Immigration minister Des Browne, who launched the initiative last week, said the money is designed to support the Government's plans to integrate refugees into the community.
The Home Office draft plan, Integration Matters: A National Strategy for Refugee Integration, envisages active participation and volunteering as the key to helping refugees achieve citizenship. The proposals include refugees undergoing intensive programmes with case workers to find work, housing and volunteering opportunities, the offer of loans and increased funding for local projects.
In addition, case workers will help ensure young refugees are registered in school and trainee teachers will be taught how to support refugees.
The Congolese Youth Association, which is getting 24,750 to help 80 young refugees learn English and IT skills, welcomed the proposals.
Mao Zakuani, project manager at the association, said: "Most young refugees' experience of the system when they arrive here is bad. They are often unaccompanied, don't know the language and are distraught. Getting them into civic engagement is a good way to integrate them."
The money will be channelled via the European Refugee Fund, the Home Office Challenge Fund and the Purposeful Activities for Asylum Seekers Fund.
According to the Government, unaccompanied young people under 25 accounted for 36,175 of the UK's 84,130 asylum seekers in 2002.
The Home Office's integration strategy is open to consultation until 20 October.
www.homeoffice.gov.uk.
