British Chancellor John Healey promised a “new age of industrialization” Monday, setting out plans to steer more government investment toward British jobs, defense manufacturing and apprenticeships while making the case for reducing long-term welfare spending ahead of his first budget.
The speech at the Labour Party conference in Liverpool offered one of the clearest indications yet of how Prime Minister Andy Burnham’s government intends to balance its promise of economic renewal with increasingly constrained public finances.
“Benefits should be a bridge to work, to wider participation, to a better life. Conference, it’s not progressive to allow a bigger and bigger benefits bill, and a system which offers an income but doesn’t offer a future,” Healey said.
Healey took over as chancellor in July and will deliver his first budget on October 28. He enters that test with government borrowing running above official forecasts: Britain borrowed £18.3 billion in August, according to the Office for National Statistics, taking borrowing in the financial year to date to £77.3 billion — £8.1 billion higher than projected by the Office for Budget Responsibility.
Against that backdrop, Healey told Labour members that the government cannot rely on the fiscal conditions enjoyed by previous Labour governments and linked control of welfare spending directly to getting more people into employment.
“So once again, as a Labour government, it falls to us to act,” he said. “And this is more than just an economic must. This is a moral duty. And conference, I refuse to write off a million young people like the Tories have done.”
The focus on young people is significant. Healey has previously said that nearly one million people between the ages of 16 and 24 are not in education, employment or training, with two-thirds having never held a job. He has described reducing youth unemployment as both a fiscal and a “moral duty.”
As part of that effort, the government is expanding a locally run apprenticeship service, with £100 million directed toward programs intended to connect young people with employers and create thousands of additional apprenticeship opportunities.
Healey described the initiative as a more hands-on effort to find businesses that have not traditionally hired trainees.
“A local apprenticeships service expanded to more places, led by mayors, targeted at these young people, delivering thousands more apprenticeships for these young people,” he said. “With local teams, a bit like football scouts for apprenticeships, local teams who will go to local firms that have never taken on a trainee and say, we’ll help you do it.”
“So I want to tell you how we’ll bring back hope, how we will get Britain growing, with hope for our young people, with good work and good jobs and a new age of industrialization. Because conference, I believe in Britain and we believe in it,” Healey said.
Labour is also tying its industrial strategy to national security and defense spending.
The government announced that three new floating docks for the Royal Navy’s submarine fleet at HM Naval Base Clyde in Scotland will be built through a UK-only competition. The facilities will be used to inspect, maintain and upgrade Britain’s current and future nuclear submarines. The wider naval infrastructure program is expected to involve about £6 billion in investment.
The decision is part of a broader attempt by the Burnham government to use public procurement to support British manufacturing rather than treating defense expenditure solely as a national security cost.
Defense Secretary Wes Streeting said the docks would link military investment directly to domestic industry.
“Defense spending should make Britain stronger in every sense. That means backing British by buying British wherever our industry can deliver,” Streeting said in a government statement Monday.
“HM Naval Base Clyde is at the heart of our submarine service. Programme Euston will modernize it for decades to come, while backing British shipyards, workers and engineering.”
“That is defense driving the reindustrialization of Britain and strengthening our sovereign capability.”
For Healey, however, the more immediate challenge comes next month.
His conference message sought to connect three policies that Labour will now have to reconcile in the budget: keeping borrowing under control, reducing pressure from welfare spending and using public money to generate investment and jobs.
That leaves the government attempting to sell fiscal restraint and industrial expansion at the same time — arguing that Britain can spend more strategically even if it cannot simply spend more overall.
related
RAF Fairford Terror Probe: Five British Men Arrested Near U.S. Air Force Base
Five men arrested in a suspected explosives plot near RAF Fairford are all British nationals in their 20s from London, counterterrorism police said Monday, as investigators worked to establish a motive and cautioned against speculation about…
Andy Burnham Pledges Universal National Care Service at Labour Conference
Prime Minister Andy Burnham pledged Sunday to create a universal national care service free at the point of use, putting an overhaul of Britain’s social care system at the center of his first Labour Party conference…
Trump Reacts To UK Arrests Near RAF Fairford
President Donald Trump said Sunday that the United States had been working with Britain in connection with the arrest of several men near RAF Fairford, a British military air base used by the U.S. Air Force.…
