Solving the NEET crisis : skills for a sovereign Britian

FOR IMMEDIATE RELEASE

Milburn is right about the diagnosis. Britain needs a policy that matches it.

Skills Centres pay young people to learn a sector instead of paying them to stay at home, funded by the levy employers already pay.

London, July 27, 2026 - Alan Milburn's interim report into Young People and Work names a failure Britain has known about and failed to act on for more than a decade. Nearly one million 16 to 24-year-olds are not in education, employment, or training. The state spends £25 keeping each young person on benefits for every £1 spent helping them into work. As Mr Milburn put it on 23 May: "Just because you've got a diagnosis or a condition, why should that lead you to being transported into a world of benefits rather than into the world of work?"

Mr Milburn's May 2026 interim report had already named the trajectory: "Six in ten have never had a job. Twenty years ago, that figure was closer to four in ten. Detachment is no longer temporary. For too many young people, it is becoming permanent. We are at risk of a lost generation." The structural mechanism was diagnosed with equal clarity: "the first rung of the career ladder has thinned. For too many young people, it is now simply out of reach." The interim report also established the demand-side counter to the lazy narrative about young people refusing work: 84 per cent of NEET young people surveyed told the review they wanted a job or training.

The diagnosis is correct, and the remedies currently on the table are not equal to it, as Mr Milburn's interim report anticipated: "new programmes layered on top of a broken system cannot work."

The expansion of Sector-Based Work Academy (SWAPs) programmes announced by the Work and Pensions Secretary, Pat McFadden, on 25 May will reach around 28,000 16 to 24-year-olds a year for six weeks each by . Even at the upper end of the three-year package (300,000 work-experience placements across all ages, half of them via SWAPs) the intervention nudges the £1 column. The young person remains a claimant throughout, and returns to claimant status at the end. The £25 column is untouched.

Prosperity 2030, the policy programme published by the Institute for Global Prosperity at UCL in July 2026, sets out the structural alternative.

Skills Centres convert the 640-office Jobcentre Plus estate, the Growth and Skills Levy, and the Adult Skills Fund into a sectoral employer of record for young people. At steady state, around 600 Skills Centres hold approximately 330,000 16 to 24-year-olds in continuous attachment as Trainees and Apprentices. Trainees are paid £7,525 a year by the Centre; Apprentices £19,500. The Centre carries the training, the progression, the credentialing, and the multi-firm work dispatch. The young person is a wage earner, not a benefit claimant.

Where workfare conditions benefits on unpaid labour, the Skills Centre pays a wage for regulated sectoral employment, with full training, structured progression and lifelong attachment. This is the institutional model the highest-performing European labour markets (the Dutch MBO, the German dual system, the Swiss apprenticeship) use to hold the youth-to-work transition that Britain's system has let fracture.

Skills Centres dispatch Trainees to hosts at a fully-loaded rate of £8 per hour, below the projected National Living Wage but above the welfare floor when combined with the cost-of-living reductions that Universal Services deliver. The gap is funded by the redirected Growth and Skills Levy. That rate returns to the formal economy a category of work the cash-wage floor has priced out: council parks teams maintaining the public realm, community kitchens with paid cooks, repair workshops with an apprentice helper, care providers expanding entry-level provision, micro-enterprises that cannot carry a junior wage at full NLW plus employer overhead. The Trainee tier is the mechanism through which Britain's social fabric (high streets, parks, community spaces, repair networks, the civic infrastructure stripped by fifty years of cost discipline) gets the labour it needs to be rebuilt.

No new money is required. The wage bill is carried by the redirected levy and by firms paying for work performed, and the benefits the state currently pays fall away as young people move from the caseload to the payroll. The £25:£1 ratio Mr Milburn cites is the sign of a category error: Britain has been using welfare money to manage young people alongside the workforce, when the levy employers already pay, routed through an employer of record, would place them inside it.

Professor Dame Henrietta Moore, Director, UCL Institute for Global Prosperity, said:

Mr Milburn has named the failure with precision. The welfare state designed for the unemployment shocks of the twentieth century is transporting our young people into dependency at a scale Beveridge would not have recognised. Another work-experience scheme is not the answer. The answer is the institution that meets a young person at sixteen and stays with them across a working life, and that puts them to work doing what the country actually needs done. Skills Centres are that institution.

Andrew Percy, author of Prosperity 2030, said:

The £25:£1 ratio is real. So is the solution. We have been spending welfare money to keep young people outside the labour market when the same money, paid by an employer of record that meets them at sixteen, puts them inside it as workers learning a sector. The test of the response to Mr Milburn is simple: does it reform the structure, or place another layer of conditionality on the person? Prosperity 2030 redesigns the institution.

Prosperity 2030 (prosperity2030.uk) is published by the UCL Institute for Global Prosperity. It comprises 30 policies across three sections: 10 Services, 4 Revenue reforms and 16 Structural reforms. Skills Centres sit within the Structural reform package alongside GB Energy, the National Food Service, the National Digital Service, and the structural reform of Britain's housing market.

Notes to Editors

Skills Centres at a glance

• Estate: Built on the existing Jobcentre Plus footprint (~640 offices, GB). Northern Ireland's Jobs and Benefits Offices integrated separately under devolved arrangements.
• Funding architecture: Absorbed JCP operational funding (£1.5B to £2B a year); redirected Growth and Skills Levy (£3B a year of a £5.7B redirectable pool); firm labour charges at fully-loaded rates. Self-funding from Year 3.
• Capital ask: £1B to £1.5B over five years for conversions and Advanced Centre fit-outs, fully funded in Prosperity 2030 by tax reforms.
• Network at maturity (Year 5): 500 to 700 Centres holding 840,000 registered workers across four Statuses (Apprentice, Trainee, Part-Time, Occasional). 330,000 are aged 16 to 24.
• Pay floors at 2030 projection: Trainee £6.27/hr (£7,525/year, 1,200 availability hours); Apprentice £13.54/hr (£19,500/year). Combined with Universal Services cost-of-living reductions (£2,500 to £3,500 per household per year), the effective Trainee rate sits at the projected NLW level in real welfare terms.
• Trainee dispatch rate to hosts: £8/hr fully loaded, designed to make sub-NLW community renewal work economic again. Funded from the redirected Growth and Skills Levy.
• Rollout: Year 1 legislative and preparatory (5 to 10 demonstrator conversions). Year 2: 100 to 150 conversions. Year 3: 300 to 400 Centres. Year 4: 400 to 550. Year 5: 500 to 700 at steady state.

Comparative scale: SWAPs vs Skills Centres

Sector-based Work Academy Programmes (SWAPs): https://www.gov.uk/government/news/employment-lifeline-for-young-people-across-the-country-as-government-offers-300000-new-work-experience-and-training-placements

Skills Centres: https://platform.prosperity2030.uk/policies/skills-centres/ https://platform.prosperity2030.uk/appendices/skills-centres-appendix/

• 16-24 youth reached annually
  • SWAPs (2026-27 target): 28,000 (25,000 in 2025/26)
  • Skills Centres (Year 5): 330,000 in continuous attachment
• Duration per participant
  • SWAPs (2026-27 target): 6 weeks
  • Skills Centres (Year 5): 1 to 4 years (Trainee/Apprentice); ongoing (Part-Time/Occasional)
• Pay status during engagement
  • SWAPs (2026-27 target): Claimant on UC/JSA/ESA
  • Skills Centres (Year 5): Wage earner, paid by Skills Centre
• Employer of record
  • SWAPs (2026-27 target): None inherent; host firm during placement
  • Skills Centres (Year 5): Skills Centre, across multiple hosts and across years
• Work performed
  • SWAPs (2026-27 target): Host-firm tasks during placement
  • Skills Centres (Year 5): Sectoral work, including community renewal at sub-NLW dispatch rates
• Eligibility gate
  • SWAPs (2026-27 target): Active benefit claim
  • Skills Centres (Year 5): Open to anyone aged 16+