Helping lone parents develop and maintain their attachment to the labour market not only helps them meet their parental responsibilities, which has positive impacts on their children's health, schooling and prospects in later life, but is also an effective way of moving them and their children out of poverty and ensuring their social inclusion. This is why we are introducing the Work Related Activity Premium (WRAP).
Lone parents in pilot areas who have been on certain qualifying benefits for at least six months, whose youngest child is aged 11 or over, will be eligible for the WRAP if they agree to take formal steps to return to the labour market. Participants will be paid a £20 a week premium for six months, which will be paid on top of their ordinary Income Support entitlement. If the lone parent stops doing work related activity, or enters work, payment of the premium will end.
The WRAP will be piloted in seven Jobcentre Plus districts from April 2007. The costs of providing WRAP in the pilot areas will be dependent on the number of lone parents who choose to participate in this voluntary initiative, and undertake work related activity. The pilot areas cover approximately 10 per cent. of the lone parent population and will inform us on the level of take up we can expect if the premium is rolled out nationally at a later date. As the pilot doesn't start until April 2007, any costs in 2006-07 will be pilot start-up costs only.
The cost of providing the WRAP to each lone parent who volunteers to take part in the pilot will be £520 if they receive the premium for the full 26 weeks. Lone parents moving off benefit and into work will result in savings to Government benefit expenditure.