Political Monitor OutSource | May 27th, 2025 Edition

Last week, the Prime Minister announced a new economic partnership deal between the United Kingdom and the European Union, as part of a long-planned UK-EU summit. Billed as a ‘reset’ in relations, the deal included a series of agreements in principle for the UK and EU to bring their economies closer together. The deal includes plans for a Youth Mobility Scheme, enabling under-30s to work in the UK/EU for a time-limited period.

Cavendish has distributed a briefing note on the trade deal which can be accessed here. This note emphasises that members will not see any immediate changes, as the detail of each announcement needs to be worked up in the months ahead.

This was in the same week that it was announced that inflation rose unexpectedly to 3.5% in the 12 months to April 2025. This higher figure led to reporting that the Bank of England will only deliver one further interest rate cut this year.

Other Key News

• Levy Support for Postgraduate Level Apprenticeships will be axed with focus on youngest workers: The Government has today announced a major shift in apprenticeship funding from January 2026, cutting support for masters-level apprenticeships to prioritise lower-level apprenticeships for young workers allocating funds Government say from the immigration skills charge price hike.

• There is still a lot of work to be done supporting younger people into work. Analysis has found that the Government is investing less in youth work in England than the previous Conservative administration, prompting warnings from charities that warm words are not being matched by meaningful funding.

• Dramatic Fall in UK Net Migration: The 32% increase in the immigration charge will proceed despite the fact the Office for National Statistics reported that UK net migration fell to 431,000 in 2024, almost halving the 2023 figure.

• Public Sector Pay Increases: An above-inflation pay increase was awarded to NHS workers for the second year in a row, with independent pay review recommendations accepted by the Government. Despite this, resident doctors in England have begun voting on potential industrial action, citing a lack of meaningful Government proposals on pay restoration.

• The Government decided to award teachers in England a 4% pay increase from September, accepting a recommendation from the independent pay review body.