The Save EMA campaign in responding to the government’s new plans to allow firms and charities to bid for a payment-by-results scheme to try to get “Neet” teenagers into work or training, has pointed out that this money is similar to the amount that should have been spent on EMA.

The government’s plan on 16 and 17 year olds is a smoke and mirrors way for a poor attempt at reversing their policy on EMA, and instead risks wasting more government money.

The average annual payment to EMA recipients receiving £30 a week was £792.01 (over an average of 26.4 weekly payments). The contractors under the government’s new scheme will be paid £2,200 per teenager. When this £126M scheme is combined with the £180m EMA replacement scheme it totals over £300M which is close to what it would of cost to keep the £30 payment scheme for the poorest teenagers.

The steep rise in the youth unemployment rate is what has sparked this government initiative.

The below chart shows the spike that has occurred in the youth unemployment rate for those aged under 17 since EMA was scrapped last September:

• January’s unemployment figures show that since October 2011 Under 17 year-olds unemployment is up by two thirds, that’s a 6% change in increase on the same time period last year.
• For 17 year-olds unemployment in January was up by 4% since October 2011 and 9% since November 2011.

The graph below shows the percentage change each month since October:

The government is right that youth unemployment is a ticking time bomb, something we at Save EMA have said all along, but sadly this government is cutting the wrong wire. This new scheme is a shoddy patchwork version of the EMA that risks costs the tax payer more and does less.

The Education Maintenance Allowance was a tried and tested government scheme. Recognised by a plethora of organizations, like the independent IFS, who argued that EMA help to get those classed as ‘Neet’ into the work place; in contrast this is a shot in the dark, and if anything, it is a smoke and mirrors attempt at trying to correct the mistake of scrapping EMA.
Teenagers need qualifications to enter long term well paid work, this scheme of mop and bucket incentives will not do that. If they are lucky they will get short term low paid work.

For the almost the same amount of money they could of continued the payments of £30 a week like they have done in Scotland and Wales. But scrapping EMA was about the best politics and not the best policy.