Guidance about the scheme to help care leavers receive a set amount of money from government to cover basic needs.
Basic income policy design
Who is eligible for the basic income for care leavers in Wales pilot?
Individuals will be eligible for this pilot if they are:
- a person leaving care turning 18 years of age between 1st July 2022 and 30th June 2023
- a person who has been looked after by a local authority for a period of 13 weeks, or periods amounting in total to 13 weeks, which began after he or she reached 14 and ended after he or she reached 16
- a person leaving care who is resident in Wales, or who is placed outside of Wales but is supported by a Welsh local authority’s social services department
There may be certain situations where a person in specific circumstances but otherwise meeting the above criteria may find their participation in the pilot more challenging than most.
Why is the pilot focusing on care leavers?
The Welsh Government is fully committed to supporting those living in poverty, ensuring they receive adequate financial support so that everyone in Wales can live happy and healthy lives. However, the scale of the basic income pilot will need to be something that we can manage and afford.
Care leavers have a right to be supported as they develop into independent young adults. Yet, too many young people leaving care continue to face significant barriers to achieving a successful transition into adulthood. Basic income is a direct investment in this cohort of young people, giving them the space to thrive whilst securing their basic needs.
The reason we propose working with this cohort over any other groups who typically face poverty and other forms of disadvantage, is to understand the unique challenges care leavers themselves face and whether extending the time they are supported could have a positive impact on their entry into adulthood. We will use these insights to test how cash payments and system re-engineering could better help them to live the kind of lives they want to lead.
Care experienced young people are a group that the Welsh Government has consistently chosen to invest in, for example, the top up of the Child Trust Fund payment; additional Council Tax exemption and establishment of the St David’s Day Fund. It is recognised that, compared with their peers, care-experienced people are disproportionately disadvantaged and are statistically more likely to experience issues such as homelessness, addiction and mental ill-health.
The purpose of the pilot is to build on the existing support offered to care experienced children in Wales and ensure young people who take part in this pilot get all the support they need to give them the best possible chance to make their way in life and the transition out of care better, easier and more positive.
Why is the pilot focussing on care leavers turning 18 years of age during a 12-month timeframe?
Added support soon after turning18 years of age could provide a more solid foundation for care experienced young people from which to build their adult lives.
At 18 years of age, all recipients are legally adults and in full scope of the benefits system. As the local authority will have performed the function of corporate parent up to this point, we expect the cohort will remain in contact with and supported by their local authority social services team.
Running a time limited pilot will enable us to evaluate and assess the impact of the policy on the group of young people and offer wider insight into value of basic income as an approach.
How much is this going to cost?
Ministers have allocated £20m to the delivery of this pilot over the course of 3 years.
Are there any conditions?
The payment is unconditional with no requirements attached. The gross payment will be the same for everyone and it will not be altered during the pilot. Payments will be made to individuals and not to households.
What happens when the pilot ends?
The Welsh Government believes that taking this approach to supporting those leaving care will put the young people who participate in a better place to navigate what comes after the pilot and the next stage of their lives.
The pilot is also being designed to enable recipients to receive more than just a basic transfer of money; additional support will be offered that is designed to build up their confidence to negotiate the world outside of care.
Recipients will receive access to individual financial advice and support, signposting and additional support relating to well-being, education, work, as well as broader financial advice.
The pilot will be evaluated and will include responses and feedback from the recipients and stakeholders around both the effectiveness and the administration of the basic income. This continuous evaluation and feedback will inform how we support recipients as their two-year period in receipt of a basic income ends.
Is there a risk that some care leavers will not work or seek education during their 24 months payment? Will this leave them behind and then back to square one?
We know from international trials, experiments and pilots of basic income that very few people disengaged entirely from education, employment or training. Indeed, some take the opportunity presented by the security of basic income to start their own businesses or return to education, or it gave them the confidence to seek out higher paying, more secure jobs.
That said, we are aware that the Welsh offer is a significantly higher amount than offered in other international examples, so we will need to be mindful of the learning from our pilot as it progresses, which is one of the reasons we are taking an action-learning approach to evaluation and monitoring. It will therefore be important in our ongoing communication with the recipients to reiterate that this is a pilot lasting no longer than 24 months and provide them with the necessary information and support for them to make informed life choices according to their circumstances and ambitions.
We are also linking the offer of the basic income support with other Welsh Government policy initiatives, such as the Young Person’s Guarantee. This is the Welsh Government’s key commitment to everyone under the age of 25, living in Wales, with support to gain a place in education or training, and help to get into work or become self-employed.
How many people are expected to receive this payment?
It is our intention that all young people leaving care who turn 18 years of age during a 12-month period, across all local authority areas, will be offered the opportunity to take part in this pilot.
The pilot will begin on 1 July 2022 and we expect over 500 young people will be eligible to join the scheme. Participation will not be mandatory, therefore exact numbers will be unavailable until the 12 months participation timeframe concludes. Those delivering the pilot will begin to contact eligible recipients over the coming months to fully inform them about the pilot, what it means for them, how they can take part and what additional support will be available to them. If at this point the individual does not wish to receive the basic income pilot payment, they do not need to apply.
Why aren’t we doing a geographically-based basic income?
The policy driver for our pilot is to support care leavers to make the most positive transition from local authority care, using basic income as the means to achieve this.
Basic income is the mechanism rather than the purpose of our programme, but we see our pilot as a contribution to a global movement. There are around 80 basic income trials of diverse types taking place across the world. Each has its particular focus, and all offer important learning about what a basic income may offer in terms of benefits and challenges.
It is not necessary for Wales to undertake all this experimentation for itself. We can contribute the learning from our work and draw learning from work around the world.
Will existing funding be stopped e.g., St David’s Day fund?
No. The basic income is in addition to existing support provided by the Welsh Government that is available to this cohort in Wales. Furthermore, we would expect local authorities and other external providers to continue to offer localised support to this cohort as they would normally. The basic income pilot should not see any reduction in support offered or provided.
What contingencies are in place if things go wrong?
We hope that recipients of the basic income support will find it a positive, life-enhancing opportunity, and a platform from which to springboard into a successful adulthood. Basic income as an approach is about providing individuals with the income security to enable them to make choices based on their individual ambitions, desires and circumstances. Nevertheless, we know that some may find it challenging to be in receipt of such support, and therefore constant dialogue between those delivering the scheme and those individuals in receipt of its support is essential.
Ensuring all young people can make an informed choice about their participation, from the outset and in ongoing engagement, is essential. This information and associated discussions should reflect everyone’s personal circumstances so that the individual can make an informed choice about their next steps. Recipients should also be reminded how many months of support remain at every opportunity, so that there is not an unexpected ‘cliff-edge’ at the end of the pilot, and they can plan accordingly.
Support that would otherwise be provided to this cohort should also remain in place, basic income is not a replacement for existing support provision. The same safeguarding approaches and pathways should remain for the basic income recipients as would otherwise be in place for any care leaver aged 18.
It is also worth remembering that participation in the pilot is not compulsory. Should a young person wish to withdraw from the pilot, they can do so. However, for the purposes of the pilot, this would be a final decision and they would not be able to re-join at a later date.
Who will deliver the basic income for care leavers in Wales pilot?
A range of organisations and professionals will play a vital role in delivering different aspects of the basic income for care leavers in Wales pilot. These include local authorities, the third-party payment provider, Young People’s Advisors, and third sector organisations.
What will you do if those receiving basic income move out of Wales?
If the recipient meets the three criteria outlined above and is supported by a Welsh local authority’s social services department until they are 18, they will continue to receive the basic income irrespective of where they choose to reside after their 18th birthday.
What happens if local authorities have placed a care leaver in England? Would they then be ineligible for the pilot?
Where these are young people supported by local authorities in Wales, they will be eligible for the pilot as they should not be disadvantaged because their placement is elsewhere.
Will there be any restrictions on how recipients spend the money?
There will be no restrictions on how people choose to spend their basic income payment.
Evidence from all the trials to date indicate that people spent their funding appropriately.
Signposting and additional support will be used to encourage recipients to make positive choices.
Who will deal with potential complaints from other care leavers who do not meet the criteria due to age/roll-out? For instance, it could result in loss of relationships/engagement if one sibling in the family receives it, and the other does not.
As with all pilot scheme design for any policy innovation, there is a limited eligibility criteria and timeframe so that the policy can be appropriately assessed to determine whether it works. In all communications to date about this pilot, it has been clear that this is for a limited cohort over a limited timeframe. It is important that those who support care-experienced young people clearly communicate the eligibility criteria throughout, to avoid any misconceptions or misinterpretations.
Is there an expectation that service providers are keeping a record of how the young people are spending this money?
No, although this may be a part of the research conducted alongside this pilot, more details of which will follow in the coming months.
Applying to join the pilot
How do eligible recipients apply?
The young people who will be eligible to take part will be contacted by social services or their Young Person’s Advisor and invited to take part in an engagement programme with advisors to find out more about the scheme.
Eligible applicants will be invited to attend sessions where they will have the opportunity to discuss the enrolment/payment process and the effects this could have on their benefit entitlement.
Enrolment will involve a young person confirming their consent to join the pilot, completing a series of questions in line with equalities monitoring, and providing their payment account details for receipt of payments.
What advice will be given to care leavers before signing up?
Prior to any decision about joining the pilot, eligible applicants will be invited to attend sessions with an independent advisor where they will have the opportunity to discuss the application/payment process and the effects this could have on their benefit entitlement. This will enable them to make an informed choice about participation.
The discussion will include information about benefits, education, employment and the wider package of support.
Do service providers put forward names for suitable care leavers or are they all picked at random?
There is no random selection of eligible recipients. If a young person meets the eligibility criteria, they are eligible to participate in the pilot.
Is it mandatory for eligible recipients to apply and receive the payment?
If eligible applicants do not wish to receive the basic income pilot payment, they do not need to participate. Everyone who is eligible will have chance to find out more about the scheme and to make an informed decision on whether to participate in the pilot.
If there is a young person who is considered ‘at risk’ for whatever reason by their Young Person’s Advisor, can they be prevented from signing up to the pilot?
As a point of principle, all of those who meet the eligibility criteria should be entitled to sign up to the pilot if they so choose. Basic income should be treated no differently to any other form of income; we would not, for instance, prevent those leaving care from earning a wage or recommend that they do not sign up for Universal Credit if entitled to do so. Existing safeguarding procedures should be followed as standard, and tailored support and guidance should be offered in line with the perceived risk.
What is the cut off for people to apply?
Eligible recipients interested in taking part in the pilot will have to apply in time for the first payment after their 18th birthday, so that payments can begin from the month following their birthday. To ensure effective programme budgeting and day-to-day management, we are unable to offer the pilot to people applying to join later.
Can a recipient choose to leave the pilot before their 24 months participation concludes?
Yes. Should a recipient wish to leave the pilot, they can do so at any time. Their departure from the pilot will be noted accordingly and payments will cease in the month following confirmation that they wish to leave. Anyone choosing to leave the pilot early will not be able to re-join at a later date.
Care leaver cohort details
What are the outcomes for care leavers?
Typically, outcomes for care experienced young people are less positive than for those young people who live at home with a parent or parents. We know that care experienced young people are less likely to achieve good educational qualifications, have greater health and housing needs, are more likely to become involved in substance misuse and engaged within the criminal justice system.
Care leavers are often required to live independently much earlier than their peers who have not been in care. Data from 2021 shows that whilst 19% of care leavers returned home to live with their parents or someone with parental responsibility, there were many young people who were living independently or semi-independently with a varying range of support.
Leaving care to live independently or semi-independently at such young ages can be a daunting prospect. The Welsh Government is committed to supporting young people, helping them to access opportunities and choices so they can flourish and realise their potential.
In addition to our Programme for Government commitment to pilot an approach to basic income, we are strengthening public bodies in their role as ‘corporate parents.’ This means raising awareness and understanding throughout the public sector about our shared responsibility to support children and young people who have experience of being in care. For those leaving care, we have a duty to help them transition successfully to independent and economically active young adults. We see our basic income pilot as a clear demonstration of our commitment to support young people leaving care and helping them to a positive start in adult life.
Does international basic income evidence reference learning about care leavers?
Most basic income pilot schemes focus on general populations or other specific population groups. For those pilots focusing on general populations, care experienced people may well be recipients of the basic income, but this is not an explicit feature of any learning to date.
A scheme launched in July 2021 in the Santa Clara County of California is focused on care experienced young people transitioning out of foster care at age 25. Recipients in this scheme receive $1,000 per month and is currently scheduled to run until March 2023. This is now being expanded across California, for 2,500 recipients.
Although there are clear distinctions in both context and approach, learning from both the Wales and Santa Clara schemes will build an evidence base for basic income for care experienced young people, and the policymakers in Wales and Santa Clara are working together to share learning across both jurisdictions.
Payment amount, welfare and taxation
How long will eligible recipients receive the payment for?
Eligible recipients will receive a basic income payment for 24 months from the month after their 18th birthday.
For illustration purposes, if a young person leaving care turns 18 in July 2022, they will receive their first payment in August and will continue to receive this payment on a monthly basis until July 2024.
How much money will eligible recipients be entitled to receive through the basic income for care leavers in Wales pilot?
Participants in the pilot will receive 24 months’ worth of payments at a value of £1600 per month, pre-tax. HM Revenue and Customs (HMRC) and the Department for Work and Pensions (DWP) have confirmed that the payment will interact with the tax and benefits system and will be recognised as income.
How will participation in the basic income for care leavers in Wales pilot interact with the tax and benefits system?
The UK Government has confirmed that the basic income payment will not be disregarded for benefits purposes. Any benefit claimants who are also receiving the basic income payments will need to make the DWP aware of that fact, as their benefits will need to be restricted accordingly. An exception to this will be Personal Independence Payments (PIP), for which recipients of the basic income payments will still be eligible, and those in supported housing will still be entitled to apply for Housing Benefit.
By setting the basic income payment at the level we have, broadly in line with the Real Living Wage, most care leavers will still be better off, even if their entitlement to welfare benefits ceases for the duration of the pilot. Ensuring care leavers have clear advice about the impact of the basic income pilot on their specific circumstances to enable them to make an informed choice about whether to participate will be a critical part of the pilot.
In relation to taxation, the gross payment amount of £1600 per month is taxable at the relevant basic tax rate. This will be taxed at source, that is before the participant receives their payment. Each recipient’s overall tax payments will vary according to any other income earned, with the basic income payment to be declared as additional income received. For those who do not earn additional income, they may be entitled to a tax refund. Support will be provided to help the young people claim any tax refunds through the financial advice and support service.
We recognise that, in gross terms, we have set the payment at a level significantly higher than any other basic income pilot globally has offered to individuals. However, it is broadly in line with the Real Living Wage, and we intend this level of payment to make a significant and positive change to the recipient’s lives.
How will recipients get paid?
All eligible recipients will require a bank, building society or credit union account to receive the basic income payments.
At enrolment, young people will disclose their account details, which will be passed to the payment provider.
Will eligible recipients still receive passported benefits?
Eligible recipients who receive welfare benefit payments or tax credits can also be eligible for passported benefits - passported means that these benefits have one or more UK Government welfare benefits among their eligibility criteria.
Passported Benefits in Wales cover areas such as Health, Housing, Higher Education Student Support, Schools (including Free School Meals, School Uniform Grant, and help with paying for school residential trips), Transport, and Energy.
Under the pilot, recipients will still receive any Welsh benefits that they would be entitled to had they not been on the pilot.
Is the payment reducing DWP costs in Wales for those who would otherwise receive Universal Credit?
This may be the case for some recipients. We remain committed to the pilot despite the displacement of cost to the Welsh Government.
I noticed the payment will be treated as income for tax and benefit purposes - will they have to report that separately? Will they therefore pay tax from first £ of earnings etc.?
HMRC and DWP have confirmed that the payment will interact with the tax and benefits system and will be recognised as income.
The payment will be taxed at source, that is before the participant is paid and the participant will receive the net or ‘after tax’ amount; currently £1,280.00.
The UK Government has confirmed that the basic income payment will not be disregarded for benefits purposes. By setting the basic income payment at the level we have, broadly in line with the Real Living Wage, most care leavers will still be better off, even if their entitlement to welfare benefits ceases for the duration of the pilot. Ensuring care leavers have clear advice about the impact of the basic income pilot on their specific circumstances to enable them to make an informed choice about whether to participate will be a critical part of the pilot.
Will this count as income if a young person wants to apply for something requiring income declaration e.g., a mortgage?
Yes. In all situations where declaration of income is necessary as part of the application process, the basic income payment must be declared as income. How this is to be declared will differ amongst the type of application, but commonly used field terms will include phrases such as ‘additional,’ ‘other’ or ‘unearned’ income.
Will they still get a National Insurance (NI) contribution record during the pilot?
It will depend on the individual circumstances of the recipients; some recipients will still go on to work during the pilot, some may start their own businesses, and some may still receive benefits, which will register NI contributions, whilst others may have a gap in their record, for instance if they remain unemployed and were not claiming benefits or self-employed but did not pay contributions because of small profits.
The basic income payments alone do not constitute “earned income” under the Social Security Contributions and Benefits Act 1992 and, consequently, HMRC has confirmed that the payments are not liable to NI deductions. This also means that, unless the recipient contributes through other earned income or chooses to make a voluntary NI contribution, they may have a gap in their NI contribution record, which may slightly disadvantage them for benefits or state pension purposes later in life.
Given the age of this cohort and duration of the pilot. The Welsh Government do not anticipate this being a significant concern for their long-term NI contributions. The potential impact of this will be a key factor to highlight on a case-by-case basis as the eligible cohort decide whether to be part of the scheme, and throughout in ongoing support to the recipients.
Even though young people participating in the pilot and out of work would not qualify for Universal Credit (UC), they will still be able to register with their local Jobcentre Plus office as unemployed. If they demonstrate they meet the ‘available for’ and ‘actively seeking work’ conditions, they will receive a Class 1 NI credit (for each week they meet these conditions). This would also mean that they can access the employment/training related advice and support that is available from Jobcentre Plus.
Information on how to make voluntary NI contributions, should the recipients wish to do so, is available via the GOV.UK website. Further information about eligibility for NI credits is also available via the GOV.UK website.
What happens at the end if they have to apply for Universal Credit and wait for Universal Credit to be paid?
Preparing for the end of the pilot is as important as starting the pilot. Recipients will be regularly reminded of their end point on the pilot so that appropriate plans can be made for their transition out of the pilot.
Independent financial advice and support will be available to participants for the duration of the pilot. Planning for what happens at the end of the pilot will be a significant part of this advice.
Will basic income for care leavers in Wales pilot recipients risk being sanctioned by DWP at the end of the pilot if they have voluntarily left work during or not worked at all during the pilot?
A person who claims UC can face a high-level benefit sanction if they are deemed to be voluntarily unemployed. The DWP has confirmed that they would consider a person as voluntarily unemployed if, in the past three months before they make their UC claim, they left their employment without good reason.
Should a young person need to claim UC when they stop receiving the basic income payment, they should not be voluntarily unemployed, whereby they had chosen to quit their job(s) in the final three months of their receipt of basic income payment. A young person will be encouraged to seek impartial advice before taking the decision to leave their employment.
If recipients spend the basic income payments all in one go, would local authorities and others be obliged to still provide financial support, food parcels / utility payments to support them if they run out of money?
There should be no reduction of existing support because of the basic income pilot. If young people would otherwise be entitled to such support on top of other forms of income received (e.g., welfare benefits, earned income) then this support should continue to be available to them.
Will the recipients be made to open a savings account to save some of the basic income payments e.g., with a monthly fixed payment going in?
No. There should be no compulsory requirement to open any type of account, with the exception that all recipients will require a bank, building society or credit union account to receive the payments. Through the financial education support and additional information and guidance, recipients will be supported and encouraged to make the best use of their basic income payments according to their need and ambitions.
Is the basic income payment reduced if working and earning a wage?
No. The basic income payments will remain £1600 pre-tax throughout a young person’s participation in the basic income pilot.
Is the payment risk-assessed per individual?
No. The payment level will remain the same for all recipients. As a point of principle, all of those who meet the eligibility criteria should be entitled to sign up to the pilot if they choose to. Basic income should be treated no differently to any other form of income; we would not, for instance, prevent those leaving care from earning a wage or recommend that they do not sign up for UC if entitled to do so. Existing safeguarding procedures should be followed as standard, and tailored support and guidance should be offered in line with their perceived risk.
Can basic income payments be used to support an internship?
Yes. Recipients should be encouraged to make use of the payment as appropriate to their needs and ambitions. As part of the broader information and support offered alongside this pilot, young people and service providers should be signposted to the Welsh Government’s Young Person’s Guarantee, which is designed to support young people gaining a place in education or training, get into work or become self-employed.
Is there the possibility for housing costs to be deducted at source?
Yes. Participating care leavers will be able to choose whether to receive their payments monthly or twice a month and will have the option to request that rent payments are made directly to landlords. This mirrors arrangements that can be put in place with UC.
However, the general guiding principle of basic income to be unconditional, so that individuals are empowered to use the support as they deem appropriate, must remain; as such, it must be their explicit choice to ‘opt in’ for housing cost deductions, with the recognition that once the pilot concludes, they will be responsible for housing payments in the future.
Will people in supportive living be disadvantaged? Costs are high. Could rent be paid and then the basic income payment?
Owing to the impact participating in the basic income for care leavers in Wales pilot may have on an individual’s entitlement to UK Government-led benefits, this may be a concern affecting participation in this pilot, depending on the individual’s supported housing costs.
In line with the general principles of this pilot, if a participant will not be better off by taking part in the pilot, and existing support provisions are a better choice, then they should not take part in the pilot. Case studies and scenarios to illustrate the choices available to those affected will be included in the overall delivery guidance.
Will they still receive setting up home allowance during this period?
All existing support provided by the Welsh Government or Welsh local authorities that is already offered to care leavers in Wales, or to those supported by Welsh social services, will remain in place.
If a basic income pilot participant starts receiving their payment a month after their 18th Birthday, how will they manage for the first month (the month they turn 18)? Who will pay their rent for this month as Universal Credit / Housing Benefit would cover this?
If a participant in the basic income pilot is currently receiving support towards their housing costs, this will continue as entitled until they receive their first basic income payment. Once they have received their first basic income payment, if they were receiving welfare support, DWP will need to be notified of the receipt of basic income support and it is likely that the DWP support will cease.
If a participant has never claimed UC prior to their 18th birthday, the local authority is encouraged to meet living costs and not request the young person makes a UC claim for this period. This may include payment of rent, supported housing costs and a weekly allowance. However, this process will be determined by the existing process in each individual local authority when a care leaver begins to receive UC.
How best can we support those with existing substance misuse issues?
No eligible care leaver is to be prevented from taking part in the pilot should they make an informed choice to do so. Local authorities will support young people to consider if participation in the basic income pilot is the right choice for them.
Local authorities as corporate parents have duties to continue to support care leavers, this will include identifying any safeguarding issues such as substance misuse and supporting young care leavers with these issues. We would expect that any existing safeguarding measures and support local authorities already have in place as part of their ongoing duty of care to care leavers, will be followed and made available to basic income participants.
Criminal justice and custody
What will you do if those receiving basic income are imprisoned?
Those currently experiencing a custodial sentence who would otherwise be eligible for the basic income pilot should not participate in the pilot until the calendar month following their release from custody if this is within the opening 12-month timeframe for general pilot eligibility. They will then receive whatever number of months would be remaining should they have entered at 18.
Anyone receiving a custodial sentence whilst participating in the pilot will have their payments suspended from the month that they enter custody (i.e. they will not receive any payments remaining due that month or any subsequent month that they remain in custody). Should a young person’s period in custody cease whilst the pilot is still running, they can re-enter the pilot to receive the remaining months from their original 24-month allocation. A pathway for how those delivering the basic income pilot will be notified about a custodial sentence will be developed in conjunction with care providers and Youth Offending Teams.
Housing-related costs will be mirrored for those on remand or serving a custodial sentence during the pilot in line with current housing benefit arrangements.
Guidance and pathways for those exiting custody and into pilot will be developed in partnership with the Integrated Offender Management team, Prison Group Directors, and Probation Service.
Additional learning needs
Will young people with additional learning needs or subject to appointeeships or deputyships be eligible and if so, how will they be supported?
Young people with additional learning needs will be eligible and should receive support in line with existing support procedures.
Local authorities and others supporting the young person (e.g., advocates, appointees) will determine whether any young people subject to deprivation of liberty and mental capacity orders would be better off participating in the scheme or not on a case-by-case basis; they may be financially better off with existing welfare provision.
If a young person exits their Order after their 18th birthday but still within the 12-month enrolment timeframe, they can enter the pilot for the remaining number of months to which they would have been entitled.
Existing safeguarding procedures remain in place and should apply to those who may otherwise be eligible to participate in the pilot.
Unaccompanied asylum-seeking children
Are unaccompanied asylum-seeking Children (UASC) eligible to participate in the pilot?
In line with the Welsh Government’s Nation of Sanctuary approach, eligible asylum seekers and refugees are to be permitted to participate in the scheme, so long as they meet the general eligibility criteria and have access to a bank/building society/credit union account.
Guidance on how to access banking services for refugees is available from the Refugee Council.
Will the basic income payment affect eligibility for student finance?
For those who apply during the pilot timeframe, eligibility for student finance for the majority of recipients should not be affected – in line with student finance eligibility generally, young people leaving care will require a letter from a social worker or support worker as confirmation that they are leaving care and confirming their period in care when applying for student finance. It is important to remember that each application for student finance will be considered on an individual basis, so any additional income e.g., savings or earned income, or household income through marriage or co-habitation, may affect their application. The basic income payments received will need to be disclosed as income on applications where required.
Others who may apply for student finance in later years through the ‘independent status’ route must prove three years’ worth of income for the time prior to their application for student finance. As the basic income is classed as earned income, the basic income payments received in those years would need to be disclosed, along with any additional earned income. This may affect eligibility depending on the total amount earned.
Further general information about student finance for self-supporting students can be found via the Standalone website, and Student Finance Wales provides information for independent and estranged students.
How will success be measured and evaluated?
The intention is to provide a rich, insightful, and multi-faceted evaluation. However, it is worth noting at the outset that many of the longer-term impacts will take some time to manifest and so will not be possible to measure during the pilot.
The proposed evaluation design consists of process/implementation, impact and value-for-money elements, in order to consider whether and how the basic income has enriched the lives of the care-experienced young people. This will be achieved by commissioning two separate but integrated pieces of work:
- a combined process and impact evaluation employing a mix of qualitative and quantitative methods
- an in-depth qualitative ethnography study. The work is concerned with both the experience and the effectiveness of the basic income pilot
An essential element of the monitoring and evaluation work is gathering the baseline data. This work needs to begin ahead of the pilot start date and throughout the delivery of the programme. The purpose of the baseline information is to assess the impact of the basic income pilot and to compare what happens before and after the programme has been implemented. Without baseline data, it is difficult to estimate any changes or to demonstrate how the pilot has impacted on the lives of the young care leavers and whether the programme has enriched and enhanced their lives. Officials are exploring an option to work with a charity/university partnership experienced in undertaking surveys with care experienced young people to undertake this work.
Will we be able to infer anything from care leavers about Universal Basic Income more generally?
Yes, it will offer some insights and other experiments around the world have some form of targeting or conditionality attached. Each offers valuable insight into what a basic income or a universal basic income offers.
This is a targeted experiment and clearly not all the outcomes would apply to the general population. Nevertheless, it is still likely to provide valuable information and insights for the future about how the concept of basic income could apply to other groups more widely, with its design and implementation testing some of the principles of basic income.
I would like to evaluate the basic income for care leavers pilot, how can I register my interest?
It is our intention to commission an evaluation of the basic income for care leavers pilot via open competition and so we would recommend that interested parties ensure that they are registered on the Dynamic Procurement System that we use to advertise our contracts.
Signposting and additional support
What support will be provided to the recipients?
Care leavers who choose to participate will be offered access to independent quality assured financial advice and support throughout their engagement in the pilot.
To ensure there is a consistent approach to the level of advice and support recipients are provided with, a package of financial advice and support has been developed. This package expands the Welsh Government’s Single Advice Fund (SAF) grant agreement, currently held by Citizens Advice Cymru. The service will provide direct advice to young people and ‘second tier’ advice support to local authority professionals working with young people. This will include advice at all stages, from working through a pre-pilot ‘better-off calculation’ to budgeting advice or financial crisis support. Care leavers will be able to access impartial advice tailored to their individual circumstances, and a single lead organisation will ensure consistency of service delivery throughout Wales.
In addition to the individual financial advice provided to recipients of the basic income, other organisations such as Voices from Care and the Money and Pensions Service will deliver more holistic advice around money management, education, training and wellbeing. Recipients will be signposted to these opportunities via their Young Person’s Advisors and other support services.
What about other members of the public who are struggling to make ends meet/other support available?
We understand that we could not help everyone with our basic income pilot however the Welsh Government has announced further support for others which may be of interest.
On 15 February, the Minister for Finance and Local Government announced a £300 million-plus package of support for people struggling to make ends meet as a result of the cost of living crisis.
The funding is supporting a £150 cost-of-living payment that will be provided to all households in properties in council tax bands A to D, and to all households which receive support from the Council Tax Reduction Scheme in all council tax bands.
A further £25m will be available to local authorities in the form of a discretionary fund. They will be able to target this additional funding to help households which may be struggling.
The funding will also support a further winter fuel support scheme during winter 2022 to 2023. We are looking at how the scheme can reach more households so that more people receive the £200 payment which offers such crucial support.
On 10 June we also announced nearly £4 million of funding which will enable the Fuel Bank Foundation to introduce a national fuel voucher scheme in Wales which will provide direct financial support to eligible households on prepayment meters and those not connected to the mains gas network who are struggling to prepay for their fuel.
The Minister for Social Justice chaired a Cost of Living Summit on 17 February along with Minister for Finance and Local Government, Rebecca Evans and Minister for Climate Change, Julie James. The Summit was an opportunity for the Welsh Government to gather over 170 social partners and stakeholders to work together to develop a strategic approach to tackling the impacts of the cost of living crisis. We know that no one organisation can tackle the cost of living crisis alone and a strategic partnership approach is the only way forward to developing real solutions at this challenging time.
Wider Support for Low Income Households
We continue to provide support for households through our support for a more generous ‘social wage’ programmes which have the effect of leaving more money in the pockets of Welsh citizens.
This includes initiatives such as our Childcare Offer, our Council Tax Reduction Scheme, Free School Meals, our Warm Homes Programme and our commitment to support with health costs such as universal Free Prescriptions.
In addition, as part of our fair work agenda, we are committed to promoting and encouraging adoption of the Real Living Wage as a way of tackling low pay and in-work poverty.
In Wales, we support an emergency fund for people experiencing extreme financial difficulties. People experiencing financial hardship may be eligible for support through the Discretionary Assistance Fund (DAF). The DAF fund can be applied for via the website or by Freephone telephone on 0800 859 5924.
We are also encouraging people to contact Advicelink Cymru to check they are receiving all the financial support they are entitled to. The service can also signpost other services which may be of use. They can be contacted on Freephone 0800 702 2020 or you can talk to adviser online. They can also talk you through the options available for funding childcare when you are considering options to return to work.
If you would like to speak to a member of the Welsh Government about the Basic Income Pilot team, please email BIPilotWales@gov.wales.