The UK Rules
New Enterprise Allowance Scheme

New Enterprise Allowance Scheme Rules

The UK Government first introduced New Enterprise Allowance in April 2011. The NEA scheme helps unemployed people to start up in business or develop an existing venture.

NEA GUIDE: The New Enterprise Allowance program renders a resourceful combination of money and practical support.

Joining the scheme means you would get a weekly allowance and business mentoring. But, you must be claiming one of the qualifying benefits.

As a rule, you can join the program from the first day you start claiming for JSA or Universal Credit. But, there are some extra qualifying conditions.

Jobcentre Plus refer any interested and eligible candidates to a contracted provider organisation. The next step matches them up with their volunteer business mentor. They will then help them to draw up a business plan.

Individuals can then access the financial support once the plan gets approved and they stop claiming benefits.

New Enterprise Allowance Eligibility Criteria

You need to be over 18 to qualify for the New Enterprise Allowance 2019 initiative. You must also be able to show that you have a business idea - and that it could work. On top of that, you also need to be receiving one of these work-related benefits:

Note: You may also qualify if you get Universal Credit. This also applies even if you have already become self-employed.

The Jobcentre will assign you a business mentor if you are starting up a new business. The mentor will be able to give you advice and specialist support on:

Note: The main section provides further information on ways to find a job and how to get assistance if you are unemployed.

Becoming Your Own Boss

The primary aim of the New Enterprise Allowance (NEA) scheme is to help unemployed people become their own boss. As a result, it has helped unemployed benefit claimants launch over 200 businesses a week since 2017 (on average).

Government figures released as of October 2019 show that:

  • The NEA scheme has supported 209,000 benefit claimants since its launch date back in 2011.
  • It has resulted in more than 130,000 businesses being set up.
  • Around 20,000 of these enterprises came to fruition in the last two (2) years.
  • People aged over fifty (50) started more than 31,000 businesses.
  • Disabled claimants started almost 25% of all businesses (more than 29,000).
  • Ethnic minority groups (e.g. a person from a black and minority ethnic (BAME) background) have launched close to 14% of all businesses started since 2011.

The majority of claimants showing their entrepreneurial skills have been older folks and people living in the North West of the United Kingdom.

In fact, almost 20,000 businesses have been launched by benefits claimants in the North West since the scheme took off. London followed with figures around 15,370, while Yorkshire and Humberside had an entrepreneurial boost of some 13,700 new businesses.

Source: Taken from the Department for Work and Pensions (DWP) press release dated October 2019.


New Enterprise Allowance 2019 Financial Support

You will need to write a business plan and get it approved before you can:

Note: Being part of the Work Programme means you do not qualify for the New Enterprise Allowance.

New Enterprise Allowance payments do not affect your claim for most welfare benefits. There would be no effect on Housing Benefit, Income Tax, tax credits, Universal Credit, or the Access to Work grant.

Self-employed Claiming Universal Credit

Those who are self-employed and claiming Universal Credit may qualify for:

Universal Credit Helpline
Telephone: 0800 328 9344
Textphone: 0800 328 1344
Monday to Friday: 8am to 6pm

How the New Enterprise Allowance Works

Individuals who get accepted onto the scheme must meet these three specific conditions:

  1. Attend all meetings with mentor or mentoring provider organisation. As a rule, they will give you at least 24 hours of notice to attend the New Enterprise Allowance review.
  2. Perform weekly tasks that help to develop the business proposal.
  3. You must contact Jobcentre Plus (within 2 days) and inform them if the business idea ceases or the mentoring relationship ends.

Failure to meet these conditions means your benefits could get sanctioned. There may be exceptions where there are valid reasons.

Changing your mind before the scheme starts does not result in a benefit sanction. The same applies if you give a notice of 2 days before leaving the scheme once it is in progress.


New Enterprise Allowance Scheme Rules in the United Kingdom

© 2020 | ALL RULES | CONTACT | PRIVACY | SITEMAP