New Enterprise Allowance James Whitley 1 July 2011

New Enterprise Allowance The original Enterprise Allowance scheme... Some similarities but some key differences: Local partnerships Mentors Capital Funding mechanism Critics of the original scheme pointed to: the emphasis on removing claimants from the unemployment count the lack of any evaluation of the potential business itself the relative paucity of support training.

New Enterprise Allowance Aims To encourage self-employment as a viable route into sustained employment and financial independence for unemployed people Government cannot do this alone – we want to harness a wide range of talent, ideas and good practice. This requires the help of business, from sole traders to the largest global companies, the public and voluntary sector and local deliverers of services.

New Enterprise Allowance Plans for self-employment Promote self-employment to unemployed people and, through the New Enterprise Allowance, give up to 40,000 unemployed people over two years access to the advice and support they need to start their own business (DWP Business Plan published 8th November 2010) Promote the benefits of mentoring and make it easier for small and medium-sized enterprises to find business advice and support from mentors, working with the private and voluntary sectors (BIS Business Plan published 8th November 2010) Ensure that those looking to start a business can access the information they need online, including about franchising, published in an open and standardised format so that it can be re-used for free by third parties (BIS Business Plan published 8th November 2010)

New Enterprise Allowance Overview Announced on 5 October 2010 by the Secretary of State for Work and Pensions Available to Jobseeker Allowance (JSA) claimants who have been claiming JSA for more than six months Initially available in those areas which face the greatest unemployment challenge. Phased rollout April (trailblazer from January 2011) National from August Key Components: Participants will get access to a volunteer business mentor who will provide guidance and support as they develop their business idea and through the early stages of trading Once a customer can demonstrate they have a viable business proposition they will be able to claim financial support, a weekly allowance for 3 months, and then half that rate for a further 3 months If they need start-up capital, they may also be able access to a loan up to £1,000 to help with their start-up costs Total package of support could be worth around £2,000 to each claimant who wants to start their own business

New Enterprise Allowance Key elements Credibility and quality of applications/ partnerships... Alignment and inclusion of other funding streams Strong track record of delivery Experience of engagement with target group Partnership working including across public, private, third sectors Credible arrangements for financial control, performance management and stakeholder/ partner engagement

New Enterprise Allowance Key elements Partnerships – emphasis on local needs/ local volunteers Volunteer business mentors – emphasis on quality Business ideas are scrutinised – growth potential Other support – identifying and accessing/ signposting support On-going support - first 26-weeks of trading

New Enterprise Allowance The legacy NEA is not just another scheme: It’s about creating sustainable businesses with potential for growth A legacy of community benefit: A tangible contribution to the local (and wider) economy Measuring the impact..... NEA will be evaluated as part of the wider evaluation of the GBW measures

New Enterprise Allowance Trailblazer - early indications... ... are positive: Lots of interest from mentors, matches made Low drop out rate High level of participation Majority of business plans approved People are trading

New Enterprise Allowance Working together New Enterprise Allowance is one part of a much wider strategy for self employment and business growth Jobcentre Plus will play an important role - but not on its own To make a difference we will all need to work together to build on the best local expertise and support Working with businesses and the voluntary sector to recruit and match mentors for unemployed customers Wrapping local business support provision around the NEA to enhance the offer for unemployed customers Tailoring provision to match local need Ensuring joined-up local promotion and provision for everyone considering self employment - not just as part of the NEA Working with Local Enterprise Partnerships to support enterprise and encourage entrepreneurship amongst jobless customer groups

New Enterprise Allowance Over to you... Questions?