London Councils asks Treasury for devolved skills budget to tackle youth unemployment

London Councils requested a multi-year devolved employment and skills funding settlement in the upcoming Autumn Budget to address a 25% youth unemployment rate across the capital, according to a statement released on October 15, 2026. The cross-party group asked HM Treasury to give local boroughs and City Hall joint control over funding streams to replace short-term funding programmes.

Figures released by the organisation show that 135,000 young people aged 16 to 24 in London were unemployed between November 2025 and January 2026. This gives London the highest regional youth unemployment rate in the UK. Across the country, more than one million young people are not in education, employment, or training, with London accounting for one in six of those individuals in England.

In total, nearly 1.3 million Londoners are currently classed as economically inactive. Among that group, roughly 280,000 people report that they want to work but face barriers to securing employment.

Short-term funding challenges

Local authority employment services in London helped more than 58,000 residents during the 12 months leading to April 2026. Borough initiatives offer assistance with CV writing, job applications, interview prep, and direct engagement with local schools. However, London Councils stated that brief funding cycles create a fragmented system that hinders long-term planning for local communities.

Cllr Kam Rai, Deputy Chair of London Councils, said short-term arrangements restrict long-term investment in local skills.

"We simply cannot afford to let a generation of Londoners get left behind. The capital offers an extraordinary range of career opportunities, but too many Londoners face barriers accessing them."

"Boroughs are already supporting Londoners into work, but short-term funding arrangements make it hard to plan beyond the next year. A devolved multi-year settlement would provide the certainty to invest in life-changing initiatives that connect more Londoners to good jobs across our city."

Trailblazer schemes and government coordination

The proposal highlights five Get Britain Working Trailblazer projects operating across London. These schemes cover interview prep, CV writing, and travel expenses for jobseekers, placing more than 6,000 residents into education, training, or employment during their first year. London Councils requested guaranteed funding for a third year to prevent these programmes from ending when current deals expire next year.

The group also cited findings from the government's interim Milburn Review report, which noted the need for a coherent national system to guide young people into work and training. In addition to devolved funding, London Councils requested closer collaboration and improved data sharing with the Department for Work and Pensions to help local councils direct resources effectively.