The number of children living in poverty in the UK is now at 4.1 million and will reach over 5 million by 2021, according to the Institute for Fiscal Studies. And children who are in poverty are now living, on average, further below the poverty line than they did 10 years ago. After making great progress at tackling child poverty, we’re now going backwards – at a time when unemployment is at a near historic low. This is cause for great concern, and not just for those in this country. It is significant that the UN special rapporteur on extreme poverty and human rights, Philip Alston, will visit the UK next month. He has highlighted issues he would like to focus on during his visit, with austerity and universal credit featuring prominently. He will have no shortage of hardship to report on.
At Child Poverty Action Group we do extensive research into what causes child poverty. Key among the drivers of rising child poverty is the benefit freeze – the failure to increase social security for working-age people in line with the cost of living. While the state pension has been protected with a ‘triple lock’, children’s benefits have not. Child benefit, a lifeline to many families with children, is projected to have lost 23% of its 2010 value by 2020.
In addition to the freeze, some families are having to contend with the benefit cap – which limits total benefit payments for working-age households. The majority of people affected by the cap are lone-parent families, and the policy disproportionately affects lone parents with young children (under 5-year-olds) for whom going out to work to escape the cap is very difficult.
The ‘two-child limit’ restricts child tax credit, housing benefit and universal credit to two children per family, with limited exceptions. Subsequent children get little support. This will push another 200,000 children into poverty. Along with the benefit cap, the two-child limit breaks the link between what families need to support their children and what they get. This link should be a fundamental principle of the social security system.
The freeze, benefit cap and two-child limit apply in both the pre-universal credit social security system and in universal credit. But universal credit brings additional problems of its own. More money was injected into the system at the autumn budget, but this does not make up for all the cuts.*
There are also many problems with the design of universal credit – from the five week wait for first payment to the requirement that claims be managed entirely online. These are causing widespread hardship and insecurity. But even if the system was perfectly designed, there are problems with how it’s being managed – from mishandling of evidence by the Department for Work and Pensions, to miscalculation of payments for housing costs and for people with disabilities. Support for claimants to manage the system is wholly inadequate, and there are more problems ahead because the way the government proposes to move everyone on the pre-universal credit system over to universal credit places all the risk on to families. We’re worried that many thousands who are already struggling may fall through the gaps.
Families with children have been worst affected by a decade of government cuts. We know how devastating living in poverty can be for children as they grow up, with the effects lasting into adulthood. This is not inevitable. We’ve seen that governments can also successfully reduce child poverty. But they need to start by reversing the damage already done.
A version of this piece first appeared in the programme for the London Child Summit on 17 October.
*This blog was updated on 30 October to reflect the changes announced in the Budget