Short-changing the kids

This Budget put profit before young people.

The Chancellor's key soundbite during his Budget speech was that Britain will be "held aloft by the march of the makers", but it will also be accompanied by the silent march to the jobcentre by the young jobless – especially those aged 16-19.

No one seems to have noticed that Osborne's Budget was void of any substantial help for them. Instead, he offered tax breaks for corporations, to help their profit margins. And even what scraps he did offer had nothing to alleviate the pressures faced by young people in this country today.

The government will say it is increasing apprenticeships by 12,500 a year. Although this is of course welcome, ultimately it will be possible only if there are jobs created. More importantly, however, it has nothing to offer the almost 200,000 young people doing NVQs, many of whom will be receiving EMA or will have to complete the course to be able to go on to do an actual apprenticeship.

The Budget did not have a single word to say to these young people. If anything, George Osborne's silence on this speaks volumes for this government's overall commitment to the young.

Take the news on stamp duty: the average age of a first-time housebuyer is 30 and is expected by some to rise to 44. Or the raising of the personal allowance: this won't help the almost one million unemployed young people in the country. And as only 23 per cent of 16-to-17-year-olds were in employment in the last quarter of 2010, this is clearly not something the majority of adolescents can benefit from.

Then there was the headline announcement: a penny off fuel duty, accompanied by fare rises of 6.2 per cent on average. How will this help young people, when so many more of them use public transport?

You would think that, faced with such facts, the last thing a government would do, if it really had the interests of young people at heart, would be to continue scrapping EMA, especially after a number of leading economists last week signed an open letter in support of the policy. Osborne could have even looked at his own Budget, as on page 33 of the Red Book it even states that participation in learning by 16-to-18-year-olds has continued to rise.

But no extra money will come from the Treasury for EMA's planned replacement, meaning that it will have to be found from within the Education Department, leading to further education cuts.

There are strong rumours that the extra funding will come from careers advice for 16-to-19-year-olds, an area heavily deprived of funds already. Only this week leading head teachers warned the government that closing the Connexions youth service will put almost two million young people at risk of having to enter the job market bereft of advice.

The English economic historian and advocate of further education R H Tawney wrote of education in England in the 1920s that the biggest obstacle it faced was that "the prevailing temper of Englishmen is to regard as most important that which is commercially profitable, and as of only inferior importance that which is not". Ninety years later, it still rings true.

James Mills is part of the Save EMA campaign.

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What type of Brexit did we vote for? 150,000 Conservative members will decide

As Michael Gove launches his leadership bid, what Leave looks like will be decided by Conservative activists.

Why did 17 million people vote to the leave the European Union, and what did they want? That’s the question that will shape the direction of British politics and economics for the next half-century, perhaps longer.

Vote Leave triumphed in part because they fought a campaign that combined ruthless precision about what the European Union would do – the illusory £350m a week that could be clawed back with a Brexit vote, the imagined 75 million Turks who would rock up to Britain in the days after a Remain vote – with calculated ambiguity about what exit would look like.

Now that ambiguity will be clarified – by just 150,000 people.

 That’s part of why the initial Brexit losses on the stock market have been clawed back – there is still some expectation that we may end up with a more diluted version of a Leave vote than the version offered by Vote Leave. Within the Treasury, the expectation is that the initial “Brexit shock” has been pushed back until the last quarter of the year, when the election of a new Conservative leader will give markets an idea of what to expect.  

Michael Gove, who kicked off his surprise bid today, is running as the “full-fat” version offered by Vote Leave: exit from not just the European Union but from the single market, a cash bounty for Britain’s public services, more investment in science and education. Make Britain great again!

Although my reading of the Conservative parliamentary party is that Gove’s chances of getting to the top two are receding, with Andrea Leadsom the likely beneficiary. She, too, will offer something close to the unadulterated version of exit that Gove is running on. That is the version that is making officials in Whitehall and the Bank of England most nervous, as they expect it means exit on World Trade Organisation terms, followed by lengthy and severe recession.

Elsewhere, both Stephen Crabb and Theresa May, who supported a Remain vote, have kicked off their campaigns with a promise that “Brexit means Brexit” in the words of May, while Crabb has conceded that, in his view, the Leave vote means that Britain will have to take more control of its borders as part of any exit deal. May has made retaining Britain’s single market access a priority, Crabb has not.

On the Labour side, John McDonnell has set out his red lines in a Brexit negotiation, and again remaining in the single market is a red line, alongside access to the European Investment Bank, and the maintenance of “social Europe”. But he, too, has stated that Brexit means the “end of free movement”.

My reading – and indeed the reading within McDonnell’s circle – is that it is the loyalists who are likely to emerge victorious in Labour’s power struggle, although it could yet be under a different leader. (Serious figures in that camp are thinking about whether Clive Lewis might be the solution to the party’s woes.) Even if they don’t, the rebels’ alternate is likely either to be drawn from the party’s Brownite tendency or to have that faction acting as its guarantors, making an end to free movement a near-certainty on the Labour side.

Why does that matter? Well, the emerging consensus on Whitehall is that, provided you were willing to sacrifice the bulk of Britain’s financial services to Frankfurt and Paris, there is a deal to be struck in which Britain remains subject to only three of the four freedoms – free movement of goods, services, capital and people – but retains access to the single market. 

That means that what Brexit actually looks like remains a matter of conjecture, a subject of considerable consternation for British officials. For staff at the Bank of England,  who have to make a judgement call in their August inflation report as to what the impact of an out vote will be. The Office of Budget Responsibility expects that it will be heavily led by the Bank. Britain's short-term economic future will be driven not by elected politicians but by polls of the Conservative membership. A tense few months await. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.