Another Labour U-turn? Minister says teenagers might NOT get full minimum wage before 2030 as businesses warn move will fuel youth jobs crisis

Young people may not receive the full minimum wage before 2030, a minister suggested today.

Treasury secretary Torsten Bell said there was no ‘timetable’ for Labor’s pledge to equalize rates for all adults.

This stance emerged after Labor kingpin Alan Milburn joined businesses in warning about the impact of rising costs of employing young people.

Since 2024, base pay for workers aged 18 to 20 has risen by 26 per cent to £10.85 per hour.

The minimum wage for older workers also increased, but not by that much; It rose by 11 per cent to £12.71 per hour.

The policy coincided with a period of rapidly increasing youth unemployment; This fueled fears that young people were being left unemployed.

Speaking on BBC Radio 4’s Today programme, Mr Bell insisted the Government was committed to equalizing the minimum wage for all adults.

But when pressed on whether this would happen by the end of Parliament (expected to be in 2029), he emphasized that “that’s not how it’s written in the manifesto”.

‘It doesn’t set a timetable on this because that’s the important role of the Low Pay Commission to give advice,’ Mr Bell said.

He added: ‘The manifesto commits us to equalizing rates. We are absolutely committed to doing this.’

Labour’s 2024 general election platform pledged to ‘eliminate discriminatory age gaps so that all adults are entitled to the same minimum wage and deliver pay rises for hundreds of thousands of workers across the UK’.

Shadow business secretary Andrew Griffith said: ‘This looks like yet another U-turn from this desperate Labor Government.

‘The Conservatives have been clear from the start that this Labor policy will lead to even more youth unemployment. If Starmer and Reeves are finally listening, it’s a start, but they need to go much further in recognizing that it’s businesses, not government, that create jobs and drive growth.’

In a damning new report published yesterday, Mr Milburn said the cost to the country of an increase in the number of young people classed as Neets (outside of education, employment or training) would rise to £125bn a year. This is more than the government spends on education.

Its long-awaited review has been published as new figures from the Office for National Statistics reveal the number of Neets has now passed one million.

Mr Milburn described it as a ‘moral crisis’ that one in six young people aged 16 to 25 will be on unemployment benefits by the end of this decade and said it was ‘probably the most important challenge facing our country today’.

It found that the UK is an outlier in the EU, with only Romania recording a higher rate of young Neet.

Former Workers’ Health Minister Mr Milburn backed Tony Blair’s criticism of Government policies accused of making it harder for employers to hire young people.

In a scathing attack on Labour’s policy agenda this week, the former prime minister accused Keir Starmer’s administration of lacking a ‘coherent plan’ and stalling business.

Sir Tony highlighted measures including new workers’ rights laws and above-inflation increases to the minimum wage.

Mr Milburn called for a ‘whole system reset’ of education, welfare and health policies to get young people into work, suggesting ministers should reconsider these policies.

The stance emerged after Labor kingpin Alan Milburn joined businesses and warned of the rising costs of employing young people.

Before Mr Milburn’s report was published, the ONS said the number of people aged 16 to 24 who were not in employment, education or training had risen to 1.01 million in the three months from January to March.

This figure is the highest level since the three months to December 2013, when the figures were calculated using a different method, and represents an increase of 55,000 points compared to the previous quarter.

The data showed that 613,000 of these young people were economically inactive, meaning they were not working or looking for work, marking a record high for the period.