Benefits of youth

Ever since the social security reforms of the early 1980s, young people have been singled out for harsher treatment within the benefit system. They have often been excluded from mainstream benefits, the national minimum wage and an adequate income while in education or training. For the 180,000 16 to 19 year olds currently not in education, work or training, that’s a good reason for not taking a course.

At long last, on 17 March the government announced the first steps towards a new approach to young people’s rights.

The most significant long-term measure is a promised consultation on the idea of a single system of financial support for 16 to 19 year olds. This may be modelled on Australia’s youth allowance, paid across the board to people in education, training or low-paid employment.

In the short term, other changes are also proposed. The government has promised to look again at the rule that stops benefits from being paid to young people who are estranged from parents and living independently once they reach 19.

A new national minimum wage of £3 an hour is being considered for 16 and 17 year olds from October 2004. The government also intends over time to establish a minimum income of £70 to £80 a week for people who are working and training.

By spring 2005, the Department for Work and Pensions also intends to rewrite the existing restrictive guidance on “severe hardship” and estrangement.

And before this, from September 2004, there will be a national scheme of education maintenance allowances (EMAs). These are crucial for those aged 16 to 19, and could well make the difference to the education stay-on rates that the government is looking for.

Some pupils will receive £30 a week for staying in education beyond GCSEs. The really good news is that EMAs are extra money. In other words, they don’t count as income if the young person or their family are receiving means-tested benefits or tax credits. It is also paid directly to the young person.

The amount of EMA depends on family income. With income up to £19,630, the young person will get an EMA of £30 a week. As income rises, the EMA falls. So, if income is between £19,631 and £24,030, the EMA will be £20. It falls to £10 as income rises to £30,000; more than £30,000 and no EMA is paid.

On top of the weekly payments, there will be termly bonuses of up to £500 a year for regular attendance and performance (as determined by teachers and tutors).

Looked-after young people and care-leavers will qualify for the highest rate of EMA. This is very significant if we are trying, as corporate parents, to encourage more young people to stay on beyond Year 11. With half of looked-after children leaving care with no qualifications whatsoever this can only be a good thing.

The Care to Learn scheme is also available for young parents (16 to 19) in education who use and pay for registered child care. This can be worth up to £5,000 a year. So a 16-year-old lone parent (looked-after or not) who stays on beyond Year 11 could get income support, tax credits for the child, an EMA and Care to Learn.

For more on EMAs, call 0808 1016219; for Care to Learn call 0845 600 2809.

Gary Vaux is head of money advice, Hertfordshire Council. He is unable to answer queries by post or telephone. If you have a question to be answered, please write to him care of Community Care.