Is it worth paying young people to stay on at school?

Today’s political news is brought to you by the letters E, M and A. Eeeema. While the political establishment debates the abolition of EMA – the Educational Maintenance Allowance – inside Parliament, campaigners will be protesting against it on the streets outside. The police, who are used to these things by now, have already set up the barricades.

Behind all the fuss and froth, the argument is really this: is EMA good value? The coalition claim that paying 16-18 year-olds up to £30 a week to stay on at school is not only expensive, but also wasteful. Labour – who introduced this allowance in the first place – claim that it opens up education for young people who otherwise couldn’t afford the associated costs, and that the economy benefits overall.

But who’s right? Here’s a round-up of some of the facts, with my brief comments and queries, so you can make your own mind up:

1) EMA costs half a £billion a year. Which is a lot of money, particularly during a period of cuts, austerity, etc. And it’s up from around £300 million a year, in real terms, when the scheme was first introduced.

2) EMA goes towards half of all 16-18 year-olds in full time education. Which seems extremely high. Would all of these 16-18 year-olds be unable, or unwilling, to attend school without EMA handouts? Unlikely, I’d say – particularly as some of the households that qualify for EMA payments have an annual income of £30,000. The National Foundation for Educational Research estimates that 90 per cent of the students who receive EMA would have stayed on at school without it.

3) Evidence suggests EMA does improve educational take-up. Before EMA was introduced nationwide, pilot schemes were conducted in 56 of the 150 local education authorities. Subsequent research suggested that staying-on rates were up 5.9 per cent in those authorities. Question is, is this a significant enough return on all that public money?

4) Deadweight costs. Following on from point 2) above, the main worry with EMA is that it’s just a deadweight cost: that we’re paying money to young people who would have stayed on at school anyway, and that they’re not exactly spending it on textbooks and set squares. It’s hard to stretch beyond anecdotal evidence for that second point. But even Andy Burnham conceded ground on it, speaking to the Beeb, last night:

“Yes, they may spend some of it on food and even the occasional time out with friends, but part of being in a college means taking part in the whole life of a college, and why should we say to young people from the least well-off backgrounds, well, ‘you can’t have those things’.”

5) But if you take a wider view, it could benefit the economy. The IFS have done research on this for an academic journal that isn’t available online. Happily, though, Channel 4’s Faisal Islam has summarised it here. The basic point is that – even allowing for deadweight costs – EMA could have long-term benefits for the economy by improving the productivity of those 16-18 year-olds who stay on in education; by reducing crime; by increasing study time, etc.

To my mind, it’s clear that EMA is, at the very least, a flawed programme, and could do be more carefully targeted – if it’s to be retained at all. For their part, the coalition are keen to emphasise that they have, and will introduce, their own measures to help disadvantaged young people attend school. But, before they get to that point, they need to dwell on a more fundamental question: whether school really is a better option for many 16 year-olds than the world of work. I’d be keen to hear CoffeeHousers’ thoughts on all that. So, over to you.