Benefits shake-up needed to reduce youth unemployment, say MPs

The report, by the Children, Schools and Families Select Committee, suggests that government should follow the example of the Netherlands, where benefits are paid to young people for taking part in education, employment or training. The report also urges government to extend initiatives aimed at young people who are Neet in their 20s, instead of just 16- to 18-year-olds.

It warns that many young people looking for work or training need better access to advice on claiming benefits, housing support, or health matters. To meet this need, the report suggests introducing "one-stop shops" with a range of services under one roof.

Barry Sheerman, chair of the select committee, said reducing the number of Neets would be a key challenge for the next government. He said: "The government has to ask itself why the proportion of 16- to 18-year-olds not in education, employment or training has remained at around 10 per cent, despite one policy strategy after another. It is time to take a more radical approach."

Shaks Ghosh, chief executive of the Private Equity Foundation, said there is no silver bullet to the Neets problem.

"To tackle the Neet issue successfully, we have to create a co-ordinated response so our young people are given the opportunity to reach their full potential," she explained. "We strongly support the select committee's call for a seamless, overarching strategy for 16- to 24-year-olds and for a one-stop shop to join up services for young people."

She added that young Neets on benefits must be allowed to carry out unpaid work or full-time volunteering. "The current situation means that the most disadvantaged are effectively frozen out of a whole raft of opportunities because they don't have independent means," she said.

Margaret Eaton, chair of the Local Government Association, said improved co-ordination of local resources would allow councils to do more to support Neets. "Government departments, national agencies, voluntary organisations and local authorities all work to different targets and agendas," she said. "That can muddy the water and prevent a coherent approach to dealing with the issue of young people who aren't working or getting any form of training."