What Labour is really proposing for under-25s on benefits

The party isn't planning to "scrap benefits for under-25s". It's planning to guarantee them work or training.

There's been much outrage this morning at a report in today's Telegraph that Labour is planning to "scrap benefits for under-25s", with party supporters accusing it of entering a race to the bottom with the Tories. But the reality is more complex than the fury suggests. 

The first point to note is that the idea is contained in an IPPR paper due to be published later this week; it isn't, contrary to what the Telegraph suggests, party policy (yet). The second is that the report itself doesn't even propose scrapping benefits for the under-25s. Rather, it calls for a new means-tested "youth allowance" for 18-24-year olds who are not in work or education. This would be set at £56.80, the same level as the youth rate of Jobseeker's Allowance, and would be conditional on participation in "purposeful training" or "intensive" job hunting. This might seem objectionable but it's some distance from abolishing all benefits for the young. 

But there's another important detail that's been missed entirely. Were Labour to adopt the plan (with an announcement likely to be made in Rachel Reeves's first speech as shadow work and pensions secretary in January), it would do so only on the basis of guaranteeing all-under 25s a job (paying at least the minimum wage), or a place on an approved training scheme. The upfront costs will be high, but so will the long-term savings. (It's odd, incidentally, that some on the left seem to think it's better to pay young people just £56.80 a week than to guarantee them a job paying the minimum wage.) This enlightened approach contrasts with that of the Conservatives, who have proposed removing all benefits from under-25s who aren't "earning or learning" but haven't offered anything resembling a jobs guarantee. 

As Labour a spokesperson told me: "Labour policy is a jobs guarantee for young people.

"Ed Miliband has talked about making the welfare system work for young people, with a compulsory jobs guarantee, to sustainably bring down the social security bill.

"Compare that with Cameron's simplistic attempts to take benefits from all young people, which would harm the severely disabled, which were drawn up on back of a fag packet to try and please Tory conference."

There are plenty of questions that remain for Labour. How will these jobs be created? Party sources suggest that companies will sign up to the scheme voluntarily but it isn't clear what incentives will exist for them to do so. Will jobseekers be offered a choice of posts are be forced to accept one unsuited to them? And how will it all be paid for? 

But to one question at least - is Labour planning to scrap benefits for under-25s? - there is a definitive answer: no. By promising to guarantee them work or training, it's actually planning to increase them. 

People enter the Jobcentre Plus office on January 18, 2012 in Bath, England. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Theresa May's cabinet regroups: 11 things we know about Brexit negotiations so far

The new PM wants a debate on social mobility and Brexit. 

This was the summer of the Phony Brexit. But on Wednesday, the new Tory cabinet emerged from their holiday hideaways to discuss how Britain will negotiate its exit from the EU. 

The new prime minister Theresa May is hosting a meeting that includes Brexiteers like David Davis, now minister for Brexit, Boris Johnson, the new Foreign secretary, and Liam Fox.

For now, their views on negotiations are taking place behind closed doors at the PM’s country retreat, Chequers. But here is what we know so far:

1. Talks won’t begin this year

May said in July that official negotiations would not start in 2016. Instead, she pledged to take the time to secure “a sensible and orderly departure”. 

2. But forget a second referendum

In her opening speech to cabinet, May said: “We must continue to be very clear that ‘Brexit means Brexit’, that we’re going to make a success of it. That means there’s no second referendum; no attempts to sort of stay in the EU by the back door; that we’re actually going to deliver on this.”

3. And Article 50 remains mysterious

A No.10 spokesman has confirmed that Parliament will “have its say” but did not clarify whether this would be before or after Article 50 is triggered. According to The Telegraph, May has been told she has the authority to invoke it without a vote in Parliament, although she has confirmed she will not do so this eyar.

4. The cabinet need to speak up

May’s “you break it, you fix it” approach to cabinet appointments means that key Brexiteers are now in charge of overseeing affected areas, such as farming and international relations. According to the BBC, the PM is asking each minister to report back on opportunities for their departments. 

5. Brexit comes with social mobility

As well as Brexit, May is discussing social reform with her cabinet. She told them: “We want to be a government and a country that works for everyone.” The PM already performed some social mobility of her own, when she ditched public school boy Chancellor George Osborne in favour of state school Philip Hammond. 

6. All eyes will be on DExEU

Davis, aka Brexit minister, heads up the Department for Exiting the EU, a new ministerial department. According to Oliver Ilott, from the Institute for Government, this department will be responsible for setting the ground rules across Whitehall. He  said: “DExEu needs to make sure that there is a shared understanding of the parameters of future negotiations before Whitehall departments go too far down their own rabbit holes.”

7. May wants to keep it friendly

The PM talked to Prime Minister Sipilä of Finland and Prime Minister Solberg of Norway on the morning of the cabinet meeting. She pledged Britain would "live up to our obligations" in the EU while it remained a member and "maintain a good relationship with the EU as well as individual European countries".

8. But everything's on the table

May also told the Finnish and Norwegian prime ministers that negotiators should consider what is going to work best for the UK and what is going to work for the European Union, rather than necessarily pursuing an existing model. This suggests she may not be aiming to join Norway in the European Economic Area. 

9. She gets on with Angela Merkel

While all 27 remaining EU countries will have a say in Brexit negotiations, Germany is Europe’s economic powerhouse. May’s first meeting appeared amiable, with the PM telling reporters: “We have two women here who have got on and had a very constructive discussion, two women who, I may say, get on with the job.” The German Chancellor responded: “Exactly. I completely agree with that.”

10. But less so with Francoise Hollande

The French president said Brexit negotiations should start “the sooner the better” and argued that freedom of labour could not be separated from other aspects of the single market. 

11. Britain wants to hold onto its EU banking passports

The “passporting system” which makes it easier for banks based in London to operate on the Continent, is now in jeopardy. We know the UK Government will be fighting to keep passports, because a paper on that very issue was accidentally shown to camera.