The EMA scheme cost £560m annually, but the new 16 to 19 bursary fund is worth £180m this year. The 12,000 most vulnerable 16- to 19-year-olds will receive guaranteed bursaries of £1,200 a year.
Schools and colleges will be able to distribute the rest of the money to support any student who faces financial barriers to participation such as costs of transport, food or equipment.
The scale and frequency of bursary payments will be decided by schools and colleges, but government is asking institutions to set conditions for students who receive cash, for example on good behaviour or attendance.
The government has also confirmed plans to offer transitional funding to support young people who are part-way through their studies and currently receiving EMA.
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