The Treasury is currently working on a Comprehensive Spending Review, which will outline spending priorities for the next decade when it reports next summer. It is working with departments on a series of smaller reviews that will influence this.
Speaking at a fringe event organised by The National Youth Agency and Young People Now, Hughes said: "The context of the spending review is a very difficult one. There are a small number of priorities. We are going through a process of identifying where we can make savings.There are two or three different priorities, and youth services is a key one."
Hughes said youth services would get a fair slice of any resources available "because we need to make real progress".
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