Youth Contract: the details of what it is

The Youth Contract is often presented by Nick Clegg and the Liberal Democrats as one of the party’s main achievements in coalition government.

The headline messages about the Youth Contract are clear and straight-forward, and can be summarised as:

The Youth Contract is an ambitious £1bn programme to make sure every 18 to 24-year-old has the opportunity to earn or learn.

But what are the details of the Youth Contract?

The Youth Contract’s main elements

• The Youth Contract is providing at least 410,000 new work places for 18 to 24 year olds.
• That is made up of 160,000 places being supported by wage subsidies and 250,000 new work experience placements.
• The Youth Contract is also boosting apprenticeships with at least 20,000 more incentive payments to encourage employers to take on young apprentices. This doubles the previous government commitment.
• Finally, a £126 million programme to help the most disengaged 16 and 17 year olds get back to school or college, onto an apprenticeship or into a job with training. This will cover at least 55,000 people with no GCSEs at A-C and not in education, employment or training (NEETs).

All these figures are for three years, starting April 2012, and are in addition to other government schemes. Some parts of the package apply to the whole country and some are England-only but with extra funding for Northern Ireland, Scotland and Wales.

Youth Contract’s wage subsidies

The wage subsidy part of the Youth Contract follows the calls from the CBI and OECD for this type of action. It is an incentive payment of £2,275 per person, which is half of the youth National Minimum Wage for six months. People on the scheme will receive at least the National Minimum Wage, with employers paying the difference.

Youth Contract’s work experience placements

The work experience placements part of the Youth Contract are available for every unemployed 18 to 24 year old who has been on Jobseeker’s Allowance for three months and wants one. The placements last for up to eight weeks.

Speedier support for 20 unemployment blackspots

The 20 worst areas for youth unemployment (which are in Scotland, Wales and northern England) are getting a speeded-up version of the Youth Contract. In these places, a young person has to have been unemployed for only 6 months, rather than the standard 9 months, in order to qualify for the wage subsidy support.