Skip to main content


View NSCB Procedures View NSCB Procedures

11.8.2 Financial Arrangements for Care Leavers


This procedure details the financial arrangements and support available for care leavers.


Children (Leaving Care) Act 2000

Care Planning, Placement and Case Review (England) Regulations 2010

Care Leavers (England) Regulations 2010.

The Children Act 1989 Guidance and Regulations - Volume 3: Planning Transition to Adulthood for Care Leavers (revised January 2015)


Leaving Care and Transition Procedure


In January 2016, this chapter was updated and should be re-read throughout.


  1. Introduction
  2. Living Allowances
  3. Accommodation
  4. Additional Allowances
  5. Home Establishment Grant
  6. Education, Employment and Training
  7. Further and Higher Education
  8. Emergency Assistance
  9. Health and Wellbeing
  10. Counselling or Therapeutic needs
  11. Care Leavers who are /Expecting to be Parents
  12. Care Leavers who are Disabled
  13. Care Leavers in Custody /Detention
  14. UASC
  15. Young People who Return Home
  16. Young People living with a Connected Person
  17. Qualifying Young People
  18. Care Leavers Returning after the Age of 21

1. Introduction

This document has been produced with reference to the provisions of the Children (Leaving care) Act and the revised Children Act 1989 Guidance and Regulations - Volume 3: Planning Transition to Adulthood for Care Leavers (revised January 2015). It outlines the Local Authorities policy with regard to:

  • Accommodation and maintenance for young people who have left care aged 16 and 17 years;
  • General assistance for care leavers up to age 21;
  • Help with employment up to age 21;
  • Help with education and training to the end of an agreed programme;
  • Provision of vacation accommodation for care leavers in Higher Education or Further education residential courses;
  • Support for young people who wish to return to education post 21 years.

The provision applies to care leavers who are living independently or semi independently and where there are no placement funds to cover costs. It is not available to looked after young people living in foster placements or community homes where there are allocated budgets.

All allowances will be based on an assessment of need and set out in the Pathway Plan. The relevant level of authorisation must be sought and recorded before finance is agreed with a young person or payments made.

2. Living Allowances

16/17 year olds living in residential or foster placements

In order to support future economic wellbeing for children in care as they make the transition to adulthood there needs to be early emphasis on financial literacy and financial capability. It may be helpful to give appropriate fostering allowances such as pocket money, toiletries and clothing allowances direct to young people to help them begin to make financial choices and think about spending responsibly. Saving and debt avoidance should be encouraged and young people should be supported to open appropriate savings and bank accounts. All budgeting support and financial arrangements should be made clear in the young persons Pathway Plan.

Where there is a plan for a young person to be discharged from care prior to age 18, any budget authorisation for living and maintenance costs should be agreed in advance of the discharge. Where young people remain in the care of the Authority but move to unregulated or supported accommodation, costs continue to be paid from Children's Services Budgets. However, the financial arrangements for these young people should be consistent with the policy for relevant care leavers as set out below.

16/17 year olds living in supported or semi/independent settings

Young people living independently in the community or in semi supported accommodation will receive a weekly Personal Allowance set at the Income Support rate for over 18s. Where possible, allowances will be paid into the young person's bank account, but in some cases, particularly where young people are particularly vulnerable or are not fully engaging with services, it may be more appropriate for young people to be given allowances in person. This can ensure a safety net for some young people. In extreme circumstances a member of staff may need to shop with the young person or provide allowances in kind.

Personal Allowances will be paid regardless of any other income the young person receives due to attending college, training or employment. The ability to earn more money will be a real incentive to young people and support the development of a work ethic, economic goal setting and self reliance. Budgeting work with young people will need to forecast any potential drop in income post 18, and prepare young people for this. Young people should be encouraged to save.

In addition to the minimum Personal Allowance, a quarterly clothing allowance will be paid at the rate for 16/17 year old LAC young people. It may be appropriate to pay this weekly along with Personal Allowances or as a lump sum depending on the needs and maturity of the young person. Some young people may need the spending of this allowance to be supervised.

Where young people are attending college, training or work, bus fares or travel costs will be paid where reasonable and appropriate. Fares can also be paid to support young people in attending interviews.

Public transport fares can also be paid to help young people maintain or build links with family in line with the Pathway Plan.

Most care leavers under 18 will live in supported accommodation and the Local Authority will pay for accommodation and associated support costs. However, where utilities or food are provided, young people will be expected to pay towards these costs from their income. The amount will depend on the type of accommodation. Where young people are placing accommodation in jeopardy by refusing or being unwilling to pay this charge, payment may be made direct by the Local Authority and weekly allowances reduced accordingly.

Care leavers aged 18 and over

The primary financial responsibility for care leavers over 18 who are not in employment lies with the Department for Work and Pensions. Care leavers may be eligible for a number of welfare and means tested benefits via Job Centre Plus.

The Personal Adviser will support young people to make benefit claims where needed. Benefit level support will be provided to young people waiting for their first benefit payment for a time limited period of up to four weeks. Where benefits have still not been received within this timeframe and there is evidence that there has been advocacy on behalf of the young person where needed, further payments can be paid but with the authorisation of the 18+ Leaving Care Team Manager which should be recorded on case records.

Young people not in employment and eligible for benefits will be expected to begin the process of applying for benefits as soon as possible and at least within a week of their 18th birthdays. Where young people fail to do so, financial support will be reduced to £2.50 cash per day for 2 weeks and up to £2.50 in kind per day thereafter.

Young people, who default on requirements made by the DWP, lose money or experience budgeting difficulties and who find themselves destitute will be expected to make a Social Fund application. Where this is refused, a discretionary payment to a maximum of £2.50 per day will be made to ensure that the young persons have food until they receive their next payment. Assistance will usually be given on a day to day basis in these circumstances to ensure the young persons wellbeing.

Young people who find employment will receive an allowance equivalent to benefit rates until first salary payments are received. Fares to work and equipment may also be provided to support the young person in moving from benefits to employment or to prevent a gap in employment.

Care leavers may be able to claim Income Support and Housing Benefit whilst in full time Further Education from their 18th birthday until they are 21 as long as they enrolled on the course prior to their 19th birthday. If in part time education, they may be able to claim Job Seekers allowance.

Where young people aged over 21 years wish to pursue a programme of education, they are entitled to request an assessment of their support needs from the Leaving Care team. This will include an assessment of any financial needs taking into account state benefit entitlements.

3. Accommodation

For 16 and 17 year old care leavers

The Local Authority is responsible for providing accommodation to eligible and relevant care leavers until a young person is 18. The most appropriate type of accommodation will have a high level of support either with staff on site or regular staff visits to provide support and monitoring. All requests for such accommodation should be made to the Placements Team. Due to the high costs involved in such placements, authorisation must be sought from the responsible Children’s Service Manager. Costs must be clearly documented on the young persons file and in the Pathway Plan.

Care leavers over 18

When young people are over 18, the primary responsibility for the provision of accommodation passes to the Local Housing Authority (District Council)

At the same time young people may become eligible for a number of means tested benefits including Local Housing Allowance for rent if in receipt of JSA/IS. Some District Councils operate rent in advance/ deposit guarantee schemes to support people e to secure accommodation in the private sector. Where this is not an option, the Local Authority, will consider payment of or a contribution towards the first months rent and deposit where a full assessment has been undertaken and the tenancy is believed to be appropriate, safe, affordable and sustainable for a working young person. A Pre tenancy Determination should be requested to ensure that the rent can be covered by Housing Benefit in the event of the young person claiming benefits.

4. Additional Allowances


Essential citizenship identity documents will be funded by the Local Authority. These include birth certificates, passports, driving licences, young person's citizen cards, deed poll to change name.

Moving House

Young people will be supported with the costs associated with moving house, such as removals, furniture storage, and suitcases and boxes where appropriate.


Some young people will have no contact with family or poor family/social relationships. Where this is the case, birthday and festivity allowances can be paid at the discretion of the relevant Team Manager.

  • Birthday Allowance age 16/17/19/20 per annum £15;
  • Birthday Allowance age 18/21 per annum £25;
  • Christmas/alternative Religious Festival per annum £10.

Driving Lessons

  • For young people who are or have the prospect of working in an industry that requires a full driving licence and this is clearly recorded in the young person’s pathway plan, and have the means to obtain, maintain and insure a vehicle, support may be provided for no more than 10 driving lessons at the discretion of the relevant Children’s Services Manager.

5. Home Establishment Grant

An allowance of up to £2,000 is available to pay towards the cost of setting up home. This may include, the first year's contents insurance and TV Licence.

This grant should be spent in stages and ideally the bulk of it will be spent in setting up the young person's first independent, stable accommodation. Young people should be supported by the Personal Adviser to furnish their home and it may be cost effective to apply to charities selling good quality second hand goods and reliable and reputable second hand stores.

Circumstances may arise where it will be reasonable to pay unspent Home Establishment Grant beyond 21 or when the service ends. Any agreements to do this will be made by the relevant 18+ Leaving Care Team Manager and recorded clearly on file. Cash balances of unspent grant will not be paid to young people.

Where applicable young people should be supported to access other grants available through the Department for Work and Pensions

6. Education, Employment and Training

Care leavers should be encouraged to set goals and have aspirations in terms of future economic wellbeing. The aim of this provision is to promote and encourage young people to remain engaged in education or take up new education and training opportunities and undertake activities aimed at improving employability for those not engaged in education, employment and training.

7. Further and Higher Education

The Leaving Care Service will offer financial support for care leavers in education until they are 21 years old or until the end of a programme of education or training if it has been previously detailed in the Pathway Plan.

Costs will be met in full for;

  • Registration and Examination fees;
  • Textbooks and software specified as essential;
  • Activities essential to meet course requirements;
  • Public transport between home and place of learning;
  • Transport to open days and interviews;
  • Specific clothing, including clothes for interview and essential equipment relating to the course;
  • For young people in residential colleges or universities away from Nottinghamshire, the Leaving Care Team will provide the means for transporting the student and their belongings to and from university at the beginning and end of terms if needed.

Further Education

A bursary scheme has replaced the Education Maintenance Allowance for students aged 16 to 18 in full time education. Care leavers and students on Income Support will be eligible to apply for the Vulnerable Student Bursary of up to £1200 per annum.

For young people aged 19 years and over colleges have access to discretionary student financial support which is assessed on an individual student basis.

For young people who cannot access benefits, either because they are over 21, they enrolled after their 19th birthday or for some other reason, an assessment will be carried out by the Personal Adviser and subject to the outcome of that assessment, personal allowances may be paid in lieu of benefits. Accommodation may also be provided or the means to secure it (through rent payments) to a maximum of the relevant Local Housing Allowance rates.

Higher Education

A contribution towards annual tuition fees of up to £3,465 per annum will be paid by the Local Authority. This figure is based on former 2012 tuition fee rates. Any additional fees will need to be met by the student via a repayable student loan from Student Finance England.

A bursary of £2000 will be paid by the Local Authority to each student. This can be used by the student for equipment, field trips and other course related costs.

Reasonable local market accommodation costs will be met by the Local Authority including vacation costs. Where a student returns to a previous foster carer or supported lodgings provider, rent will be paid at local housing allowance rate and the young person will be expected to pay for food, utilities from their own income.

Students will be expected to apply for the Non Repayable Maintenance Grant for their daily living needs. Some universities and colleges pay bursaries and offer additional support for young people who have been in care. The individual universities, Frank Buttle trust and the Personal Adviser will be able to provide advice.

8. Emergency Assistance

Arrangements may be made to assist in an emergency. This could involve a small cash payment, provision of fuel payment cards or a food parcel where applicable. If authorised, the cause of the crisis and details of help provided should be documented on the young persons file. This should not be relied upon and young people should be encouraged to manage without or be assisted in the form of a loan wherever possible.

9. Health and Wellbeing

Care leavers under the age of 19 and in fill time education will generally be exempt from the majority of NHS charges. For others they may be able to claim assistance via the NHS Low Income Scheme by completing forms HC1 (SC) and HC1 insert links.

Lone parents and sick and disabled young people in receipt of Income Support or Employment and Support Allowance will be exempt from NHS prescription charges, dental charges and sight tests by virtue of their specific benefit claims.

Requests from young people for assistance over and above the basic provided by the above will be considered on a case by case basis EG glasses and dental work not covered by benefits.

10. Counselling or Therapeutic needs

Young people under the age of 18 can be referred to the Child and Adolescent Mental health Service Children Looked after Team. For those over 18, this team may be able to offer consultation to the personal adviser but not direct work, Young people requesting direct therapeutic support would need to be referred to Adult mental health services through their GP.

11. Care Leavers who are/Expecting to be Parents

Relevant young people who become parents will be eligible for state benefits with the exception of Housing Benefit, from the date of the Child's birth. Benefit level allowances will be paid while the claim is being processed. Former Relevant young people will be entitled to claim Income Support eleven weeks prior to the due date of the child and for a maternity Grant if not employed.

12. Care Leavers who are Disabled

16/17 year old sick and disabled care leavers who meet the criteria may be able to claim Income Support or Employment and Support Allowance and some other benefits such as Disability Living Allowance. However, they cannot claim Housing Benefit or Local Housing Allowance. Information about Disability Living Allowance and other benefits is available from Disability Alliance website and from Department for Work and Pensions website. For 16/17 year olds, full costs of supported accommodation will be paid for and the support element of Disability Living Allowance will not be taken into account. The young person will be encouraged to use the money to save towards future needs or to aid their life opportunities. The mobility part of the DLA will be taken into account when awarding travel payments.

Where a young person is over 18, and in supported accommodation, the support element of which is not funded by Adult Social care, the young person will be expected to contribute to the support element of their care package from their DLA support element. Similarly, the mobility part will be taken into account when awarding travel payments.

13. Care Leavers in Custody /Detention

For those young people aged 16/17 in custody or receiving compulsory hospital treatment, a "pocket money" allowance of up to £20 per month will be agreed with the relevant establishment as long as this payment is consistent with the rest of the establishment population. Festivities and birthday allowances will continue to be paid and may be saved if appropriate for the young person on release. Transport from custody may be arranged or paid for and immediate needs on release considered.

14. UASC

Also see the PPG re UASC.

16 and 17 year old UASC living in supported accommodation will not be discharged from care so all funding will be from LAC budgets. Where placements are in a supported setting, financial arrangements will be the same as for relevant care leavers, as set out above.

From the age of 18, Former Relevant young people who have been granted leave to remain in the UK can generally claim means tested state benefits and have rights to public housing. This includes cases where the young persons leave to remain has expired but he/she has applied for an extension of leave to remain (provided the application was made before the previous period of leave to remain expired) and that application is still under consideration, or an appeal against the refusal of the extension has been made.

Where young people have limited leave to remain (usually Discretionary leave) or are appealing an adverse decision, the Local Authority will consider funding education courses that finish in the academic year prior to their leave expiring. This enables young people to complete courses and gain qualifications that they can use on return to their country of origin.

The law on the withdrawal or withholding of Local Authority support to young people is included in Schedule 3 of the Nationality, Immigration and Asylum Act 2002, which prevents certain categories of migrants from accessing ‘leaving care’ and other types of support. Paragraph 6 of Schedule 3 states that young people who are considered to be ‘failed asylum-seekers’ are entitled to continue to receive leaving care support from a Local Authority up to the point where they ‘fail to comply with the removal directions’ set by the UK Visas and Immigration (a removal direction details the time and place of removal from the UK). In other words, being a failed asylum seeker is not sufficient cause on its own to withdraw or withhold social services support - they must, in addition, have failed to comply with removal directions issued in respect of them. However, many ‘end of line’ young people, rather than being defined as ‘failed asylum seekers’, will fit into another category detailed in Schedule 3: ‘persons unlawfully in the UK’.9 If a young person is found to be a person ‘unlawfully in the UK’, then they can have their leaving care support withdrawn, providing that to do so would not breach their rights under the European Convention on Human Rights (ECHR)

Once a young person is Appeal Rights exhausted the Personal Adviser should arrange for a Human Rights Assessment to be arranged Support with accommodation and housing will continue to be provided whist this assessment takes place and reasonable notice will be given for the withdrawal of services if the outcome of the assessment is that services are not necessary to avoid a breach of human rights. This process should be completed within 6 weeks of a young person becoming appeal rights exhausted.

More detail is contained in the Policy and Procedure Guide relating to Children From Abroad.

15. Young People who Return Home

Where, following a Statutory Review, young people who are accommodated under s.20 CA 1989 return home in a planned manner, they will cease to be looked after and be "relevant "children. On returning home the child's parents will be able to claim Child benefit as long as the child remains in full time education and training. After six months and following a review decision that the return has been successful, the young person will become a qualifying child.

Where the young person is not in education or training, it may be appropriate to provide short term financial support to help sustain the return until the young person engages in a programme of education and training. This financial support will be determined by the Looked After Children Team Manager and will take into account the needs of the young person and their family. For example, where the return is unplanned and likely to be very short term, it may be appropriate to pay a Personal Allowance to the young person from which they pay an amount to their parent for food and board.

Any financial assessment will need to take into account equity issues in relation to other siblings in the household. It will not be appropriate to provide additional allowances such as clothing allowances, home establishment grant, festivity allowances

Support can be provided for up to six months when a decision will be made regarding on going eligibility for services. If the return home has been successful, then the young person's status will no longer be "relevant "but "qualifying "under the Act. At this point, financial support will cease.

If a return home is unsuccessful, and a young person reverts to eligible or relevant status, they will be treated financially as any other care leaver.

16. Young People living with a Connected Person

There may be circumstances where the most appropriate place for a young person to live is with a person connected to them but who does not have parental responsibility. If the young person is still looked after, the connected person will be assessed under the fostering procedures. Approval for immediate placement may be given by the appropriate Children's Services Manager for up to 16 weeks.

Where the young person is a "relevant" young person, the placement may be approved as a Supported Lodgings placement and a referral should be made to the Family Service. Where this is not appropriate but the placement is believed to be suitable in the short term, funds of up to £50 per week can be provided to the connected person for "rent" and the young person will be provided with a Personal Allowance for food and any contribution to the provider for utilities.

17. Qualifying Young People

For care leavers who qualify for advice and assistance under S24, the primary financial support role remains with the department for Work and Pensions. However, the Local Authority may give financial assistance which may be in kind or cash to these young people on account of any particular needs they may have over and above these of other young people until they reach age 21 or 25 if engaged in education.

18. Care Leavers Returning after the Age of 21

A former relevant or qualifying young person aged between 21 or 25 (including those who were closed at 21) may request to re-engage with services in order to pursue a part time or full time programme of Further or higher education. In these cases, the young person should submit a written request for support and set out;

  • The details of the programme;
  • Reasons for pursuing the programme;
  • Demonstration of motivation and commitment;
  • Funding needed - both in terms of programme costs and any associated costs of support required to enable them to access and sustain the programme.

Young people can be helped by a member of the 18+ Leaving Carer Service to do this where needed.

The request will go to the relevant 18+ team manager who will decide if the programme is suitable and appropriate for the young person and in line with their future plans. Publicly funded provision should be accessed where available.

If the request is approved, a Personal Adviser will be appointed to complete a Pathway Plan. The pathway plan will address;

  • Support; including financial to enable the young person to enrol on and maintain the programme;
  • Support; including financial relating to additional factors which might impact on the young person's ability to be successful on the programme such as housing, care or health issues. This additional financial support will be assessed on a case by case basis;
  • Long term planning and continued progression toward the young persons career aspiration.