200,000 more children to be pushed into poverty by government bill

17 January 2013

The government has revealed in answer to a parliamentary question that 200,000 children will be pushed into relative income poverty by its bill to cut social security benefits and tax credits in real terms. This results from a restriction of annual uprating to just 1%, which is below inflation.

It is effectively a real terms cut of 4% if the inflation projections the government uses are right. But claimants are also hostage to fortune if inflation goes up even higher than those predictions, especially for food and for gas and electricity bills, as well as other basics like transport costs.

The answer the government gave also reveals major downward revisions to the poverty-reducing impacts that had previously been claimed by Ministers for Universal Credit. Previously the Secretary of State, Iain Duncan Smith, had estimated the Universal Credit would directly reduce child poverty by 350,000 children, but this has now been revised down to just 150,000.

The bill will mean Coalition policies are set to increase child poverty by at least a million children by 2020, net of the Universal Credit impact and on the relative income measure.

The government has failed to release details of the impact on the absolute child poverty measure, even though the key debate in parliament will take place just a few days from now.

For more details, see the CPAG press release.