Prime Minister Andy Burnham is set to make a major announcement on Department for Work and Pensions (DWP) cuts next week, focusing on boosting further education for young people as a key strategy to address rising unemployment and welfare costs. According to sources familiar with his plans, Burnham will deliver a speech in the second week of his premiership centered on youth employment and training.
Welfare Bill on Course to Exceed £330 Billion
Bloomberg reports that the annual welfare bill is on track to surpass £330 billion in 2025/26, approximately £50 billion higher than in 2019/20. The issue is seen as totemic by many investors, even though the scope for material savings is very limited, according to James Smith, UK economist at ING. He noted that after Keir Starmer’s previous efforts to cut welfare spending prompted a rebellion among backbenchers, a surprise push here might be rewarded in lower gilt yields.
Burnham's Cost of Living Government
Gathering his cabinet in Downing Street for the first time, Burnham told ministers his would be a “cost of living government,” prioritizing making life cheaper for voters within existing borrowing rules. He asked colleagues: “What can we do just to take that little bit of pressure off people’s shoulders, just to give them that little extra sense that help is coming so that they can have that bit of hope that things are getting better?” He urged them to explore what their departments could do to ease cost of living pressures, both big and small. “We need to be a cost of living government, getting that cost of living down, looking at all possible ways of doing that,” Burnham said.
Support for Young People
Work and Pensions Committee Chair Debbie Abrahams commented: “In a challenging environment, businesses need help to meet rising employment costs. Reducing employer’s National Insurance contributions for under 25s will enable them to take a chance on talented young people.”
