Under a new Welsh government basic income pilot, every eighteen-year-old leaving care will be eligible to receive £1,600 per month for two years.
Around 500 people will be eligible for the scheme, which is expected to cost up to £20m – the highest basic income scheme anywhere in the world. The money will be sourced from taxes and will likely be counted as income by the UK government – thereby effecting the recipient’s eligibility for benefits. However, the scheme will be unconditional and will remain in place even if participants get a job.
Welsh ministers hope that the payments will assist care leavers in transitioning into independence as adults. Social Justice Minister Jane Hutt stated that the plans would ‘deliver financial stability for a generation of young people that need it most.’ Welsh Conservatives have described these plans as ‘a waste of money’ while Plaid Cymru hopes to see the pilot scheme expanded.
One teenager who has foster parents spoke to the BBC about the pilot. Milly, aged 17, is a representative of the National Youth Advocacy service on the Welsh Youth Parliament, and says that this pilot could help make care leavers ‘equal with everyone else.’ She added that young people in care were ‘disadvantaged financially’, and that this scheme ‘will bring us level’, acting as a ‘safety net’ for those who may not have other options for financial support.
Young people leaving care at the age of 18 for the first 12 months of the pilot will be offered a place on the scheme, receiving payments for 24 months. This adds up to an income of £19,000 per annum before taxes – the first payment will arrive a month after they turn 18.
However, the scheme isn’t free from criticism. Laura Tams, from Pontardawe, has been fostering for six years. She spoke to BBC Radio Wales about her concerns, noting that ‘these children have been through things that, to you and I, belong in nightmares.
‘We cannot all of a sudden expect them at 18 to be able to run a house and spend that money wisely.’
A Welsh Conservative spokesman for social partnership told the BBC that basic income schemes ‘failed to incentivise work’ and would prove to be a ‘waste of public money.’ Nonetheless, Plaid Cymru spokesman Luke Fletcher maintained that this scheme was a ‘step in the right direction’, but required a ‘structure around it to enable it to meet the ambition of addressing poverty and unemployment.’
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