Hundreds of unemployed teens leaving care to be handed £1.6k-a-MONTH under Welsh Government basic income scheme
HUNDREDS of unemployed care-leavers will be given a £1,600 monthly handout by the Welsh government.
Up to 500 18-year-olds are expected to get the basic income for up to two years, giving them £19,200 before tax.
Ministers think it could help them better transition into adult independence and reduce poverty.
Social Justice Minister Jane Hutt said the £20million scheme, starting in the next financial year, would “deliver financial stability for a generation of young people that need it most”.
The money will be taxed at the basic rate and is thought to be counted as income by the UK Government, meaning it would impact on eligibility for benefits.
It is 70 per cent of Wales’ average salary, which was £582.20 per week and £2,251 per month last year. Officials say it is the real living wage.
The sum is thought to be the highest figure ever offered under a basic income scheme in the world.
All young people leaving care in Wales are eligible for the payments and can get it from the first month after their 18th birthday.
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There will be no other requirements to get the money and no limitations on how it is spent.
But the Welsh Conservatives’ shadow minister Joel James said: “The Labour government is not even close to living in reality with this trial.
“Countless trials from across the globe have found basic income does not have the expected outcomes.”
He said it fails to incentivise work and called it a waste of public money, adding: “Our NHS is at breaking point and our economy is in a fragile state.
“Instead of tackling those issues head-on, Labour are more interested in Basic Income which will cost the country an absolute fortune.”
A two-year basic income pilot with jobless people in Finland found it made people happier but did not improve employment.