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Wales is offering people £1,600 a month as part of a basic income trial

By on June 27, 2022 0

A scheme which will see some young people receive £1,600 a month for two years will start in Wales in days. The trial program, known as the Basic Income Pilot, is designed to help those who were raised transition into adulthood.

The total cost of the scheme will be £20m and an evaluation of the three-year scheme will be carried out, with the Welsh Government saying it will be considered a success if there have been positive improvements in areas such as mental health, well-being, employment or education. Those who qualify can get £1,600 per calendar month (£1,280 after tax) with no restrictions on what the money can be spent on.

Up to 500 people could be eligible, but according to one estimate, around half of them should register initially. The Welsh Government admits it is unclear how many people will take up the offer as some will be better off with existing benefits.

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The Welsh Government says that while each person who receives money through it may receive a different amount, it expects the majority to be better off than if they claimed Universal Credit. For example, an unemployed 18-year-old paying £650 rent to a social housing provider would be around £400 better off than if they were on Universal Credit. The first amount will be paid in August.

Prime Minister Mark Drakeford said: “We want all of our young people to have the best possible chance in life and reach their full potential. The state is the guardian of people leaving care and therefore has a real obligation to support them. as they begin their adult lives Our goal will be to open their world to all its possibilities and create independence from services as their lives develop.

“Many of those participating in this pilot project do not have the support that many people – myself included – were fortunate enough to enjoy as we began our journey into adulthood. Our radical initiative will not improve only the lives of those taking part in the pilot, but will reap rewards for the rest of Welsh society.If we are successful in what we are attempting today, it will only be the first leg of what could be a journey that will benefit future generations.

However, the Welsh Tories say that while acknowledging that care leavers are a vulnerable group who need extra support, “it’s completely the wrong way to go and it may well create more problems than it needs.” ‘solves’. Welsh Conservative Shadow Minister for Social Partnership, Joel James MS, said: ‘It has been proven time and time again that the so-called universal basic income does not work. Look at Finland, which ditched its scheme after two years in favor of a new system which encouraged people to take up employment or take up training.

“We recognize that this is a vulnerable group and that they need additional support – but this is completely the wrong way to go and it may well create more problems than it solves. It’s typical of the job – but obviously giving away free money won’t be a quick fix.”

However, Tiff Evans of Voices of Care Cymru said it was a “brilliant opportunity”. “It is good to see care leavers in Wales being thought of and that the Welsh Government is giving them this opportunity as young people to take responsibility, control parts of their lives and have a chance to thrive and be financially independent.”

Who can get the money?

  • A person leaving care who has reached the age of 18 between July 1, 2022 and June 30, 2023
  • Someone who was cared for by counsel for a period of 13 weeks, or periods totaling 13 weeks, which began after he reached 14 and ended after he reached 16
  • A person leaving care who resides in Wales or who is placed outside Wales but is cared for by the social services department of a Welsh local authority.

Eligible asylum seekers and refugees can participate as long as they meet the criteria and have access to a bank account/building society/credit union. Individuals in custody who would otherwise be eligible for the Basic Income pilot should not participate in the pilot until the calendar month following their release if this is within the 12-month opening window for general pilot eligibility . Young people with additional learning needs will be eligible and should receive support in accordance with existing support procedures.

What’s on offer?

  • Total Basic Income Support will be £1,600 per calendar month (before tax) for a period of 24 months, commencing on the first day of the calendar month immediately following the calendar month in which the beneficiary’s 18th birthday falls. After tax, the amount each recipient will receive per month is £1,280.
  • It will be available to care leavers who reach their 18the birthday between July 1, 2022 and June 30, 2023 and valid for three years.
  • Participants can choose to receive this payment monthly or semi-monthly. It will be paid to them by an external service provider.
  • Participation in the pilot is voluntary and if they are eligible they are already known to their local council who will work with them to assist with any application.

Are there any conditions to the money?

Payment is unconditional without any requirement. The gross payment will be the same for everyone and it will not be changed during the pilot. Payments will be made to individuals, not households. If the person leaves Wales after turning 18, they can still receive the money.

They can leave at any time and the payments will stop in the month following the confirmation of their departure. All eligible recipients will need a bank, building society, or credit union account to receive Basic Income payments.

How to apply?

Eligible persons will be contacted by social services or their young person’s counselor and invited to participate in a program to find out more about the scheme and they can find out more about the registration/payment process and the effects that this could have on their entitlement to benefits. Before starting, they will be invited to meet with an independent advisor.

What about the benefits?

The UK government has confirmed that the Basic Income payment will not be ignored for benefit purposes. All benefit claimants who are also receiving Basic Income payments will need to notify the DWP as their benefits will need to be limited accordingly. An exception to this will be Personal Independence Payments (PIPs), for which recipients of Basic Income Payments will still be eligible, and those living in supported accommodation will still be eligible to apply for Housing Benefit.

By setting the basic income payment at the level we have, broadly in line with the actual living wage, most care leavers will be even better off, even if their entitlement to social benefits ceases for the duration of the pilot.

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