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The Minister of State, Department for Education (Mr Nick Gibb)
May I start by congratulating the hon. Member for Glasgow North West (John Robertson) on securing the debate? I know that he is passionate about the issue—as he said in his opening remarks, education maintenance allowances are close to his heart.
I share the hon. Gentleman’s desire to see more young people, from lower income households in particular, staying on in education and gaining the qualifications they need to contribute to and enjoy the culture of our country and to obtain good employment. I assure the hon. Gentleman that one of the main priorities for the Government is to ensure that our education system is on a par with the best in the world. We want our schools and colleges to prepare their students for success. We will continue to provide support for the most vulnerable young people, so that they can stay on in education.
I acknowledge that the evidence from the EMA pilots shows that the EMA was successful in its early days at encouraging young people to stay on in education. The decision to end the scheme will be disappointing to many young people, in particular to those from the website whom the hon. Gentleman cited in his opening remarks: Nick; Alex, who said that without it he would have “no education” and “no future”; and Cassie Campbell, whom he cited towards the end of his speech and who said that without the EMA she would have to drop out. I will come to that point later in my comments, when I say that they will not have to drop out of education as a consequence of this decision.
We are, today, in a different world. Already, 96% of 16-year-olds and 94% of 17-year-olds participate in education, employment or training. Attitudes to staying on in education post-16 have changed. We are committed to going further still, to full participation for all young people up to the age of 18 by 2015. However, a payment designed as an incentive to stay on is no longer the right way to ensure that those facing real financial barriers to continuing their education get the support that they need. We need to look again at the most effective way of supporting the most vulnerable young people to stay on in education.
Nic Dakin (Scunthorpe) (Lab)
As the Minister might well know, I was the principal of a sixth-form college until fairly recently. I can say from personal experience that the EMA has supported widening participation, the raising of aspiration and greater attainment among young people from a wide range of backgrounds. The EMA has certainly underpinned those developments—it is not an incentive, but an underpinning of continuing in further education. The Minister would be foolish to move away from his statements of only June this year, when he gave assurances that EMAs would continue into the future.
Mr Gibb
I take the hon. Gentleman’s point. There is evidence that EMAs have helped a small number of young people to stay on in education. However, that same evidence suggests that the scheme has a significant deadweight cost. Indeed, pilot evidence throughout the scheme, and more recent research, to which the hon. Member for Glasgow North West referred, from the National Foundation for Educational Research, found that almost 90% of young people receiving the EMA believed that they would still have participated in the courses they were doing if they had not received it.
The fact is, the EMA is a hugely expensive programme, costing more than £560 million a year, with costs of administration amounting to £36 million, but impacting on the participation of only around 10% of the young people who receive support. In effect, the taxpayer has been paying £9,300 for every extra young person who has stayed in education due to EMA. Most of the young people who receive the EMA would have made the same choices and achieved the same qualifications without it.
Simon Danczuk (Rochdale) (Lab)
The research quoted by the Minister has been questioned by other research, some of which has shown that the EMA has increased participation. My point is that it is not just about either/or, and whether the children or youngsters go into education, but it is about supplementing poorer families’ incomes so that they are encouraged to stay in education. It is not whether they go into it, it is helping them a little—with some cash—so that they stay in education.
Mr Gibb
Again, I shall come to that point in just a moment.
The hon. Member for Glasgow North West talked about how successful the EMA has been. I have acknowledged some important positive impacts, but it is also important to look at where the EMA has been less successful. That will help us to develop something that is fairer, more responsive to individual need and more efficiently targeted. Many young people and their parents think that the EMA is unfair and have told me that many people who receive it do not need it, and that some who do need it—the point made by the hon. Gentleman—are not able to claim it.
Andrew Percy (Brigg and Goole) (Con)
The young people in north Lincolnshire certainly needed all the support that they could get when the Labour council put their bus passes up by 500%. It is important that we target support in the right area.
I used to teach in a private school—only for a short period—where there were parents who were paying fees but whose children were still accessing the EMA. I am a big supporter of the EMA and of support for young people, but it is important that that support goes to the people who most need it, rather than through the somewhat scattergun approach we have seen.
Mr Gibb
I am grateful to my hon. Friend for that intervention. I know that some people have seen the EMA as an additional welfare benefit—the point made by the hon. Member for Rochdale (Simon Danczuk)—but it is important to clarify that the EMA has never been a support benefit. It was introduced by the previous Government to incentivise young people to stay in post-compulsory education. It has always been paid in addition to welfare payments. The Government have protected support for families with the lowest incomes and we will continue to support the most vulnerable while ensuring that all sections of society that are able to contribute to the deficit reduction do so. The withdrawal of child benefit from higher rate taxpayers, which will save £2.5 billion a year by the end of the review period, will ensure that people on lower incomes are not subsidising those who are better off.
Mr Gibb
I will not give way to the hon. Lady, because I am running out of time and I want to get to this point: child benefit for families without a higher rate taxpayer will be maintained and will be paid for children up to the age of 19 if they are in full-time education. The Government will use some of the savings from child benefit to help fund significant, above-indexation increases in child tax credit, which will be worth something like £30 in 2011-12 and £50 in 2012-13. That is in addition to the increases announced in the Budget: £150 in a year for 2011-12 and £60 in 2012-13.
I can also assure the hon. Member for Glasgow North West that none of us wants any young person to drop out of education because of financial difficulty. However, we cannot justify continuing to fund a programme that is so expensive, unresponsive and poorly targeted. Instead, we will introduce an enhanced discretionary learner support fund.
Currently, £25 million a year is given to schools, colleges and training providers through a discretionary learner support fund, to enable small payments to young people to help them meet the cost of their education. Colleges value the fund, because they are able to provide support to the young people whom they consider to be in most need. They can also respond to any changes that there might be in a student’s household income during the year. After the EMA is abolished, the fund will be significantly increased over the spending review period. The detail of the future arrangements is still being considered, but we envisage that the enhanced learner support fund will build on the principles of the current scheme to provide exceptional targeted support to students aged 16 to 18 who are experiencing financial difficulties.
Jason McCartney (Colne Valley) (Con)
I thank the Minister for saying that. Students in my patch who go to Greenhead and Kirklees colleges will welcome those announcements that the help will be more targeted. Some of the scaremongering around the EMA can now hopefully be put to one side, and I am pleased to hear that it is all about targeting the help on the students who really need it. I thank the Minister for clarifying that.
Mr Gibb
I am grateful to my hon. Friend for that intervention, because he encapsulated in one intervention everything that I have been saying for the past 10 minutes.
In conclusion, I ask the hon. Member for Glasgow North West to bear in mind the economic background to our decision to remove the EMA. In today’s economic climate, with a budget deficit of £155 billion, the highest of any G20 country, we have a particular duty to ensure that we continue to spend where spending is needed and to get the best possible value for taxpayers’ money. We cannot justify spending more than £556 million a year on an allowance 96% of the recipients of which would have stayed on in education even if they had not received it.
We will, of course, continue to support the most vulnerable and to provide help to those who need it. That is why all schools with children from poorer backgrounds will benefit from the pupil premium. That is why we plan to increase and enhance the discretionary learner support fund once the EMA is abolished.
The Government believe that we should trust the professionals working with young people to make the right decisions. Student support officers in schools and colleges are better able to identify those students who need support.
Mr Philip Hollobone (in the Chair)
Order. We must move on to the next debate.