IFS destroys Coalition claims for cutting EMA


by Sunny Hundal    
December 14, 2010 at 5:56 pm

The Institute for Fiscal Studies has today come out strongly against Coalition arguments to cut the Educational Maintenance Allowance.

In a report posted on their site tonight they dismiss many of the arguments made by the Coalition. The IFS also says that if the government wanted to be consistent, it would also drop payments of Child Benefit to households with children over 16 who are in full-time education, as it had a similar impact. But they haven’t.

The Government defends its intention to scrap EMA – and replace it with a smaller payment – on the grounds that the EMA is expensive and fails to deliver enough bang for its buck.

What does the IFS study find? (their statements turned into points)

1. Previous work by IFS researchers found that the EMA significantly increased participation rates in post-16 education among young adults who were eligible to receive it.

2. The costs of providing EMA were likely to be exceeded in the long run by the higher wages that its recipients would go to enjoy in future.

3. A simple cost-benefit analysis mentioned above suggests that even taking into account the level of “wastage” (i.e. people who would have gone into education anyway even if not receiving EMAs), the costs of EMA are completely offset.

4. The key assumption behind the Government’s methodology for calculating the “deadweight” is that the impact on participation is the only outcome that matters. But the EMA may have other benefits: … for example through better attendance, or more study time as a result of not having to take on a part-time job.

5. Even if the EMA had no impact on educational outcomes it would still represent a transfer of resources to low-income households with children, which may in its own right represent a valuable policy objective.

The IFS also points out that several other Coalition policies, such as the temporary relief of Employer National Insurance Contributions (NICs) for new businesses located outside the South East and Eastern England, had more “wastage” but were put in place anyway.

To that extent, they say, the Educational Maintenance Allowance represented good value for money.

The full report is here.

Another key claim by the Coalition completely destroyed.


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About the author
Sunny Hundal is editor of LC. Also: on Twitter, at Pickled Politics and Guardian CIF.
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Reader comments


1. Me

It just shows us all how the libs are selling out every one in this country.
Sad to see such party with such a history of social justice being used.

I do not think we will see a lib government again in my life time

2. Margin4error

But don’t you understand? It fundementally isn’t fair that poor kids get something that wealthy kids don’t.

;)

3. Me

sorry
i would never of thought of that.
lets just ban it then
and while the libs are on it every thing people with money don’t use.

student loans , welfare state.buses,Nhs .social services. comprehensive school , council housing , housing benefit ect ect …

Oh crap i see your point

4. Chris

EMA isn’t paid to ‘poor’ kids. It’s paid to kids whose parents know how to, and are prepared to, play the system. My kids don’t get it. I’ve got a job. Most of their rich friends do.

It’s an odious system which never was anymore than an attempt at an electoral bribe. The sooner it goes the better.

5. Nick

No, EMA rocks, and it kept me in bus fares and food while I was at college.

I mean, if my mum hadn’t smoked, we could have afforded those things. Or I could have had two meals a day and walked the 10 miles each way. I probably wouldn’t have, though.

6. Me

so i take it 4 that you read the sun >?

Ema makes sure that some children can go to collage ,#

Some kids get 10 pounds

That pays for their food at dinner time.

perhaps you are one of them out of touch people i don’t know you.

but what is wrong is that we don’t give our children the skills to go in to jobs then moan when we bring refuges in to take the jobs they cant qualify for ,,

fragmented Britain full of the selfish

7. Richard W

The IFS may find themselves abolished if they keep embarrassing the Coaltion.

8. Nikki

I’m in two minds over the EMA. I got it when I was at college; £30 every week. I’m not sure why, as unlike university, every textbook we needed was provided. I even got free transport to and from college.
So of course it was spent on perfume and underage drinking.

I can see why EMA would help a lot of people but there are so many people who got it who, like me, had no need for it. All it did was put me off getting a job for a while, and made me go to my patently useless ‘key skills’ lessons, because of that termly £100 bonus.

9. Mr S. Pill

@8

“All it did was put me off getting a job for a while”

Isn’t that the point, though? So you can – technically – concentrate on your studies rather than having to juggle a job at the same time? Yes, of course some folk spend/spent EMA on stuff unrelated to do with studying. Same as with student loans/grants since time immemorial. But it doesn’t change the fact that for a lot of people – as the IFS report shows – EMA is/was a huge factor in them doing their A-levels.

10. Dan

@ 4. Chris- What are you talking about mate. EMA is paid to children who’s household income is under a certain level… that you ‘have a job’ doesn’t meant your kids won’t get it unless you’re earning a high amount of money. What, you thought it was just jobless scroungers getting it? You’re dangerously out of touch with reality. Furthermore, ‘all their rich friends’ that you claim are getting it would have to be living in households with low income to qualify… it kind of contrasts with ..you know…them being rich..

Its not to suggest the system can’t be played… but even rich people have to declare a sizable amount of their income in order to maintain their lifestyles legitimately… You can see how your case would them come across as a gross exaggeration and a pseudo-generalisation with no grounding in reality.

11. cjcjc

How useful the IFS is. When you only highlight the stuff you like, of course.

What about their work on the structural budget deficit (what’s that? there isn’t one, you say?) and the progressive structure of the new tuition fees (can’t hear you, lalalalalala….)

12. Mark M

“if the government wanted to be consistent”

That’d be a first

13. Margin4error

cjcjc

Are are you attacking LibCon again rather than discuss a quite significant issue?

14. Margin4error

Mark

I refer you to posts 2 and 3 to see just how consistent the coalition is… ;)

15. Luis Enrique

here is Paul Gregg and Lindsay Macmillan of CMPO on EMAs:

http://cmpo.wordpress.com/2010/12/15/ema-and-good-evidence-based-policy-making/

16. Sarah AB

If the EMA isn’t working quite as effectively and fairly as it should be – then it should be tweaked rather than abolished. Point 4 seems particularly useful. University students with richer parents tend not to have to look for paid work (or at least they won’t have to work so many hours and will probably be less likely to spend time commuting from home to save money.)

cjcjc – yes there has been an effort to ensure that loan repayments are progressive. It could have been worse but that doesn’t mean the fee rises should be welcomed or seen as progressive in their overall impact. If your parents are paying a deposit on a house for you, you’re going to be able to handle loan repayments better than someone who is perhaps a first generation university student without that kind of support. Also, if you look at the universities at risk there is a strong correlation between the number of students from lower socio-economic backgrounds and high risk status. If some of the new unis fail then it’s unlikely the losers will be middle class (potential) students. It’s all very well saying the universities are going to have to give bursaries to poorer students but some universities (and I don’t mean this as a criticism) have very few students from such backgrounds in the first place.


Reactions: Twitter, blogs
  1. Liberal Conspiracy

    IFS think-tank destroys Coalition claims for cutting EMA http://bit.ly/f7mwSz

  2. NewLeftProject

    RT @libcon: IFS think-tank destroys Coalition claims for cutting EMA http://bit.ly/f7mwSz

  3. Nigel Shoosmith

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  4. Ally Jedley

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  5. Joe Cassels

    RT @libcon: IFS think-tank destroys Coalition claims for cutting EMA http://bit.ly/f7mwSz

  6. Robin T Cox

    RT @sunny_hundal: IFS report comprehensively destroys Coalition arguments to cut EMA. Summarised here: http://bit.ly/f7mwSz

  7. Paul Wood

    RT @libcon: IFS think-tank destroys Coalition claims for cutting EMA http://bit.ly/f7mwSz

  8. Mark Worgan

    RT @sunny_hundal: IFS report comprehensively destroys Coalition arguments to cut EMA. Summarised here: http://bit.ly/f7mwSz

  9. Maeve McKeown

    RT @sunny_hundal: IFS report comprehensively destroys Coalition arguments to cut EMA. Summarised here: http://bit.ly/f7mwSz

  10. James Brown

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  11. Jennifer O'Mahony

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  12. James Killin

    RT @sunny_hundal: IFS report comprehensively destroys Coalition arguments to cut EMA. Summarised here: http://bit.ly/f7mwSz

  13. emma dow

    RT @sunny_hundal: IFS report comprehensively destroys Coalition arguments to cut EMA. Summarised here: http://bit.ly/f7mwSz

  14. Alison Charlton

    RT @sunny_hundal: IFS report comprehensively destroys Coalition arguments to cut EMA. Summarised here: http://bit.ly/f7mwSz

  15. Amir Rashid

    RT @sunny_hundal: IFS report comprehensively destroys Coalition arguments to cut EMA. Summarised here: http://bit.ly/f7mwSz

  16. Matthew Rees

    RT @libcon: IFS think-tank destroys Coalition claims for cutting EMA http://bit.ly/f7mwSz

  17. Mili

    @DuncanStott Hmm, never trust stats you haven't forged yourself… ;) http://bit.ly/gEgCJq I'd love to have time to do my own calcs on this.

  18. Allan Nicolson

    @nick_clegg RT @libcon IFS think-tank destroys Coalition claims for cutting EMA http://bit.ly/f7mwSz – Your move, Clegg.

  19. Tom Bench

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  20. Press Not Sorry

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  25. Josie S

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  36. Lazlo Woodbine

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  37. Nick H.

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  38. ABC

    RT @allannicolson: @nick_clegg RT @libcon IFS think-tank destroys Coalition claims for cutting EMA http://bit.ly/f7mwSz – Your move, Clegg.

  39. Toby Barrett

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  40. Lucy Ellinson

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  43. safefromwolves

    RT @sunny_hundal IFS report comprehensively destroys Coalition arguments to cut #EMA. Summarised here: http://bit.ly/f7mwSz #demo2010 #dayx3

  44. sion simon

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  45. Jacob Richardson

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  47. Malena Jenkins

    RT @sunny_hundal: IFS report comprehensively destroys Coalition arguments to cut EMA. Summarised here: http://bit.ly/f7mwSz

  48. Adam Armstrong

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  49. EMAs and Real Politics « Bad Conscience

    [...] IFS has slammed Coalition plans to remove the Education Maintenance Allowance from Britain’s poorest kids. In [...]

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  56. An Open Letter to Charlie Gilmour. « Velvet Coalmine

    [...] of erudite, articulate young people were out there on Thursday, many protesting not fees but their loss of the EMA, which is arguably a greater blow to working class educational prospects. They could have expressed [...]

  57. sunny hundal

    @josielong @fidouglas yup, there was a good report by IFS destroying Tory claims to cut EMA. Summarised here http://bit.ly/f7mwSz

  58. sunny hundal

    On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  59. Ceehaitch

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  60. Deb

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  63. Alex

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  64. Daniel Drage

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  65. Malcolm Evison

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  66. Tudor Evans

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  77. Johann Hari

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  78. Johann Hari

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  84. Meurig Gallagher

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  85. Nicolas Fanget

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  92. Alex Collinson

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  93. Alistair Sinclair

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  94. Ste

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  95. Mindee Hutchinson

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  96. Michael Garett

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  97. Steve Trow

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  98. poppycollinson

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  99. Kanja Ibrahim Sesay

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  100. Nathan Blood

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  101. Jacob Richardson

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  102. salardeen

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  103. Top Politics Tweets

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  104. Linda Gilroy

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  105. Paul Hufton

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  106. Claire Bent

    …EMAs – a report that destroys government claims for cutting it: http://bit.ly/f7mwSz …makes for interesting reading #fb

  107. Lynda Waltho

    RT @CouncillorTudor: RT @libcon: IFS destroys Coalition claims for cutting EMA http://bit.ly/f7mwSz I'd like my local Tory MP to read th …

  108. christine clifford

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  109. Alex Wintermute

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  110. Rachel

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  111. celesnewyear

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  112. Phil Whittaker

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  113. Richard Thwaites

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  114. Rebecca Pillinger

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  115. bunkerwhitney

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz

  116. eszter

    RT @sunny_hundal: On EMAs, we earlier summarised a report that destroyed government claims for cutting it: http://bit.ly/f7mwSz





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