It was Mother’s Day yesterday, a good time to recognise the unpaid but incredibly valuable work carried out by mothers across the UK. Yet despite the strides society has made in gender equality, there remains a gendered financial impact of parenthood on women. One way our society aims to recognise the additional costs brought by raising a family is through child benefit. Paid to the main carer, most often the mother, this gives many women money to spend on the things their children need.
Cost of a child
The cost of raising a child has increased, and government support has not kept pace. As a result of freezes to social security and sub-inflationary uprating, child benefit has lost nearly a quarter of its value since 2010.
According to our Cost of the Child report, raising a child from birth to their 18th birthday has increased for a couple family by 5.5 per cent, from £142,680 in 2012 to £152,747 in 2020 (pre-pandemic). The cost for lone parents has swelled by nearly 20 per cent to £185,413. Given that 90 per cent of lone parents are women, the cumulative economic impact on women of rising costs and the diminishing value of a benefit usually paid to the mother is disproportionate and simply not right.
We surveyed 1,000 parents receiving child benefit last summer, and compared the results with a similar survey we carried out in 2012. We found that parents are increasingly having to spend child benefit on essentials. Twenty-eight per cent of parents said they spend child benefit on everyday living expenses, compared with just 2 per cent in 2012. Families reported spending child benefit on other necessities such as bills (14 per cent) and food (33 per cent). Thirty-seven per cent of respondents admitted they couldn’t manage without child benefit, demonstrating how stretched families’ budgets have become.
Poor policy choices around child benefit are not only impacting low-income families. The Times has been highlighting the problems caused by the High-Income Child Benefit Tax Charge, which was introduced in 2013. This sees families where one parent earns more than £50,000 a year losing some or all of their child benefit. This threshold totally undermines the idea of a universal benefit where all children receive an income as a minimum protection against poverty.
Why should child benefit be universal?
A truly universal child benefit provides a strong and reliable foundation for children, supporting them regardless of their household finances. With no stigma or intrusive application process to put families off, take-up is high meaning more families benefit. It is the most cost-effective and efficient method of getting cash to families, and mothers in particular.
For the thousands of families who have found themselves with reduced working hours or out of a job entirely and on universal credit for the first time, child benefit may have been the only constant income they had. Lexie G, a participant in Covid Realties, found herself in that position while waiting for her first universal credit payment:
“For the last few weeks we have lived on £68 child benefit a week.”
Child benefit has provided an anchor of support for families and children through the waves of the pandemic. But it has lost value and no longer reaches all families. The government should invest in children and:
- increase child benefit by £10 per child per week, which would lead to 450,000 fewer children in poverty;
- then uprate child benefit in line with the cost of living; and
- return to universal child benefit - a child-centred guaranteed social security floor.