Kemi Badenoch has said the Conservative Party would cut National Insurance contributions for workers under the age of 25 by half, presenting the policy as a direct intervention to improve youth employment prospects. The measure, which the party describes as reversing what it calls «Labour's jobs tax», would reduce the rate paid by younger employees on their earnings.
Badenoch warned that «the world is getting worse for young people», arguing that the current economic environment makes it harder for those entering the workforce to find stable, well-paid employment. She positioned the tax reduction as a way to ease the financial burden on younger workers and encourage employers to take on staff in that age group.
The proposal targets National Insurance, a payroll tax paid by employees and employers that funds state benefits and public services. By halving the employee contribution rate for under-25s, the Conservatives argue that take-home pay for younger workers would rise, potentially making employment more attractive and helping to offset the costs associated with hiring.
The announcement forms part of the party's broader economic pitch as it seeks to draw a contrast with Labour's record in government. Conservative strategists have repeatedly characterised Labour's fiscal plans as a tax burden on working people, and the youth employment measure is designed to appeal to younger voters and their families ahead of future electoral contests.
Badenoch's remarks come amid ongoing debate about the state of the UK labour market, particularly for those at the start of their careers. Youth unemployment and underemployment have been persistent concerns, with many graduates and school leavers facing competition for entry-level roles and, in some sectors, a shortage of positions that match their qualifications.
The policy also lands in a wider political context in which the Conservatives are attempting to rebuild their coalition after a difficult period. Badenoch has faced questions about the party's direction and its relationship with other parties on the right, including Reform UK. She has dismissed suggestions of a formal coalition arrangement, while critics have mocked the idea of a pact between the two parties.
Labour figures have yet to respond in detail to the specific proposal, though the party has previously defended its economic approach as responsible and necessary given the fiscal inheritance it says it received. The Conservatives, for their part, argue that reducing the tax burden on younger workers is a targeted way to stimulate employment without adding to inflationary pressures.
Economists note that payroll tax cuts can have mixed effects. While they may boost net pay for the affected group, the impact on overall employment depends on how employers respond and whether the reduction is seen as temporary or permanent. The cost to the Exchequer would also need to be offset elsewhere or absorbed through borrowing, which could prove contentious.
For now, the proposal remains a policy pledge rather than implemented legislation. Its fate would depend on the Conservatives returning to government and securing parliamentary support for the change. Badenoch's framing suggests the party intends to make youth economic opportunity a central theme in its messaging, linking tax policy directly to the prospects of the next generation.
The announcement is likely to intensify debate over how best to support young people entering the workforce, with competing visions emerging over tax, training, and job creation. Whether the National Insurance cut becomes reality or remains a campaign promise will depend on the political arithmetic of the next election and the priorities of whichever party forms the next government.