New Enterprise Allowance scheme - My story

XEO25 · 9 August 2011 at 2:41PM

I've used this forum for years but never really gave anything back. I plan to keep this thread as an online diary of my experience during the New Enterprise Allowance scheme. [FONT=&quot]Hopefully [/FONT]it will encourage others to give it a go and answer any questions they might have.

For those that don't know, getting on to the NEA scheme is done in 3 steps...

Step 1 - A meeting with your personal advisor in the Job Centre to discuss the possibility of going on the NEA scheme. If your personal advisor supports your idea (mine is an online design agency - web design, SEO, branding etc) they will then book an appointment with a business expert.

Step 2 - Discuss the idea with the business expert who has the final [FONT=&quot]decision [/FONT]on whether the business idea is viable or not. (This is the meeting I have tomorrow).

Step 3 - If the idea is seen to be viable, you will be paired up with a business mentor who will continue to develop the idea further. This process is said to take 6-8 weeks.

I have the following questions to ask tomorrow, feel free to add anything you think I should ask...

1) I am living with partner, we both receive £105 per week as we are both unemployed. How will the NEA scheme effect this payment?

2) My partner an I also receive housing benefit and council tax benefit. How will the NEA scheme effect this payment?

3) What are the exact conditions of the £1000 loan? APR, length of loan agreement, etc.

4) Should the business fail, what is the process of going back on to JSA until I find employment?

If anyone else is on the NEA scheme, feel free to share your thoughts

Oldernotwiser · 9 August 2011 at 3:37PM

That sounds really interesting, although I think you may find it moved from the Benefits Board. I'll certainly come and look for it if it is.

XEO25 · 11 August 2011 at 11:53AM

Passed the interview (Step 2) as the advisor said my business idea was viable.

Given forms to fill out to apply for the £1000 loan, which can be paid back over 3 years at 10% APR. Also you only have to pay the interest in the first year, which works out at about £9 per month. After 12 months you have 2 more years to pay back the loan, but I'm going to pay the £1000 back at the end of the first year.

I asked how it would effect my JSA as I'm on a joint claim with my partner. He said it would actually benefit us more, as insted of getting £105 per week, I would now get £65 per week from the NEA and my partner would get £65 as a single JSA claim, so we're £25 better off per week. He said the NEA scheme has no effect on Housing/Council tax benefit.

Got another meeting with the NEA in 2 weeks to show them my business plan and get the ball rolling on the business. The loan is expected to take 3 weeks to come through.

All in all it seems like a very good scheme for those wanting to go it alone insted of looking for work.

Kimitatsu · 11 August 2011 at 4:01PM

I will leave the thread here for now.......but it may be more relevant on the job seeking board later

If I do move it there will be redirects though.

Good luck for tomorrow

williacg · 11 August 2011 at 4:13PM

I don't use the Forum that much anymore, but I agree that this thread could prove to be extremely helpful to many of the unemployed posters who might be contemplating a similar venture. Good luck, and I hope all goes well.

flappy_mcwarbucks · 11 August 2011 at 4:18PM

Oooh, what a good idea. I was thinking of starting up on my own. (if you cant find a job, make a job!) So i shall be following this with interest

dane-katie · 11 August 2011 at 4:28PM

Is the £1000 loan from the DWP?

WPN · 11 August 2011 at 5:53PM

shaneo85 wrote: »

Passed the interview (Step 2) as the advisor said my business idea was viable.

Given forms to fill out to apply for the £1000 loan, which can be paid back over 3 years at 10% APR. Also you only have to pay the interest in the first year, which works out at about £9 per month. After 12 months you have 2 more years to pay back the loan, but I'm going to pay the £1000 back at the end of the first year.

I asked how it would effect my JSA as I'm on a joint claim with my partner. He said it would actually benefit us more, as insted of getting £105 per week, I would now get £65 per week from the NEA and my partner would get £65 as a single JSA claim, so we're £25 better off per week. He said the NEA scheme has no effect on Housing/Council tax benefit.

Got another meeting with the NEA in 2 weeks to show them my business plan and get the ball rolling on the business. The loan is expected to take 3 weeks to come through.

All in all it seems like a very good scheme for those wanting to go it alone insted of looking for work.

Woah... I am shocked that the APR is 10%!!

They want you off benefits... so they want to reduce your JSA gradually.... (good idea, fair enough) yet they want you to pay 10% interest. I think there should be interest but no more than 5-6%. Also if what you say is true which I am sure it is: "you only have to pay the interest in the first year, which works out at about £9 per month"... it is silly how instead of a smaller interest rate through the 3 year term or a repayment holiday of the first 6-12 months... that you are expected to pay interest whilst still on benefits including when after 13 weeks the benefit is reduced to just £33... £9 is approx £2.25 a week which seems little but on £33 you need every last money you can although I am assuming (maybe wrongly so) you cannot earn any money from the business whilst claiming benefits?

BathGooner · 12 August 2011 at 7:16AM

Great thread Shaneo85. Your questions were what I was going to ask when I went to apply at Bath Job Centre yesterday. Unfortunately, the service has been temporarily suspended as they have been swamped with applicants. Should be back up when I return there in 2 weeks apparently.
I wouldn't say it was perfect but I had intended to start up on my own anyway so it seems ideal. I already have most of my tools but could do with the loan for a website and advertising.
Regarding the 'allowance' you are paid. Are you still paid it for the 6 month period even if you should have an income from the business relatively early stage?
Keep us informed and Good Luck!

skater_kat · 25 August 2011 at 10:24PM

any updates shaneo85?

Truegho · 26 August 2011 at 12:30PM

I thought the jobcentre gave you a weekly payment for six months or so to get your business off the ground. I didn't know it was a loan that you had to pay back.

shaneo85 wrote: »

I've used this forum for years but never really gave anything back. I plan to keep this thread as an online diary of my experience during the New Enterprise Allowance scheme. [FONT=&quot]Hopefully [/FONT]it will encourage others to give it a go and answer any questions they might have.

For those that don't know, getting on to the NEA scheme is done in 3 steps...

Step 1 - A meeting with your personal advisor in the Job Centre to discuss the possibility of going on the NEA scheme. If your personal advisor supports your idea (mine is an online design agency - web design, SEO, branding etc) they will then book an appointment with a business expert.

Step 2 - Discuss the idea with the business expert who has the final [FONT=&quot]decision [/FONT]on whether the business idea is viable or not. (This is the meeting I have tomorrow).

Step 3 - If the idea is seen to be viable, you will be paired up with a business mentor who will continue to develop the idea further. This process is said to take 6-8 weeks.

I have the following questions to ask tomorrow, feel free to add anything you think I should ask...

1) I am living with partner, we both receive £105 per week as we are both unemployed. How will the NEA scheme effect this payment?

2) My partner an I also receive housing benefit and council tax benefit. How will the NEA scheme effect this payment?

3) What are the exact conditions of the £1000 loan? APR, length of loan agreement, etc.

4) Should the business fail, what is the process of going back on to JSA until I find employment?

If anyone else is on the NEA scheme, feel free to share your thoughts

New Enterprise Allowance scheme - My story

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