New ‘Cost of a Child in Scotland’ research finds rising costs outstrip additional Holyrood support for families

  • Campaigners urge Finance Secretary to use Scottish budget to ‘double down’ on child poverty investment.
  • Rising costs and real terms UK benefit cuts leave low-income families in Scotland up to 40% below what they need.
  • Holyrood policies are working – gap between costs and income rises to over 50% in rest of UK, but more is needed to protect families and meet Scottish child poverty targets.
  • UK government must invest in social security to reverse long-term damage to living standards, starting by scrapping the two-child limit and benefit cap, and increasing child benefit by £20 a week.

A new report commissioned by the Child Poverty Action Group (CPAG) in Scotland from the Centre for Research in Social Policy at Loughborough University has found a widening gap between the cost of raising a child in Scotland and actual family incomes, despite the significant impact of Scottish government policies and lower childcare costs.

The report builds on calculations which find that across the UK it costs at least £160,000 to bring up a child at a socially acceptable standard of living. However, inflation and real-terms cuts to UK benefits mean that, for example, out of work families with children now receive under half what they need through universal credit and child benefit. In Scotland, families benefit from a range of Holyrood policies, including the new Scottish child payment, to reduce these costs and to improve incomes. Alongside cheaper than average childcare this can reduce the net cost of bringing up a child by over a third for low-income families.

The report warns that in the past year, rising costs have made incomes less adequate relative to families’ needs throughout the UK. The shortfall has risen from around 30 per cent to 40 per cent below needs in Scotland, and from over 40 per cent to over 50 per cent elsewhere in the UK.  

"Gap between family incomes and the minimum cost of raising a child is widening horribly"

John Dickie, Director of the Child Poverty Action Group in Scotland, said

“This important analysis confirms that Scottish government policies are making a big difference to families. But the harsh reality is that soaring inflation and real terms UK benefit cuts means the gap between family incomes and the minimum cost of raising a child is widening horribly. It is absolutely vital that the Finance Secretary uses this week’s Scottish budget to double down on support for children. At the very least he needs to ensure the Scottish child payment and other Scottish benefits hold their real terms value next year. Given the pressure on his budget he must also use his tax powers to increase the resources available to him to deliver the social security, childcare and employment actions that are needed to meet his government’s child poverty targets.”

“Worst year in memory for the living standards of families on low incomes”

Donald Hirsch, Emeritus Professor of Social Policy at Loughborough University and co-author of the report, commented:

“2022 has been the worst year in memory for the living standards of families on low incomes, with costs soaring and benefits falling badly behind. It is unfortunate that the extra Scottish help, especially through the Scottish Child Payment, has only reduced the damage done, rather than making families better off overall. Nevertheless, the policies are having a big impact in these terms, and show that it is not just UK-wide policies that can make a difference to social security.”

Notes

CPAG media centre

  1. The Cost of a Child in Scotland 2022 report
  2. The Cost of a Child studies are based on the Minimum Income Standards research which entails a sequence of detailed deliberations by groups of members of the public, informed by expert knowledge where needed. The research process involves agreement being reached by groups of members of the public, and then checked and rechecked by subsequent groups. Each group has detailed discussions stating its rationale for what should be included in a minimum household budget. The standard thus represents a considered, settled agreement on what is the minimum needed, rather than just a collection of subjective opinions held by individuals. See further information. Donald Hirsch was Director of the Centre for Research in Social Policy from 2012 to 2022. Juliet Stone is senior research associate at CRSP.
  3. CPAG in Scotland is calling on the Finance Secretary to use the Scottish budget to:
  • Ensure the Scottish child payment and the other four Scottish family benefits at the very least retain their real terms value, through an above inflation increase in April 2023.
  • Make additional payments of Scottish child payment to address the impact of the two-child limit.
  • Ensure sufficient resources to fund Scottish social security and wider measures in its statutory child poverty delivery plan - Best Start, Bright Futures.
  • Make full use of Scotland tax powers to ensure adequate resources are available to deliver all actions in the statutory child poverty delivery plan - Best Start, Bright Futures.
  • Provide sufficient funding to local authorities to mitigate the benefit cap as fully as possible.
  • Provide sufficient investment to fund expansion of income maximisation and advice services.
  • Provide sufficient resources to roll out free school meals to all primary school pupils from April 2023.
  • Ensure that schools have sufficient resources to deliver Scottish government commitment to: provide every child with a device and connectivity; remove all costs for curriculum related trips and activities; ensure all pupils are able to attend ‘rite of passage’ trips, such as P7 residentials; and introduce minimum entitlement for all secondary pupils to attend at least one ‘optional’ trip during their time at school.
  • Make further investment in the Scottish Welfare Fund and its administration and promotion.