It’s all change at Labour’s party conference in Liverpool. The mood is positive and, in an incredibly rare turn of events for contemporary British politics, proceedings kicked off with three major announcements aimed not at older people, big business or floating voters, but at younger generations.
The first was Labour’s new flagship “Your First Home” scheme, which will offer government loans to first-time buyers on “regular incomes”. The second was the expansion of the Jobs Guarantee Scheme to young people with disabilities. And the third, front and centre in Chancellor John Healey’s speech, was a new £100m “local apprenticeships service”, which will be run by mayors.
To borrow a phrase from Healey, all of these announcements are intended to be a “down payment” on young people’s lives. On their futures.
The vibe could not have shifted more; all has changed and, yet, for this Government and the young people it seeks to help, some fundamental economics remain the same.
Youth employment has become one of the hottest topics in Britain. With nearly one million 16 to 24-year-olds currently not in education, work or training – known as Neets – Labour is rallying around the “moral cause” of helping them, as Healey, the Work and Pensions Secretary, Pat McFadden, and the Government’s youth employment chief Alan Milburn, have put it. Into work. Into opportunity. Into homes of their own.
Peek behind the curtain of Labour’s new “Hope Again” slogan, however, and you find a grave financial outlook which means that getting young people into work and shoring up their financial security is also now an urgent economic cause.
As Healey put it in his speech, “the 90s are having a revival” culturally but, when it comes to Britain’s finances, there is simply less money sloshing around to do the things we want to do. On a personal level, that might be buying a house or, increasingly, even popping out for dinner. For our politicians, it means not being able to build as many social homes as they’d like or spend as much as they need on defence.
Healey, like McFadden and Milburn, is right that there is nothing “progressive” about a benefits system which signs off young people, writing them off and locking them out of employment in the process.
The simple truth, too, is that Britain cannot afford to lose the tax they would generate in work. As Milburn told me recently when I visited the Netherlands with him to survey their education system – which has resulted in the lowest youth unemployment rate in Europe – “having so many young people out of work could cost billions”.
This matters because Andy Burnham wants to spend money. The Prime Minister made another seismic announcement in Liverpool: he will fight the next general election on establishing a National Care Service which, like the National Health Service, would be free at the point of use.
It would be easy to pit generations against one another, to decry the fact that younger people will need to work to pay for this system, but that would be shortsighted. Nobody likes to think about their own mortality, but we will all get old and, eventually, die. And anyone who has encountered our creaking and expensive care system will know how urgently something needs to change.
And yet, it is true that it is the young who must work to pay for it all.
Burnham has not ruled out tax rises as a result and no wonder. For now, he is bound by his predecessor’s commitment to keep the triple lock on the state pension, which guarantees pensioners a rise every year in line with whichever is highest: wage growth, consumer price inflation or 2.5 per cent.
Unless this is scrapped, younger people face a hefty bill at a time when they are being hammered by other costs that older people never had to face: near-historically high house prices, expensive rents, student loan repayments and expensive childcare.
It is now accepted that some young people will never own a home; as Britain’s birth rate falls, we are discovering that some may never have children and, more and more, there is concern about whether they will be able to afford retirement when they eventually reach it.
We are living longer; the state pension age is rising, but the costs we carry as we age – whether that’s personal debt, a mortgage or a student loan – are rising too.
Many Labour MPs are whispering that they hope Burnham plans to announce a change to the triple lock in the years ahead. Whether he does or not, if he is serious about establishing a proper National Care Service which will be there to look after us all when we need care, Britain needs a new financial settlement for young people. One that shifts the tax burden away from young people and work, and towards older people who have accrued wealth and assets.
Healey’s autumn Budget may yet do that with new property taxes, but if Labour is serious about turning young people’s futures into a “moral cause”, avoiding intergenerational conflict, and holding onto the Gen Z voters it has started to win back from the Greens, it might need to offer young workers, who are being called to step up, more than the chance to borrow almost the entire price of their first home.