Single parents with a disabled child could lose up to £340 a week in benefits if their teenager takes up an apprenticeship – more than the expected £258 weekly salary. Now the government has stepped in with a bursary worth up to £4,500 a year to compensate families for the loss.
The payment, announced by Prime Minister Andy Burnham on Tuesday, is designed to remove a barrier that the Social Security Advisory Committee called a “perverse effect” of the benefits system. The committee warned that the current rules were hampering efforts to cut the number of young people not in education, employment or training (Neet), which official figures put at more than one million 16- to 24-year-olds.
“Parents on benefits can get up to £4,500 a year if their child starts an apprenticeship, as Burnham targets Neet crisis.”
Work and Pensions Secretary Pat McFadden said the bursary was part of a wider package to encourage young people to “earn and learn”. “By providing bursaries to those who need them most and fully funding apprenticeship training, we are making sure cost is not the reason someone misses out,” he said. McFadden added that access to support would come with expectations: “We have an obligation to put good support in place. And then there is an expectation that people engage with the support.”
The £30m pot for the bursaries will be funded through the growth and skills levy, a tax on employers with annual wage bills over £3m. Shadow Work and Pensions Secretary Helen Whately welcomed the focus on apprenticeships but called the plan “uncosted”. “It is spending money already committed elsewhere,” she said. “So, either it is another unfunded announcement, or Andy Burnham is not being straight with us about his plans.”
The announcement follows a recent report by former Health Secretary Alan Milburn warning that one in six young people could be Neet in the next five years without urgent action. Burnham, who has said he is “on a mission” to reduce the number of Neets, acknowledged the scale of the challenge: “The trend is rising at the moment, so the first thing I’ve got to do is to stop that rise.”
Whether the bursary will be enough to stem the tide remains an open question – but for families currently facing a net loss of up to £80 a week when a child chooses an apprenticeship, it marks a significant shift in how the welfare system treats work-based training.
