Chancellor Rachel Reeves is at the center of a heated debate over Britain’s economic future as she pushes for an “ambitious” youth migration deal with the European Union. With the autumn Budget looming on November 26, 2025, Reeves has publicly urged Prime Minister Keir Starmer and the Labour government to finalize a youth mobility scheme that could open Britain’s borders to thousands of young Europeans. Her goal? To boost economic growth, fill a looming fiscal gap, and potentially stave off painful tax increases or spending cuts.
According to BBC, Reeves described the proposed exchange scheme for young workers as “good for the economy, good for growth and good for business.” The UK agreed in May to work towards a “youth experience visa” with the EU, but the details—such as the number of visas to be issued and the precise terms—are still being hammered out. The plan would allow those aged 18 to 30 to live and work in Britain for up to two years, with no right to remain permanently.
Britain already runs similar programs with 11 countries, including Australia, New Zealand, and Japan. Under those agreements, young people can stay for up to three years, depending on the country, and the UK issued just over 24,000 youth mobility visas in 2024 alone. But the EU scheme, if agreed, could dwarf those numbers. As The Times reports, government sources suggest the new arrangement could allow as many as 50,000 young Europeans to live and work in Britain annually—more than double the current intake under similar schemes.
Reeves’s push comes at a critical juncture. The Office of Budget Responsibility (OBR), Britain’s independent fiscal watchdog, is set to deliver its first economic forecast to the Treasury on Friday, September 26, 2025. This forecast will outline the fiscal gap Reeves must address in her November Budget—a gap that could be anywhere from £20 billion to £30 billion per year, depending on the OBR’s assessment of the UK’s long-term economic performance. The OBR has previously downgraded UK growth by 4% in the wake of the original Brexit deal, citing reduced productivity and business investment.
Reeves is now lobbying for the OBR to factor the potential economic benefits of the youth mobility scheme into its forecasts. “We want the OBR to score it,” she told The Times. “They scored it when we left the European Union. They should score both the improved trade relationships that we’ve negotiated and this youth experience scheme.”
The chancellor’s case is bolstered by recent research. As reported by The Times, studies indicate that if net migration increased by 31,000 a year thanks to a youth mobility scheme, UK GDP could rise by 0.45% over a decade. The House of Commons Library estimates the scheme could be worth as much as £5 billion annually—money that could help close the fiscal gap and reduce pressure for tax hikes.
But the proposal is not without its critics. The Conservative Party and Reform UK have both attacked the plan, claiming it amounts to a partial return to the freedom of movement that ended with Brexit. Nigel Farage, leader of Reform UK, warned that the scheme would “effectively be a back door to free movement.” The issue has become a flashpoint in the broader debate about Britain’s post-Brexit identity and economic strategy.
Public opinion is deeply divided, with Britons voicing a range of views on the proposed Youth Mobility Scheme. As GB News highlighted, some see the plan as a pragmatic way to address labor shortages and strengthen ties with Europe, while others worry it could undermine border controls and the government’s promises to “take back control.”
Reeves, for her part, insists that the scheme is both time-limited and carefully controlled. “It’s around the ages of the young people. It’s around how long they can stay for. And it’s about the number. And all of those things matter for young people and indeed for businesses,” she explained to The Times. She has refused to specify exactly how many visas would be issued each year, but emphasized that the program would not confer permanent residency rights.
Beyond the headline numbers, Reeves is also keen to highlight the reciprocal benefits for British youth. “We have agreed as a government that we want to have an ambitious youth experience scheme to allow young people in Britain to be able to go and work, to travel, to volunteer, to gain experience, to learn languages in European countries,” she said. “And we want young people from those European countries to also be able to come to the UK and have the same opportunities that my generation had to travel and work and study in Europe.”
The chancellor faces a daunting fiscal challenge. The OBR’s expected downgrade of the UK’s productivity outlook has widened the fiscal gap, making it harder for Reeves to keep Labour’s election promise not to increase income tax, National Insurance, or VAT for working people. She remains adamant, however, that she’ll honor those pledges. “Not because I’m obstinate, because they are what provide stability. They are not in conflict with my ambition to make working people better off. They are absolutely essential to making working people better off,” Reeves told The Times.
She has also taken aim at her Conservative predecessors, blaming years of austerity, Brexit without a clear plan, and the fallout from Liz Truss’s mini-budget for Britain’s sluggish productivity. “Unfortunately, the last few years of productivity have been pretty dismal, because the Conservatives — through both austerity, Brexit without a plan and then Liz Truss’s mini-budget — they whacked business investment, and our productivity has been weak, both compared to the past, under the previous Labour government, and compared to other countries around the world.”
Reeves is keenly aware of the risks of losing investor confidence, especially after the turbulence of recent years. She dismissed calls from within her own party to “get beyond being in hock to the bond markets,” warning that a loss of confidence could trigger a repeat of the financial instability seen after Truss’s budget. “Would I like to be less in hock to bond markets? Of course I would. But it is the reality that we rely on those bond markets and those people participating in them to buy our debt,” she said. “When you are issuing still tens of billions a year, you need to maintain that confidence. That’s my job as chancellor, and I take that job very seriously.”
As the Budget deadline approaches, all eyes are on the OBR’s forecast and the outcome of negotiations with the EU. Reeves’s supporters argue that a bold youth mobility deal could be a lifeline for Britain’s economy, while her opponents warn it risks reopening old wounds over immigration and Brexit. Whatever the outcome, the debate over youth migration is shaping up to be a defining issue for Britain’s economic and political future.
