It will be years before she is able to have a home of her own, even a council home. It will be years before she can afford to be financially independent or claim her own benefits.
To be blunt, op, I would not bank on help from the state if I were young and in your daughter's position. I suspect that, over the next ten to fifteen years, the welfare system will change significantly. It is not just the introduction of Universal Credit, but the probable lowering of the maximum claim amount, the arrest of increases with inflation, and the possible move to an actuarial system to be more in line with the EU. She could very well end up impoverished.
So I would say your daughter really needs her qualifications; she needs a future and the opportunity to generate her own choices if/when the baby goes to school (should she decide to continue with the pregnancy).
Obviously, I do not know where you live but the FE colleges in my area, where people used to go to take GCSEs and A levels at a later date if they left school without them, now no longer offer them; you have to travel a good twenty miles to get to a college that does. The path that some of my friends that were teen mums took twenty-five years ago, where they left school at 15/16, had their babies and went to the local FE on the bus for GCSEs and A levels a few years later, is now no longer an option.