New Labour pushed for a 50 per cent target for school leavers. It was achieved by creating loads of useless courses.
During my leadership campaign, someone asked me to summarise my economic objectives in one sentence. I replied: “To deliver a high-growth, low-immigration economy.”
Right now, Britain has the opposite: a low-growth, high-immigration economy. It’s young people who are paying the price.
That’s why we’re launching our New Deal for Young People. We’re the only party that’s even thinking about them, because we understand that our economic and cultural problems are intertwined. You can’t solve one without the other.
Reform UK has tried to copy a lot of our immigration policy without doing the difficult thinking. They agree with us that deporting people who should not be here is a priority. But Conservatives know that alone does not turn Britain into a high-growth economy. It reduces public spending, it does not increase productivity – but our New Deal for Young People will.
The blame for our productivity problem can be laid at the feet of the Blairite settlement. For too long, politics has been run as if we’re still in the late 1990s.
Politicians hoping the world would stay the same: stable graduate jobs, stable career ladders, stable institutions, and a conveyor belt from school to university to a middle-class life. Blair pushed for 50 per cent of young people to go to university, and the Oxbridge-educated political class was too embarrassed to say no for fear of looking like hypocrites.
We didn’t get a nation of engineers and mathematicians. We hit the target by creating loads of useless courses. The result is obvious: young people loaded with debt and employers complaining about basic skills gaps. And while standards fell, parts of our university system started feeding the cultural rot.
You cannot build a high-growth economy on institutions that train young people to distrust reality and sneer at the society they are meant to inherit. Our New Deal for Young People is going to scrap the pointless courses, provide better offers and tackle the insidious debt trap. I started my degree in 1999, not long after tuition fees had been introduced.
I am horrified at what graduates today are dealing with, and this is one of the reasons millions of young people feel they’ve been stitched up. Plan 2 student loans, the system most people who started university from 2012 to 2023 are on, increasingly feel like a scam.
Under Plan 2, the interest on your loan is 3 per cent above inflation, so your loan can grow so fast that you can be paying the appropriate amount every month yet see the balance go up. It’s an infuriating situation – you’re paying money back, but every time you look at the outstanding amount, it’s rising. It just isn’t fair.
In 2012, when the policy came in, inflation and interest rates were low. It needs to be changed now, but the Labour Government is deliberately making money off the backs of graduates, and Rachel Reeves made it worse at her Budget by freezing the repayment thresholds, pulling more of a young person’s salary into repayments. That is not what student loans were designed for.
Our New Deal for Young People fixes that unfairness, backs work, and restores real choice. We scrap the extra 3 per cent and cap Plan 2 interest at RPI, so the balance stops racing upwards. Then comes the £5,000 First Job Bonus, so when a young person starts their first job the first £5,000 of National Insurance they would have paid goes into a personal savings pot for a first home deposit or future savings.
The third leg (my favourite) is the Apprenticeship Guarantee. It fixes the messy apprenticeship levy, providing fully funded training and college places for 100,000 extra 18 to 21-year-olds a year, so apprenticeships become a real alternative to university. This is where we need to deal with the snobbery against apprenticeships.
I’m the daughter of a doctor and a professor. I have two degrees myself in engineering and law, but before either degree, I did an apprenticeship. Nearly 30 years later, I remember more from that apprenticeship than I do from the degrees that came after it. I can still put together a computer and possibly wire a telephone network. I can’t remember the Fourier series or how to do Laplace transforms.
Yet for too many families, apprenticeships are still treated as something for other people’s children because policy has trained them to think that way. We built a system that flatters university even when this “prestigious” option leaves young people in debt and sometimes worse off than if they’d never gone.
We shouldn’t be surprised when they feel stitched up. They have been. If we want a country that rewards work, builds skill, and restores pride in practical achievement, we have to stop looking down on the very training routes that build the country.
The consequences of Labour’s policy failures are now staring us in the face. Graduate recruitment has collapsed. Youth unemployment is high and rising. Around 700,000 graduates are on benefits – not disability benefits, out-of-work benefits.
Sir Keir Starmer’s Labour Government, with their endless about-turns, are unable to think beyond the next five minutes, let alone the next five months. They won’t solve this. Nigel Farage doesn’t appear to care very much for anything except himself and shouting at other politicians. He won’t solve this. The Liberal Democrats are nowhere to be seen, quietly propping up the Labour Party.
The Conservatives are the only party trying to help young people, whether by abolishing stamp duty or with our New Deal for young people. It’s all part of our plans to get Britain working. Rachel Reeves should make these changes to student loans in her Spring statement, instead of piling taxes on the very businesses that create the jobs young people need.
