UK is 'not just a welfare state, but a working state,' insists minister as government to invest £1bn to tackle youth worklessness

The funding, part of a “new deal” for young people set to be announced by Work and Pensions Secretary Pat McFadden on Monday, is aimed at creating 200,000 jobs.

Speaking with LBC, Mr McFadden was pushed by Nick Ferrari at Breakfast as to why youth unemployment had reached an 11 year high - rising to 16.1% according to the latest data.

"Let me tell you, the best form of welfare reform is opportunity and work. Not just a welfare state, but a working state, Mr McFadden insisted.

It comes amid a government drive to reverse the growing number of young people who are not in education, employment or training, the so-called “Neets”.

Admitting the government "are concerned" about the current unemployment figures among young people, Mr McFadden conceded that it "is a long term problem".

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Speaking with Nick, Mr McFadden insisted "I want to give young people hope. I want to give them opportunity. I'm often asked on shows like this what you're going to do about welfare reform."

During the visit to Waltham Forest College on Monday, Mr McFadden unveiled the government's new Youth Jobs Grant.

Through this scheme, businesses will receive £3,000 for every young person they hire between the ages of 18 and 24 who has been searching for a job for six months or more.

Some 60,000 people are expected to be supported by the proposals.

He will also announce a new apprenticeship incentive, under which small and medium-sized businesses will be paid £2,000 for every new employee between 16 and 24-years-old they take on.

The Government also plans to expand its existing jobs guarantee from the current age range of 18 to 21, to those up to 24-years-old.

The scheme offers young people a guaranteed six-month job if they are on Universal Credit and have been looking for a job for 18 months.

Mr McFadden said: “These measures will give life-changing opportunities to young people and significantly reverse the increase we inherited in those not in education, employment or training.

“We are focusing funding where it’s needed most and giving employers the flexibility and support they’ve asked for.

“These reforms will give young people a vital first step on the career ladderand help business leaders recruit the talent that will grow their companies.”

Prime Minister Sir Keir Starmer said his Government was “determined to tackle the rise in youth unemployment by expanding practical routes into work, boosting apprenticeships, and giving employers the clarity they need”.

“These reforms underpin our ambition to create an economy that works for everyone, closing the skills gap and supporting more young people into meaningful employment,” he added.

Tom Kerridge, the Michelin star chef, has given his backing to the scheme.

“I’ve trained apprentices in my restaurants, and I know what a great start it gives them in their careers, and these incentives will give our industry a great boost. I’m pleased Pat McFadden has made this a priority,” said Mr Kerridge.

However, the Tories warned that opportunities for work were “disappearing” under the Labour Government, something they blamed on the Employment Rights Act and the hike in national insurance contributions on employers.

Helen Whately, shadow work and pensions secretary, said: “The best way to tackle youth unemployment is to back businesses to create jobs, not tax them out of existence to fund benefits and subsidies.

“That’s why Conservatives will cut business rates for thousands of high street businesses and roll back Labour’s Employment Rights Act.

“That’s the way to create real opportunities for young people and get Britain working again.”