New analysis from the Foundation (JRF)
demonstrates the urgency of scrapping the two-child limit,
alongside a key reform to Universal
Credit.
A “protected minimum floor” would
introduce a safety net into Universal Credit below which no one
should fall, by limiting reductions made from debt deductions or
the benefit cap.
Families with children are currently
projected to endure the worst decline in living standards of all
family types during this parliament, but this combination of
policies would offset or even reverse the projected decline in average living
standards for
many.
Without action, couples with children
will see their disposable income fall by £750 on average by the
end of this parliament, while lone parents will see a drop of
£780, following falls in average incomes for both groups over the
last Parliament.
For couples with children the two
policies together would reduce the average decline in living
standards by a third (32%), meaning the reduction in disposable
income falls to £510. For lone parents the impact is far more
striking, with disposable income growing by £320
(1.2%).
By the end of the parliament, an
estimated 2.1 million children would be benefitting from these
policies. The approach would also lift half a million children
out of poverty and reduce poverty for another million by the end
of this parliament.
Katie Schmuecker, Principal Policy
Adviser at JRF, said:
“Children growing up in poverty is
neither acceptable nor inevitable. The government can lift the
two-child limit and improve the safety net within Universal
Credit and doing so would make a substantial difference to both
the child poverty numbers and the living standards of families
around the UK.
“With 4.5 million children in the UK
living in poverty, action on the two-child limit is long overdue.
As Labour marked a year in power, nearly 9 in 10 low-income
families with three or more children were going without the
essentials they need such as food, heating and
toiletries.
“These steps have been shown to be
effective, and should form a crucial part of the child poverty
strategy, due to be published this autumn, enabling it to deliver
ambitious progress on child poverty overall.
“The government is right to highlight
the need to reduce child poverty and to raise living standards.
This analysis shows an achievable route to delivering on both
those goals this autumn.”
The analysis from JRF also
found:
-
There are already 141,000 children
in families impacted by the two-child limit who are also
currently benefit capped, and this number will rise if the
two-child limit is removed. Children in these families will not
benefit from the removal of the two-child limit unless the
benefit cap is also
addressed.
-
Removing the two-child limit would
lift 300,000 children out of poverty by the end of this
parliament. Coupled with the introduction of a protected
minimum floor, 500,000 children would be lifted from
poverty.
Notes to
Editors
12 months into this government's
term our cost of living tracker found that for low-income families with three or more
children:
-
Almost 9 in 10 (88%) went without
essentials in the previous 6 months, compared to 82% of
families with fewer children.
-
Over 8 in 10 (82%) were in arrears,
compared to 66% of families with fewer children and 27% of
families without children.
-
7 in 10 (71%) held a loan taken out
to pay for essentials, compared to 60% of families with fewer
children.
