Work and Pensions Secretary Pat McFadden has announced a £1bn youth employment scheme, offering companies a £3,000 grant for each hire of a person aged 18 to 24 on benefits and job-seeking for at least six months. The funding aims to create 200,000 jobs as part of a 'new deal for young people'.
McFadden also introduced an apprenticeship incentive, paying small and medium-sized businesses £2,000 for every new employee aged 16 to 24, with payments staggered from June. The government is scrapping some management apprenticeships, of which 80% are taken by existing employees over 25.
In a speech in east London, McFadden signalled a fresh attempt at welfare reform after predecessor Liz Kendall's plans were blocked by a Labour backbench rebellion last year. He said Labour MPs should support reforms that 'put work and opportunity at its heart', adding there was 'no reason' for opposition.
The government is also slowing the minimum wage rise for younger workers, giving the Low Pay Commission flexibility on timing. Business Secretary Peter Kyle said the government remains committed to removing discriminatory age bands but prioritises employment prospects for younger workers.
Shadow Work and Pensions Secretary Helen Whately criticised the scheme, saying the best way to tackle youth unemployment is to 'back businesses to create jobs, not tax them out of existence'. The number of young people not in education, employment or training (Neets) stands at nearly one million, with the proportion who are sick or disabled doubling to 45%.
