Wes Streeting proposes NI cut and North Sea drilling in Labour leadership positioning
Former Health Secretary Wes Streeting has suggested cutting employers' National Insurance to incentivise hiring young people and backed new North Sea drilling, in a bid to differentiate himself from Prime Minister Sir Keir Starmer ahead of a potential Labour leadership contest. Streeting, who quit the cabinet two weeks ago, told the Sunday Times he favours a targeted NI reduction and expects Energy Secretary Ed Miliband to approve drilling licences for the Jackdaw and Rosebank fields. Work and Pensions Secretary Pat McFadden responded that any tax break must be paid for, while the government points to existing exemptions for under-21s and a £3,000 youth jobs grant.
Former Health Secretary Wes Streeting, who quit the cabinet just over a fortnight ago, has proposed a targeted cut to employers' National Insurance to tackle youth joblessness and backed new North Sea drilling, positioning himself against Prime Minister Sir Keir Starmer ahead of a potential Labour leadership contest.
In an interview with the Sunday Times, Streeting said: "We have to make it easier for business to employ young people and for businesses to take that risk on someone." He added: "I think we should be thinking actively about how to incentivise, whether that's through targeted reduction in employers' National Insurance or other kinds of recruitment and retention incentives."
Labour's 2024 budget raised the rate of employers' NI from 13.8% to 15% and lowered the starting threshold from £9,100 to £5,000, a measure aimed at raising £25 billion a year for public services including the NHS, which Streeting oversaw until his resignation. Streeting did not suggest any cuts to NHS spending in his remarks.
Work and Pensions Secretary Pat McFadden responded to Streeting's proposal, telling the BBC: "Any tax break in this system will cost and has to be paid for." The government points to existing exemptions: employers do not pay NI for workers under 21 unless that person earns more than £50,000 a year. It also offers a £3,000 youth jobs grant to employers for each 18-24 year old on benefits for six months or more.
Streeting's comments follow the publication this week of Alan Milburn's review into the rising number of young people not in education, employment or training (NEETs). Milburn said employers had told him Labour's policies of increasing NI and the minimum wage had disincentivised hiring young people, but noted the Low Pay Commission "has concluded that there isn't one straightforward impact" on youth employment rates from the tax and wage increases.
On energy policy, Streeting told the Sunday Times he expects Energy Secretary Ed Miliband to approve drilling licences for the Jackdaw and Rosebank fields, where applications were submitted before Labour took office. "Yes. I think that's probably where Ed will get to. When he makes a decision, I'd be surprised if that wasn't the case," Streeting said. "The granting of those licences will not necessarily translate into cheaper bills, but it will translate into higher tax receipts."
Streeting has also called for the UK's future to lie "one day back in the European Union" and proposed a "wealth tax", further distinguishing himself from Starmer's government.