‘Labour must offer the politics of opportunity and aspiration’

A lodestar for every Labour Government is that we extend opportunities for all young people and families – especially those not fortunate enough to have access to wealth. In less than two years in office, Keir and his Cabinet presided over the end of the two-child cap, more help for parents with childcare costs, a £39 billion package for social and affordable housing and the start of wholescale reform of the broken SEND system. 

Our party should be proud of this record, but restless to do more to help the ambitious and aspirational young adults who are crucial to both our electoral success and, most importantly, the future success of the country. It is young people who propelled our party to victory in 2024 and, despite all we have achieved in our first two years in office, their challenges do not always feel as central to our political discourse as they should.

Before our next Prime Minister moves into Downing Street, it’s an opportune time for the Labour Party to reflect on the barriers that people in their 20s and 30s are facing and look at some of the policy ideas worth exploring and debating.

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Levels of poverty are highest among young adults and in families with children aged 0-4. The Fabians have recognised this challenge and earlier this year, proposed a new baby & toddler top-up to Universal Credit. The proposals are scalable, but by boosting the UC of the parents of babies by £86 per month and toddlers by £43 per month, you would lift tens of thousands of children out of poverty. They argue that much of the circa £715 million cost could be met by reform of the Marriage Tax Allowance and the hundreds of millions in annual underspend. We know how critical the early years are and the outsized impact in helping parents who want to give their children all they need at the start of life.

It’s not just young parents who are under pressure. Young adults working exceptionally hard can often feel their options for the future narrow when faced with a combination of high housing costs and, in the case of graduates, a high marginal tax rate that encompasses repayments on their student loan.

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I have written previously for LabourList about the Citizens Advance. The concept is simple: choose to push back your state pension age by a year, in exchange for bringing forward one year of your state pension as a lump sum, now worth over £12,500. The principal motivation is to redress the imbalance between those who can rely on the Bank of Mum & Dad to get ahead and those who cannot. Interest in the idea is building, thanks to a brilliant report from the Social Market Foundation that was released last month. I believe that exploring the Citizens Advance concept has a place in a much wider debate about the role of the state in building asset wealth for everyone in society. 

The future of Plan two student loans is also deserving of scrutiny. We are not in a fiscal position where the general taxpayer can or should be asked to do more to support graduates, but that does not mean a debate about the shape of loan repayments should be off limits. There is a compelling argument to review the 9% monthly repayment rate, the earnings threshold at which repayments begin and the length of the loan. Different policy combinations vary from those that are cost neutral to HMT to proposals that would cost billions. There are no easy answers, but it is also far from easy to earn a starting graduate salary, live independently and have any space to build your own savings for the future.

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Young adults fully understand that there are trade-offs in politics. Opinion polls consistently tell us that the under 40s are both the most optimistic about the future and invariably, most likely to consider voting Labour. As we prepare for new leadership, we should redouble our efforts to put the issues affecting younger people and young adults at the centre of our politics.

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