Young people with additional capital of their own
The Leaving Care Act states that:
Some young people may have funds of their own such as legacies, or income through employment.
The leaving care service should treat capital and income according to the DWP regulations governing income support (the Income Support (IS) (General) Regulations 1987). This sets out a scale whereby capital up to £3,000 is disregarded and someone with capital assets of £8,000 or more is not entitled to assistance. Where a young person’s capital exceeds £3,000 but is not more than £8,000 an amount corresponding to the excess is treated as a weekly contribution against council support. The details will be recorded in the pathway plan.
Where a young person has been awarded a sum in compensation for a criminal injury, the council should disregard that capital entirely in the case of a relevant child. The leaving care service should ensure that such a young person has access to sound financial advice about the best use for such funds, bearing in mind those normal rules – in respect of benefit entitlement or student loans will apply when the young person reaches 18. The need for sound financial advice is especially pressing in situations where a young person plans to stay put with a foster carer and teams should ensure young people are encouraged to seek advice as early as possible.