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Page last updated at 13:25 GMT, Tuesday, 2 June 2009 14:25 UK

Tough times for parents of teens

Simon Gompertz
Working Lunch

The Pursey family
The Pursey family have lost their EMA despite redundancy.

Parents who have lost their jobs but are hoping that their children will get the £30 a week Education Maintenance Allowance could be in for a nasty shock.

The allowance is designed to reward teenagers of 16 and above for staying on at school, but in England it is assessed only on the previous year's household income.

So children whose parents have been made redundant in the downturn could miss out, even though their families are struggling to pay their bills.

EMA 'trap'

"There's going to be so many people caught up in this trap, with so many people being made unemployed," warns Janette Pursey from Marsden in West Yorkshire.

Janette's husband was made redundant in March, so she was hoping that her a 16 year-old daughter, Chloe, would qualify for Education Maintenance Allowance, known as EMA.

But when she rang the helpline, she discovered she was wrong.

"To be eligible it was actually taken on the taxable income from April 2008 to April 2009," Janette explains, "But Chloe is not starting college until September and obviously it's then that we need the money."

"It shouldn't be subject to last year's earnings," she says.

How the allowance works

The allowance is paid at a rate of £10, £20 or £30 a week, directly to the teenager, depending on household income. In England, families qualify if income in the previous year was under £30,810. Elsewhere in the UK the upper limit is as high as £32,400.

And there's another big difference in the way Scotland, Wales and Northern Ireland administer EMA. If household income changes suddenly, the allowance can be reassessed.

The Scottish government allows a new calculation to be made if income falls by 15%. In Wales an applicant can ask to be considered again if there is a "permanent" drop in income which would affect the claim.

Concern for further education

The Low Incomes Tax Reform Group is worried that the inflexibility of the English system could undermine the effort to keep young people in schools and colleges.

"We wouldn't want to see is any young people encouraged to come out of education because they can't access this additional support," comments Victoria Todd from the LITRG.

Chloe Pursey is in the middle of her GCSEs and she was hoping to join 600,000 young people who are already receiving EMA. The allowance would have helped with her travel and study costs.

I think that the system should be more reactive to the position you're in now.
Janette Pursey

"We're not going to be able to afford to give her the money," says her mother, "She's going to have to get a job to fund herself."

"Hopefully by the time September comes, we will be in a better situation," adds Janette Pursey, "But I think that the system should be more reactive to the position you're in now."

Exceptional circumstances

There's a contrast beween the EMA rules in England and the rules governing tax credit and student loan applications.

With both tax credits and student loans you can apply on the basis of your current income, if need be, rather than the income you received last year.

English families can get an EMA reassessment in exceptional circumstances - if a parent becomes disabled, for instance.

But what the Purseys have discovered is that losing your job isn't exceptional enough, even though the family finances can be devastated.

Schools Minister Jim Knight said:

We base entitlement to EMA on the previous year's income assessment as that is the latest full year for which evidence is available.
Jim Knight, Schools Minister

"We base entitlement to EMA on the previous year's income assessment as that is the latest full year for which evidence is available. Under certain exceptional circumstances where a learner's household experiences a permanent change, such as the death of a parent, then this can be taken into account and learners re-assessed.

"Colleges can support learners through financial hardship, such as redundancy, with discretionary support funds and we would expect them to use these especially if the learner were in danger of dropping out of education.

"This funding exists to respond to sudden changes in circumstances, such as redundancy, which the nationally administered EMA scheme cannot respond to mid year.

"A successful EMA income assessment entitles learners to up to three years of EMA on the same rate even if their household income increases during the three year period.

"In addition, they will be guaranteed a minimum level of financial help should they decide to go on to higher education. It would be inappropriate to base to up to six years allowance on what could be a temporary change in circumstance."

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