UBI for Care Leavers: a discussion with Patricia Lucas

The Welsh Government’s announcement that they will pilot a Basic Income for Care Leavers is an interesting policy innovation, for a group which has, until quite recently, received very little policy attention, using an approach that has recently gained international interest.  Anna (UBI expert) and Patricia (Child Health and Wellbeing) got together to discuss.

Patricia: There is a strong argument for improving support for Care Leavers.  Most children gain independence in lots of small incremental steps beginning long before they turn 18, with support from parents continuing long into adulthood.  Historically, Care Leavers were expected to be wholly independent from their 18th birthday. It’s easy to see why that could be a bad experience for anybody but particularly for young people who've been in care.  All Care Leavers have had disrupted childhoods, many will have experienced abuse or neglect, often have had very disrupted education, and high rates of physical and mental ill health.

Policy has already changed to recognise that the ‘corporate parent’ (the Local Authority) should continue to have parenting responsibilities as children transition to adulthood. Care Leavers are now entitled to support from a Personal Advisor until they are 25, alongside what is called the Local Offer.  The Local Offer varies by location, but includes things like exemption from council tax, help with the cost of job interviews or driving tests, free leisure centre membership or bus passes.  While the Local Offers can be really helpful, what is on offer isn’t always used or useful.  In addition, just having enough money for their needs is a big problem for Care Leavers. A lot of Personal Advisor time is spent helping Care Leavers access benefits and find suitable, stable and affordable housing leaving less time for supporting them in other ways. So it feels like there is plenty of room for improvement.

Anna: Yes the psychological stress of scraping around for every penny is huge.  And certainly if you look at the Finnish basic income experiment, one of the very clear positives was that people felt happier, they felt less stressed, they felt more secure. So you'd hope that that would certainly be an outcome.  The evidence on work outcomes is more mixed. Other Basic Income experiments seem to have a small positive effect on people moving into work, moving into better work or back into education, but others have been broadly neutral. So you could probably expect it to have, at worst, a neutral effect with good reason to hope for a positive effect. Although I will say, the income in this programme will be way above what an 18 year old will probably earn. So it would really help if it came with some really good careers advice and guidance and support to find the right college course, the right university course. If you start working on top of this, you won't lose any of this money, which is great, because Universal Credit has massive work disincentives: you lose at least 60p in the pound if you start working or earning over a certain amount. 

What do we know about how it is going to be implemented?

AD: It’s interesting that apparently the Welsh government aren't calling this universal basic income. But they have adopted the UBI principle of there being no conditions to receiving the money, and no restrictions around what it can be spent on. I think that the fact they've adopted that principle feels really important. Because this could be a voucher scheme, couldn't it? This could be, we'll just give you all a flat to live in for free, or we'll give you a free bus pass. It could be all sorts of useful things, but they don't confer that same level of freedom and independence. So that feels quite radical. 

And that question of freedom of choice over what you want to spend your money on is huge. That's one of the underlying principles of a UBI, that freedom to choose, and not to be dictated to by what somebody else thinks is a good way to spend your money. But I think that's potentially going to be part of what's really controversial about this is. What is public opinion going to be on what the young people are choosing to spend it on? I would anticipate not very much controversial spending in reality, but it's the sort of thing that will get picked up by certain bits of the press.

PL: Yes, I can see there might be a lot of scrutiny of that. Though some Care Leavers will have already shouldered a lot of responsibility, so may be more responsible than the general public might imagine.

But I think the other element is that, by definition, this is a more than usually vulnerable group of young people. So we should be concerned about anything that might increase their risk of exploitation. And this is also a group where you might find higher rates of other challenges and difficulties; perhaps speech and language communication needs, higher rates of ADHD, high rates of ASD. So some of these young people might need additional help around budgeting and managing money. That said, they need that help anyway and it has got to be more possible to be successful at budgeting when you've actually got enough to budget with? 

AD: I read in the announcement that the government will provide additional support around things like money management to the young people that get this. So hopefully there will be a carefully thought through package, rather than saying here’s some money and off you go. 

PL: I also think that public opinion is often just unrealistic about financial choices and what good spending looks like when you haven’t got much. For instance, loneliness is a really big problem for Care Leavers. A few are able to stay on with foster families, but most won't be living in a family or with friends so they can be very alone. Things that others might see as luxuries - like Netflix or a gaming subscription - might be a really important way to fill your time and connect with others. I think that the absence of any dictation around what the money can be spent on feels really important.

AD:  I think there will also be some interesting things to work out there around how these young people will be supported to find decent jobs with decent pay at the end of the two years. How they're going to smooth the transition for the young people at the end of the two year period will be quite important. This is much more than a minimum wage job and much, much, much more than being on universal credit.  The sort of entry level jobs that a young person might get would pay a hell of a lot less than the basic income. You wouldn’t want them falling off a cliff when the scheme ends, suddenly unable to afford rent or bills. 

PL: You're right about wanting to avoid a sudden end to support, but I also have some worries about the beginning too. It is not uncommon to leave care before your 18th birthday, so what will happen if you are 17 and 6 months and your foster placement breaks down? You are not eligible for this support for another 6 months. What about the care leavers who are leaving care between now and when the programme gets actually launched?  

AD: Some of that is just the nature of testing something out, isn't it, that there's always going to be people that don't qualify, but for this group, who are often more vulnerable, how do you communicate that? What do you do for those that don't qualify for it? Because they're already facing a tough time. To know that if they'd been born six months later, they'd have been getting lots of free money. That would be a really quite hard thing to come to terms with. 

Do you think there's any risk that other parts of the Local Offer would disappear or become harder to access? This is obviously being described as new and additional, but do you think in reality that some of the support network or services might start disappearing?

PL: That's a difficult one to answer, because it's also about different pots of money. One is central government and one is local government spend. So in theory, they shouldn't conflict with each other. But it is true when local government budgets are so stretched, then everything that isn't statutory can be cut. It may be hard for local authorities to protect additional spending for Care Leavers when they know they are getting this direct support. Or it could mean the additional support from the local authorities might be focused on the very slightly older young people. The support does taper as young people age, so I suppose if you had this basic income for the youngest group, you could shift up some of that other additional support to those aged 20 and over?

What would we want to see monitored and evaluated?

AD: What kind of outcomes you're going to see at the end of the two years and past the end of the two years will be quite interesting. I think you'd want to look at that really quite broadly. So not just a yes/no for employment, education or training, but, and this is why I hope that they will be provided with some good careers, information, advice and guidance, to be able to record that as an ongoing process, rather than just a yes or no outcome. 

PL: You might hope that the thing that they want at the end of the pilot is not necessarily higher rates of employment within the period, but more young people taking up training and education options, because they are a group that need greater investment in their education, broadly speaking. Making that an affordable option seems like a really important potential positive. 

AD: Definitely. And to be able to get work experience or do an internship, which shouldn't be unpaid, but they still often are. Those sorts of things are really, really hard to access, if you're trying to support yourself. 

PL: Yes, or volunteering in general can be important for building skills and connections for work.

I think one of the challenges for evaluating this scheme is that we have very poor data about our Care Leavers to begin with. So it will be difficult to look at change because we don't have a baseline to work from. What we know about the wellbeing of Care Leavers is from non-representative surveys so that is only partial information. But you’d definitely want to be looking at that. 

AD: And I would want to know what all of this looks like considerably beyond the two years of receiving the money. Their aspirations and whether they have shifted their long term training or employment journey. Career outcomes versus “I'm desperate for any job because my money is stopping next month”. More of a nuanced picture of that would be really important. 

PL: Yeah, I think that's a good point. What might happen during the two year period is interesting, but more so how this might set you up for the next five years?

AD: Yes, how many 20 years olds have a well paid job with a fulfilling career? I certainly didn’t, but where you are at that point can set you up for that 3 to 5 year timeline. That's potentially quite difficult to evaluate, to say this person is or isn’t in a good position to move forward. 

PL: Some of the really important early years research shows you might have to wait 20 to 30 years until you get a cost saving, but you do get one. That’s the difference that true developmental support makes - it changes your direction and trajectory. The evaluation question is whether easing that transition for Care Leavers, having more stable housing, generally having a better time in those earliest days of adulthood, allows opportunities. And what you might avoid might be as important as what they immediately gain. Long term worklessness, periods of homelessness, involvement in the criminal justice system, those kinds of very negative experiences. I think it is reasonable to argue that you need to wait for some time to see whether the scheme delivers benefit.

AD: that’s going to be quite a significant challenge for Welsh government and the evaluators. There will be a lot of pressure to say what this has achieved at the end of the two years, and to say “we’re not going to know anything meaningful for another five years” will be hard. 

PL: Also the scheme is generous in money, but for a small number of young people. It’s not plausible to suppose that every one of these 500 young people is going to find this a transformational moment in their lives. There will undoubtedly be some that thrive and some that struggle. With a small pilot and a lot of press attention it will be difficult not to just look at example cases in either direction. But it’s a small pilot to be able to see whole system change, and I think that might have to look at the outcomes as a population, rather than individual, level and need a longer evaluation window for that.

Will it help or hinder the UBI cause?

AD: I wonder if this will help or hinder calls for a wider UBI. On the one hand it might establish more support around the principles of people being free to spend it as they wish, having no conditions attached. But equally because it’s quite small and very very targeted on a group that clearly has got different needs to others, does that actually play the other way? To imply that actually most people don’t really need this, this is just for a special group of people that really really do need lots of extra help? Interesting to see which way public opinion sways.

Public awareness of basic income has grown massively in the last 3 years, and I think support has also grown at the same time, but this is by far the closest to home example that we’ve got to this in the UK. 

PL: I do think that while they are a very important group, they are not a typical group. So I think it will be difficult to draw conclusions for using a BI approach in other contexts.

And it almost feels like in this case, the moral case for supporting care leavers matters as much as whether there is evidence for a Basic Income approach. It seems to me public opinion could swing against it for reasons that are nothing to do with what UBI is or whether it works. For example, children might be in care because of criminal involvement and you can imagine some people might judge they are not deserving of this support. With this very narrow focus there’s a few inherent dangers. 

AD: And that could swing either way as well. Because it’s going to be given to everyone in the cohort, there are no moral judgements on whether anyone deserves it or not. We don’t get to know about anyone’s individual circumstances, so that’s immaterial and we can’t form a judgement as to whether we think they deserve it or not. That could be helpful, but it also could let speculation run rife and swing the other way quite easily. Lots of considerations for Welsh government, and I’m looking forward to seeing how it’s rolled out and how it progresses.