Labour mulls plan to deny benefits to under-25 "Neets"

Rachel Reeves just lately said that Labour would be tougher on welfare than the Tories. Photograph: REX/Ray Tang

Labour is to examine proposals to deny unemployment positive aspects to young folks beneath the age of 25 unless they are concerned in “purposeful” education or embarking on an “intensive” search for a job.

Rachel Reeves, the shadow perform and pensions secretary, who lately mentioned that Labour would be tougher on welfare than the Tories, is to assess a report which says that far more than a million younger folks not in training, employment or coaching (Neets), could be rescued by its strategies.

The report by the Institute for Public Policy Study calls for:

• A new youth allowance that would substitute present out-of-perform advantages for 18–24-year-olds. It would be “conditional on participation in purposeful training or intensive task search”. The allowance would be signifies-tested, primarily based on parental earnings, for these underneath the age of 22 in the exact same way as the higher training maintenance grant.

• A new youth ensure to provide young folks access to even more training or vocational education plus intensive help to uncover function. Anybody not learning or earning following six months would be offered paid operate expertise and traineeships. The youth allowance would be withdrawn if these were refused.

• Big firms to offer apprenticeships to younger folks, according to the size of their organization, or spend a youth levy in direction of the costs of education youthful folks.

Reeves is anticipated to examine the proposals with interest. It is understood, however, that she is wary of the proposal to topic the new allowance to a implies check.

The new shadow works and pensions secretary is keen to outflank the Tories on welfare amid expanding fears in the government that Iain Duncan Smith’s flagship universal credit reform is failing. Labour sources pointed out that the celebration already has a difficult compulsory jobs guarantee – a task for all younger people out of operate for twelve months and grownups out of perform for two years or a lot more.

They would drop their advantages if they refused the task below the assure that would be funded by way of a tax on bankers’ bonuses.

Graeme Cooke, the IPPR investigation director, mentioned the proposal for a new youth allowance is developed to help decrease the numbers of youthful Neets. They account for 14% of 15-24-12 months-olds in the Uk compared with 4% in the Netherlands and seven% in Denmark.

Cooke stated: “Young people who fail to attain a very good education or make early connections to the labour market face a far greater threat of long term periods of unemployment and lower earnings. The amount of Neets in the United kingdom is a scar on our nation and represents our generation’s failure in its responsibility to the next. Our objective need to be to successfully abolish Neets, as they have effectively carried out in the Netherlands and Denmark.

“In contrast to preceding initiatives and attempts at reform in this location – Connexions, the new offers, the Function Programme and the youth contract – this approach aims to resolve the basic failures of the college-to-work transition program, rather than producing up for them.

“It generates the likely to drive enhancements in more training and vocational training provision, alongside increasing employer engagement in the educational system.

“It contains those on inactive advantages and is created close to useful activities not just advice and guidance. And it seeks to restructure the opportunities and obligations dealing with younger men and women via deep institutional reform.”

Labour mulls plan to deny benefits to under-25 "Neets"