Give us cash and we'll study

A pilot scheme that gives money to deprived youngsters to stay in education after 16 is proving a success. But, asks Karen Gold, can Gordon Brown afford to extend it nationally?
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After a hard day's study at Dearne Valley College, Rebecca Price, 17, goes home to relax before settling down to some coursework. Daniel Lunn, also 17, goes home too. But he bolts his tea and rushes off to do a four-hour shift in McDonald's. He won't start his coursework until 10pm.

Rebecca and Daniel are both on a two-year BTec national course in public service. In fact, they are in the same class. Both their families have below-average incomes. They have similar career aspirations: Rebecca to be a prison officer, Daniel to join the police. Both would like to go to university.

Educationally there is just one difference between them. Rebecca travels to college from the eastern edge of Wath upon Dearne. Her home falls within Doncaster local education authority, which is taking part in a government experiment that pays 16- to 18-year-olds to stay in education. While she is a student, it pays her £15 a week. Daniel lives south of the town in Rotherham, which is not part of the experiment. McDonald's pays him; otherwise he gets nothing.

The system of financial support for 16- to 18-year-olds has been in a state of flux for three years, ever since the Government began piloting different incentives to persuade young people to stay in education beyond GCSEs.

In September 1999 it introduced the Education Maintenance Allowance (EMA) – grants of up to £30 a week for any 16- to 18-year-old whose parental income is less than £30,000 (£20,000 in London). These allowances are paid on a sliding scale: teenagers whose parents earn less than £13,000 get the full amount; those from higher-income families see the money taper down to a minimum of £5 a week.

Fourteen local authorities were picked for the first trial, most of them areas of urban deprivation. In 2000-01 the allowances were extended to another 41 authorities, still mainly in towns and cities, and with a variety of formats: some pay the money in transport vouchers, some pay cash into students' bank accounts, some pay into accounts held by their parents.

To get their allowances, students have to sign a learning agreement promising not only that they will attend college every day and do all their homework, but also that they will behave well in class. If they miss classes without good reason they lose their money. Most schemes also pay a termly bonus, usually £50, for satisfactory work and attendance during that term.

More than 100,000 youngsters will have taken up an EMA by the end of the academic year, costing the Government about £150m. So how much difference have the pilot schemes made, and what will happen to them when they end this summer?

The number of extra students staying on at school or college because of the allowances is about 5 per cent, according to research carried out for the Government. That means about 5,000 students are in post-16 education who would not otherwise have been there. But that relatively modest increase masks a much more substantial boost to numbers in deprived areas. The numbers of post-16 students are up by at least 7 per cent, and in some cases by 11 per cent, as a direct result of the allowances – with the biggest increase in that hardest-to-tempt group, young men.

At Dearne Valley the impact of the allowances on student recruitment has been glaringly and in some ways uncomfortably obvious, says the college principal, Chris Morecroft. The number of 16- to 18-year-olds in the college has risen from 690 to 836 in the last two years, a growth rate of more than 20 per cent. All of the extra students have come from the Doncaster and Barnsley local authorities, he says. (Barnsley, as an EMA pilot area, also pays its students.) None of the growth has been from Rotherham.

Of course, these students need not only to start college but also to stay there and gain their qualifications. On retention and exam success, says the Department for Education and Skills, the jury on EMAs is still out. The DfES has just extended all 57 pilot schemes to July 2003 to give time for more research.

Mr Morecroft has no such reservations: his figures show more than 90 per cent of Barnsley and Doncaster students still on their courses this year, compared with only 73 per cent of Rotherham's. "I worry about Rotherham students and the chances they lose by leaving early to take up jobs. They can earn £11-12,000 in a call centre, but they are abandoning their studies for jobs that have no real training, and once they are 19 they will no longer be entitled to free education: they will have to pay fees."

He also worries about students such as Daniel who have to work part-time to support themselves. "Students on EMAs don't have the same pressure to take part-time work. They know they have a core amount of funding to fall back on. We only have a very small hardship fund for Rotherham students, yet they need to put in as much work if they are going to get the merits and distinctions they need for university."

Because so many EMA pilots are in urban areas, where students criss-cross from various boroughs to various colleges, the anomaly of some students getting £30 a week and others getting nothing is not rare. But it is disconcerting, even to the Government: John Healey, the minister for lifelong learning and Dearne Valley's MP, has agreed it cannot go on indefinitely.

The question is: what should replace it? A recent DfES review of EMAs pointed out that word has got around quickly about EMAs, and potential students in pilot areas already regard them as an entitlement. At the same time, students and colleges who see winners and losers side by side in the classroom want a fairer scheme.

The solution may lie in a hint tucked away in Gordon Brown's latest Budget speech. EMAs, he says, are definitely delivering positive results. But to pay them across the country, even to families with under £30,000 annual income, would cost more than £500m. Which is why the Government is now considering a highly controversial question: should EMAs eventually replace child benefit for young people over 16?