Parents on Benefits to Get Up To £4,500 for Apprenticeships

A new government initiative will provide financial support of up to £4,500 annually to parents receiving benefits, encouraging their children to pursue apprenticeships. This bursary is designed to compensate families for the Universal Credit payments they may lose when a young person begins an apprenticeship and transitions into paid employment.

Addressing Barriers to Apprenticeships

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The payment is expected to assist a few thousand households who currently face a reduction in benefits ranging from £17 to £330 each week upon their child starting an apprenticeship. This financial disincentive has been highlighted as a significant barrier, potentially impacting young people's career choices. A report by the Social Security Advisory Committee noted the "perverse effects" of the current benefits system on such decisions. For instance, a single parent with a disabled child could lose approximately £340 weekly in benefits if their child commenced an apprenticeship, a sum exceeding the typical apprenticeship wage of £258 per week, as reported by BBC News UK.

Benefit payments are reduced for households when young individuals take up apprenticeships, as these are classified as paid employment. The committee's findings suggest this system hinders government efforts to decrease the number of young people classified as not in education, employment, or training (Neet). Official figures indicate that over one million individuals between the ages of 16 and 24 are currently in this category.

Funding and Government Response

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The new bursary scheme is to be funded from a £30 million allocation drawn from the growth and skills levy, which is a tax applied to employers with annual wage bills exceeding £3 million, as stated by BBC News UK. Work and Pensions Secretary Pat McFadden indicated that the bursaries are intended for those most in need, ensuring that financial constraints do not prevent individuals from pursuing apprenticeships. This measure is part of a broader strategy to bolster apprenticeship opportunities, which includes funding for training for those under 25 and additional support for employers taking on apprentices.

Shadow Work and Pensions Secretary Helen Whately acknowledged the value of apprenticeships but raised concerns regarding the funding of the bursary plan, describing it as "uncosted" and questioning whether it represented new spending or the reallocation of existing funds. Prime Minister Andy Burnham has expressed a commitment to reducing the Neet figures, describing it as a priority to halt the current upward trend, according to BBC News UK.

The government stated that the bursary aims to remove a significant barrier, enabling young people to "earn and learn" through apprenticeships.