Labour Chancellor John Healey addressed the party conference in Liverpool, emphasizing the need to reform the welfare system and promote economic growth as part of a broader strategy to reduce dependency and control public spending. Speaking ahead of his first budget on October 28, Healey described getting young people off benefits and into employment as both a “moral duty” and an economic necessity.

Healey highlighted that nearly one million individuals aged 16 to 24—about 13 percent of the age group—were currently not in education, employment, or training. He warned that the existing benefits system risked becoming a “trap” that leaves people reliant on welfare without offering a clear path to work and self-sufficiency. He stated that for those able to work, benefits should serve as a bridge to employment. “It is simply not progressive to allow a bigger and bigger benefits bill and a system which offers an income but doesn’t offer a future,” he said.

To address youth unemployment, Healey announced a £100 million expansion of a local apprenticeship scheme, which will be managed by regional mayors. This initiative aims to match young people without work or training to businesses that have not previously taken on apprentices. The funding for this program is to come from savings within the Department for Work and Pensions. Healey described this commitment as a “downpayment” on broader government efforts to tackle long-term youth unemployment, including upcoming recommendations from an inquiry led by former Labour health secretary Alan Milburn. Milburn has signaled his next report will propose more contentious reforms, potentially involving mental health support, welfare eligibility, education, and employer incentives.

Healey stressed the importance of fiscal discipline, noting that the government does not have the financial resources available to past Labour administrations, such as during the New Labour era of the 1990s. He reaffirmed his and Prime Minister Andy Burnham’s commitment to maintaining the fiscal rules established under former Chancellor Rachel Reeves, which aim to balance day-to-day public spending with revenues by 2030. “There is nothing progressive about losing control because it’s always working people who pay for it,” Healey said.

The Chancellor also announced measures aimed at supporting industrial growth, including a £6 billion government commitment to contracts for British shipyards to build docks for new submarines, and additional investment from Rolls-Royce totaling £300 million across multiple UK factory sites. The government’s National Wealth Fund is expected to create or support approximately 130,000 jobs nationwide by 2030, with an emphasis on using public procurement to boost British businesses and innovation.

While the speech received some support for its focus on jobs and growth, critics remained skeptical. Shadow Chancellor Andrew Griffith accused Healey of offering rhetoric without detailed plans, calling the address “hot air” and criticizing the lack of specifics on tackling the welfare bill, increasing defence spending to 3 percent of GDP, or fostering economic growth. Some analysts pointed to ongoing challenges, such as high energy costs, trade barriers, and skills shortages, as significant obstacles to the government’s industrial ambitions.

Healey acknowledged the difficult fiscal environment, with UK borrowing costs rising amid global uncertainty, including the conflict in the Middle East, which has pushed government debt interest payments above £100 billion annually—exceeding the combined budgets of the Home Office and the ministries of defence and justice. Despite this, he expressed confidence that the upcoming Budget would restore “hope” for young people and businesses while maintaining fiscal responsibility in a challenging economic landscape.