On October 5 and 6, 2025, the Conservative Party unveiled a headline-grabbing proposal: a £5,000 tax rebate for young people entering their first job, designed to help them onto the housing ladder. This "First Job Bonus" is the centerpiece of a broader economic pitch by the Tories as they seek to win back younger voters and present themselves as the party of fiscal responsibility and opportunity, according to reports from BBC, The Independent, and ITV News.
Shadow Chancellor Sir Mel Stride delivered the announcement at the party's annual conference, setting the tone for what he called a “laser-focused” approach to rewarding work and aspiration. As Sir Mel put it, “Helping people to buy a home, build a family, save for the future. That is the Conservative dream. A dream that built my life. It is why I stand before you today, and I’ll fight every single day to make sure that that dream is burning bright for younger people and for the generations to come.” (The Independent)
The plan would see the first £5,000 of National Insurance contributions paid by someone in their first job redirected into a nominated savings account, accessible after five years. Couples could combine their rebates for a total of £10,000, providing a meaningful boost toward a house deposit. The Conservatives estimate the policy would help about 600,000 people per year, with a total annual cost of £2.8 billion (The Independent, ITV News).
Stride emphasized that the scheme’s intent is to “reward work” and help young people build a future. The money would be diverted into a long-term savings account—potentially an ISA—allowing interest to accrue, possibly tax-free. The party clarified that while the proposal is intended to help with house deposits, there would ultimately be no restrictions on how the money could be spent once withdrawn, as reported by BBC.
But the First Job Bonus is only one part of the Conservatives’ economic package. The party also pledged to abolish business rates for high street shops in England up to an annual limit of £110,000—a move aimed at revitalizing retail, hospitality, and leisure sectors. This measure is expected to cost around £4 billion per year by 2029 (BBC).
How do the Tories plan to pay for these promises? The answer, according to Sir Mel and party documents, is a sweeping £47 billion annual savings drive starting in 2029/30. The plan involves:
- £23 billion in welfare cuts, including reducing payments to those with "lower-level" mental health issues such as depression, anxiety, and ADHD, and replacing some payments with treatment programs (BBC, The Independent, ITV News).
- Reducing the Civil Service by around 132,000 staff (about a quarter), saving £8 billion.
- Slashing overseas aid from 0.5% to 0.1% of national income, for a savings of £6.9–£7 billion.
- Ending the use of hotels for asylum seekers to save £3.5 billion.
- Restricting benefits and social housing to UK nationals, yielding £4 billion in savings.
- Scrapping environmental policies, including subsidies for heat pumps and electric vehicles, saving £1.6 billion.
The party says these savings would not only fund the First Job Bonus and business rates relief, but also support other pledges like reversing VAT on private school fees. In his speech, Sir Mel Stride sought to draw a firm line under the party’s recent economic missteps, particularly Liz Truss’s 2022 mini-budget, and to contrast Conservative fiscal discipline with what he called Labour’s “mountain of debt for the next generation” and Reform UK’s “tens of billions in unfunded commitments” (BBC).
Stride did not mince words about his opponents. He accused Reform UK of “marching to the left” on economic policy, with “more spending and more debt.” He told party activists, “We’re the only party that gets it. The only party that will stand up for fiscal responsibility. And that means we have to face some hard truths to which other parties turn a blind eye.” (BBC, The Independent)
Not everyone is convinced. Labour’s communities minister Miatta Fahnbulleh dismissed the plans as “unserious,” telling Times Radio, “They had 14 years in power and in that time they categorically failed to deal with the housing crisis. They broke every aspect of our public realm. So, they can chuck out any ideas that they like. They had their shot and they absolutely messed it up.” Labour Party chairwoman Anna Turley added, “The Tories let welfare bills, civil service numbers and asylum hotel use skyrocket on their watch—and they’ve never apologised. Now they want to rehash failed promises from their failed manifesto to try to solve the problems they caused.” (The Independent, ITV News)
Policy experts have also weighed in. The Institute for Economic Affairs (IEA) welcomed aspects of the proposals but warned the Conservatives not to ignore the “elephant in the room” of age-related spending, especially pensions. Tom Clougherty, IEA executive director, said, “Ultimately, no political party is going to be able to balance the books only by cutting things their supporters don’t like. Long-term fiscal sustainability requires that we engineer a different trajectory for spending on pensions, social care, and old-age healthcare. Without that, other cuts are likely to amount to running to stand still.” (BBC, The Independent)
Despite this, the Conservatives have not committed to changing the triple lock on state pensions, which guarantees that pensions rise each year by the highest of inflation, wage growth, or 2.5%. The Office for Budget Responsibility has warned that this policy may become “unsustainable” in the long term (BBC, The Independent).
Some of the proposed welfare reforms have sparked controversy. The plan to replace payments for people with "low-level" mental health conditions with treatment programs has drawn criticism from disability advocates and mental health organizations, who argue it could leave vulnerable people without adequate support. The Conservatives say these reforms are necessary to “stop young people going straight from school to a life on benefits.” (ITV News)
The party’s approach to foreign aid is also drawing fire. Romilly Greenhill, chief executive of Bond, a network of international development organizations, described the proposed aid cuts as “reckless, short-sighted, and morally indefensible.” (BBC)
Meanwhile, the average price for a first-time home in the UK now sits at £237,600, according to a September 2025 report from Halifax (ITV News). While a £5,000 rebate (or £10,000 for couples) is a start, critics question whether it is enough to make a real dent in the affordability gap facing young buyers.
As the next general election looms, the Conservatives are betting that their blend of targeted tax breaks and tough spending cuts will resonate with young voters and those concerned about the nation’s finances. Whether this ambitious package is enough to restore faith in the party—or to address the deeper structural challenges facing Britain’s economy and housing market—remains to be seen.
