James Cowling: A new Conservative future must cater to growth, aspiration, and opportunity | Conservative Home

James Cowling is Managing Director of Next Gen Tories.

The Conservatives should be the natural party for voters in the twenties and thirties.

Our instincts to support business, back individuals, and take a long-term view of the country’s finances are fundamentally in favour of young people trying to build a life for themselves.

But with the average Conservative voter now in their sixties, it’s clear we need to reboot our offering, standing four-square behind younger voters and their aspirations. Under Labour, millennials and Gen Z face a doom loop of ever higher taxes to cover ballooning spending. Government debt is now predicted to hit 270 per cent of GDP by 2070, so it is no wonder that over half of young people have considered leaving the UK. Reform has similarly ducked tackling the doom loop, promising unfunded spending commitments totalling close £140 billion.

Now, once again, it is the Conservative Party which must side with these voters, the overburdened drivers of our economy. We need a new approach that stops younger generations footing the bill for spiralling spending, whilst also being more ambitious about pursuing growth. Only then can we get back to an economy where younger voters can accumulate savings, make investments and own their own homes. This pro-growth agenda with young people at its heart is a return to Conservatism at its best, a party explicitly geared towards mass wealth creation for ordinary people.

This vision was no better encapsulated than during Thatcher’s premiership, during which the Conservatives opened up a lead of 4-5 points among 25-34 year olds. The iron lady won over this demographic because her message of individual aspiration resonated with her wider strategy for economic revival. Shaking off the sluggish post-war consensus and vested interests that were hamstringing industry helped young voters thrive in a newly competitive economy. So much so, that the ‘Essex men’ term was coined to define these newly minted capitalists. Whilst today’s challenges are different, there’s a shared theme between then and now – a moment where we must be brave enough to cut the gordian knot and adopt a new economic approach.

The first step is to recognise that the UK cannot borrow, tax and spend its way out of its challenges. Rachel Reeves’s first budget tried this and was roundly thwarted by the bond market. Much of this fiscal pressure is now borne by today’s younger generations, who are paying more in tax than their parents and getting much less in return. Reeve’s inability to shave £5bn off the welfare bill shows that Labour is unserious about responsibly spending taxpayers’ money. We are now borrowing nearly £150 billion a year, of which £110 billion is simply to pay interest.

Similarly, tax hikes on businesses are not a skillful way of passing the pain on without hitting everyday voters. The National Insurance hike for employers was an example of this flawed doom loop logic. This year it will cost businesses £2,367 more to employ a full-time worker on the minimum wage than it did in 2024. Consequently the number of employees on payroll has now fallen in 10 of the last 12 months, with these falls concentrated in hospitality and retail.

Secondly, we need to make it much easier for young people to get on in life, which means that boosting economic growth must be a priority. Given that the baby boomer generation relies on today’s taxpayers to fund pensions and healthcare spending, this is everyone’s problem; if the rider becomes bigger than the horse, no one finishes the race. The Centre for Policy Studies estimates that to offset the fiscal impact of an ageing population, the UK would need GDP growth of around 3% a year, every year, for the next fifty years. The scale of that challenge is significant, so we need to go full tilt.

The unaffordability of rent and declining homeownership is one of the major factors in the drag on living standards.

With the cost of rent outstripping wage growth, young people are accumulating less in savings. Similarly, with deposits on property being higher, young people aren’t investing, forgoing higher returns and starving businesses of scale-up capital. Building more homes and lowering immigration needs to happen in tandem, so that supply and demand come back into kilter. Getting building rates back up will help fuel our economic revival, Policy Exchange estimates that for every 100,000 homes built per year, £17.7bn in direct GDP growth would be added to the economy.

With the right reforms, it’s possible to encourage gentle density in our towns and cities.

These areas have the most acute demand for housing so, logically, we should focus on building in these areas. The UK is a fairly densely populated country, but that density is relatively evenly spread, meaning we have very few areas with high levels of urban density, unlike many other European countries. Labour’s approach is exactly the reverse of what’s needed, by slashing housing targets in cities there has been a collapse in building in the areas with the most acute need. Ridiculously, London is now at the bottom of the building league tables.

It isn’t just housing holding back growth, but the wider difficulty of building infrastructure. Making it easier to build critical national infrastructure projects is one of the fastest ways to boost growth and productivity. Take the delivery of Hinkley Point C, set to be the most expensive nuclear power station in history. As the Shadow Energy Secretary has highlighted, this is not because of the technology – Hinkley is almost 70 per cent more expensive than a project building the very same safe reactor design in Finland. It is, in part, because of our own hyper bureaucracy which is stalling living standards.

If we can get state spending under control and make key reforms to boost growth, a surge in living standards will follow. The headroom to start cutting taxes will then emerge giving young people yet more scope to save and invest. This virtuous circle is possible, and it is a vision of the future the Conservative Party will offer at the next election.

It is a break from the decline offered by Labour and Reform, a vision of hope for the next generation.