Chancellor Philip Hammond will try to woo Jeremy Corbyn’s “youth vote” by pledging a new railcard for under-31s and more help for students who overpay loans.
On the eve of the Budget, the Treasury confirmed it would extend the current train travel discounts to include 26-30 year-olds and restructure university payments to avoid excess charges.
But Labour dismissed both moves as “too little too late” and called for more radical policies such as the renationalisation of the railways.
Hammond had urged fellow MPs to come to him with policies to win back the millions of young voters who flocked to Labour in the snap general election in June.
HuffPost UK revealed this month that new Mansfield MP Ben Bradley has formed a special group of Tory MPs aged 35 and under to advise the Government on how to reconnect with parts of the electorate who deserted the Conservatives in big numbers.
One Labour source said the Budget moves were “too little, too late” for many young people.
The Treasury said that it would “work with industry” to extend the current youth railcard to include 4.5 million more young people.
It is expected that the card will work on a similar basis to the one for 16-25 year olds, which has existed in one form or another since 1974.
The Treasury said it expected the new card to be available for passengers from next spring, but Labour pointed out that the policy had yet to be finalised with private rail firms.
Shadow Transport Secretary Andy McDonald said the plan “will do nothing for commuters who have seen the cost of travel rise by 27% since 2010, twice the rate of wages”.
“The Tories are tinkering around the edges of a broken system. Our railway should be run by and for passengers, not private shareholders and foreign governments. Labour will take rail back into public ownership, bringing fares down for all passengers and preventing fares rising above inflation, saving the average commuter around £500 over the course of Parliament.”
In another move, the Treasury said that the Budget would also signal an end to the problem of graduates overpaying on their student loans.
A common complaint from graduates repaying their student loan through the tax system is that they often find money continues to come off their wages, even when the full loan has been repaid.
In 2015-16, 86,000 people with a student loan overpaid, and the average overpayment per graduate was £592 – equivalent to many people’s weekly wage.
Now, HM Revenue and Customs and the Student Loans Company are developing a data-sharing system for April 2019, which will automatically stop all repayments once a borrower has repaid in full.
This new announcement follows the Prime Minister’s commitment in October to raise the income level that triggers student loan repayments from £21,000 to £25,000 a year in 2018-19, and increasing this with average earnings thereafter.
Around 600,000 borrowers (with post-2012 loans) are expected to benefit from the threshold changes, helping to secure a better future for the next generation.
Labour said it was pleased ministers had finally listened to its complaints about “the scandal of graduates overpaying” overpayments, but said that paled compared to the wider problems with the system.
“Students are already facing a lifetime of debt thanks to the Tories tripling fees and scrapping grants, so it’s outrageous that some have had as much as £10,000 wrongly taken from them on top of what they owed,” Shadow Education Minister Gordon Marsden said.