EDUCATION – FINANCIAL SUPPORT FOR STUDENTS – 15 December 2010

Dr Julian Lewis: I am grateful to my hon. Friend [The Minister of State, Department for Education (Mr Nick Gibb)] for giving way. Does he accept that the two strands of the allowance are becoming intermixed? There is the role of the allowance in persuading people to stay on, and there is the role of the allowance in enabling people to stay on who might otherwise not be able to afford to do so.

A briefing from the Conservative Councillors' Association points out that the staying-on age will be raised, but that will not happen until 2015. What worries people such as the principal of Brockenhurst College in my constituency is that the EMA will stop in September 2011. In the limited time that remains, I hope that my hon. Friend will focus on the transition arrangements, which are of great concern to us all.

[The Minister of State, Department for Education (Mr Nick Gibb): I shall come to that point in a moment.

The fact is that 90% of recipients of EMA would have stayed on in education regardless. Given that evidence, the fact that we have a major Budget deficit crisis and the fact that the programme costs so much each year, it was clearly going to be a candidate for major reform. ...

In reaching the decision to end EMA, we were of course concerned that the 10% of recipients whom the evidence said would have been put off from staying in education but for the money might then drop out of education. We believe that a payment designed as an incentive to participate – a point hinted at by my hon. Friend – is no longer the way to ensure that those facing real financial barriers to participation get the support that they need. .We therefore decided to use a proportion of that £560 million to increase the value of the discretionary learner support fund. Final decisions about the quantum of that extra funding still have to be taken, but we have already spoken of increasing the value of that fund by up to three times its current value, which stands at £25.4 million. A fund of that size would enable 100,000 young people to receive £760 each year. Those 100,000 students represent about 15% of the those young people who receive EMA, which is more than the 10% about whom we are particularly concerned who might not stay on in education. The figure of £760 is more than the average annual EMA paid in 2009-10 of £730, and only slightly less than the £813 paid to 16-year-olds who received the full £30 a week, or the £796 paid to 17-year-olds receiving the full £30 per week. ...]