Kemi Badenoch is set to unveil a Conservative rescue package for young people out of work, including plans to halve employers’ National Insurance contributions for workers under 25.
The Tory leader will argue that her party must focus on reviving entry-level employment and making economic growth the central priority of a future government.
Under the proposal, employer National Insurance for workers aged between 21 and 24 would fall from 15 per cent to 7.5 per cent. The Conservatives say the change would allow businesses to retain an average of £1,545 for each young employee.
The measure would cost £2.3 billion a year and would be funded through reductions in existing spending, as part of a new Conservative Savings Plan due to be published today.
Mrs Badenoch is expected to link the tax cut to a wider programme aimed at reducing the number of young people claiming benefits. The plans would include preventing school-leavers from moving straight on to the dole and stopping people with mild mental health issues from claiming sickness payments.
She will say that more than a million young people are currently neither earning nor learning, and that “tough love” is needed to change the situation.
Employers have blamed higher youth minimum wages, new employment rights and increased National Insurance for making it less attractive to hire young workers.
The Conservative leader will tell party delegates in Birmingham that Britain is borrowing tens of billions of pounds a year to pay the interest on a national debt approaching £3 trillion.
“We are running out of money and running out of time to put it right,” she is expected to say.
Mrs Badenoch will accuse Labour of believing that economic growth is created by politicians and of seeking to “wind back the clock to failed ideas of the past”. She will warn that Britain faces “a battle for the soul of this nation” on a scale not seen since Margaret Thatcher confronted Labour in the 1970s.
“They think government knows best. They think that your income, your pension and your savings are theirs to take and then hand out as they see fit,” she will say.
“They claim that what they are doing is compassionate but we know that these ideas will make every single person in this country poorer.”
The Conservative leader is also poised to announce cuts to inheritance tax as she prepares for a possible election as soon as next year. Tory sources have said the party is preparing for a poll in the first half of 2027, despite Andy Burnham denying that he is planning a snap election.
Speaking to GB News, Mrs Badenoch said: “If we run out of money, none of us are going to have anything. The best welfare is a well-paying job. That means a lot of tough love.”
