It is a great pity that the education maintenance allowance (EMA) has been scrapped. It was very effective and, contrary to assertions by ministers, very well targeted. It was certainly better targeted than post- 16 child benefit, which, as Lord Willis pointed out in a recent House of Lords debate, is not a universal benefit, but an allowance paid in respect of those who stay in education and is more likely to reach the affluent than the poor.

If, however, a national entitlement cannot be funded at the level of the EMA, the Government’s plans for discretionary bursaries, managed by schools and colleges, are the next best thing.

Discretion tends to get a bad press these days. Politicians are so frightened of the phrase “postcode lottery” that they assume any local variations in practice are unfair. In fact, there are many reasons why a flat-rate, one-size-fits-all solution can be far less fair than the intelligent exercise of local discretion.

National schemes are based on means-testing, yet income is a far from perfect predictor of the resources available to an individual. The number and age of siblings, for example, influences how much support a young person can get from their family. The health of family members or links with the extended family can also complicate the picture in ways a national scheme can never know.

It is also true that not all students face the same level of expenses. Some students walk to school; others face costs in excess of pound;30 per week just to reach the course of their choice. Some borrow the books they need from the college library; others have to invest in a uniform or purchase the specialist tools and equipment specific to the nature of their course. While it is probably true that vocational students on average face higher costs, there is much local variation that no national scheme could accommodate.

Local colleges are far better able to judge the impact of support than any national agency and therefore gain better value for money. The aim of financial support is to overcome barriers to learning and support success. Only the institution concerned can judge whether its investment in subsidised breakfasts, for example, is helping students succeed.

There are, however, two conditions for discretionary support being a success. The first is that, while general guidance on use of the funds may be helpful, detailed regulation is not. Local discretion means just that, not local administration of a scheme designed in Whitehall. Having passed responsibility to schools and colleges, the Government needs to let them get on with it without disproportionate monitoring and accountability arrangements.

The second condition is that there is enough money in the scheme. In the first year, around pound;150 million will be added to existing discretionary funds. At the same time, it has wisely been decided that transitional arrangements will be made for those already in receipt of the EMA. Taken together, the funding should be adequate to maintain levels of participation, particularly at 17-plus, where there is still a reduction of some 10 per cent in the participation rate.

In the following year, however, there will need to be a further investment in discretionary funds. Roughly half of the most disadvantaged group receiving the EMA will benefit from transitional protection in 201112.

When this ceases in 201213, therefore, the demand on discretionary funding will roughly double. The Department for Education needs to start planning now where the extra pound;150 million will come from.

Mick Fletcher is an education consultant.