conference that every young person who has received Universal Credit for 18 months without earning or learning will be offered a paid work placement, an apprenticeship, a college place or tailored one-to-one support. The scheme, overseen by Work and Pensions Secretary Pat McFadden, will be trialled in local areas before full rollout, and ministers say further details, including funding and how sanctions will operate for those who refuse offers without a reasonable excuse, will be set out at the November Budget. "I can commit this government to nothing less than the abolition of long term youth unemployment," Reeves said.

Delivering the guarantee will add to...