Support needed for care leavers when Wales basic income pilot ends

Young care leavers will be given support to transition when a basic income pilot begins to end next year, Wales’ social justice minister said.

Jane Hutt gave a statement, updating the Senedd about the pilot that offers young people leaving care a basic income of £1,280 a month after tax for two years.

She told MSs 635 young people joined the pilot which represents 97% of those eligible.

The minister said the Welsh Government is focused on plans to support the first cohort of basic income recipients who will see their payments end from July 2024.

She told the chamber: “We are working closely with key delivery partners and the recipients themselves on how best to support them through this transition.

“As care leavers, these young people already have pathways in place that are intended to support them as they transition out of care.

“We’ve been working with our partners to build on those existing plans and provide guidance and checklists to make sure that the young people are as prepared as they possibly can be.”

Ms Hutt said officials are working with the UK Department for Work and Pensions on how to support young people as they transition to universal credit.

Plaid Cymru’s Sioned Williams raised the children’s commissioner’s concerns about the impact on support such as student finance, housing benefit or legal aid for those seeking asylum.

Ms Hutt acknowledged issues with legal aid, saying the UK Government confirmed young people in receipt of basic income would not be exempt from means testing.

‘Over budget’

Joel James, for the Conservatives, raised concerns about funding, saying the trial will go around £5 million over budget.

The South Wales Central MS pointed out the Welsh Government announced a £7m cut to the social justice minister’s budget on October 17.

Mr James told MSs the scheme would cost more than £500m if it was made permanent and rolled out to more young care leavers over the next 10 years, saying: “It would not be financially proper to spend such large amounts of public money.”

Mr James questioned claims that a universal basic income is being tested, suggesting care leavers were chosen to stifle opposition to the proposal.

He described the pilot as “exactly the same as what is offered by existing welfare support”.

During plenary on Tuesday October 24, Lib Dem leader Jane Dodds took issue with this depiction, saying: “The clue is the name is on the tin.

“It is a basic income to every single young person, and so please, please don’t mix it up, because that is not a true picture of what the situation is.”

The Mid and West Wales MS was encouraged by the reported mental health improvements of participants. “That in itself, for me, is worth it,” she said.

Plaid Cymru’s Luke Fletcher echoed Jane Dodds’ call for consideration of a basic income pilot to help workers transition from high-carbon sectors to greener industries.

The Welsh Government has commissioned Cardiff University to lead a four-year review of the pilot, with the first thematic report due to be published in early 2024.

By Chris Haines, ICNN Senedd reporter