Child poverty reduced to lowest level in 25 years

May 12, 2011

Commenting on the new child poverty figures for 2009/10 announced today, the Chief Executive of Child Poverty Action Group, Alison Garnham, said:

“It is great news that child poverty fell during what was a terribly hard year for families and the economy. The investment in extra support for low income families worked, which means British people will avoid some of the social and economic costs that followed the recession and cuts in the 1980s.

“The fall in material deprivation for children after the worst recession for decades shows that direct financial support for families improves children’s wellbeing, even in tough times.

“These are the final figures for the previous government’s time in office. David Cameron must keep his promise to make British poverty history and make sure the fall in child poverty continues. But cuts to public services, tax credits and childcare support mean fewer people will be better off in work, with fewer jobs to go round. Experts like the Institute for fiscal Studies are warning that the Government’s cuts will make child poverty go up again.

“The big question now is, why doesn’t the Prime Minster’s new child poverty strategy say how many children will be lifted out of poverty? Are they hiding bad news? Without robust action to tackle problems like lack of jobs, poverty pay, unaffordable childcare and Britain’s critical shortage of social housing, the Government’s strategy lacks credibility.”

Notes for editors
  • CPAG is the leading charity campaigning for the abolition of child poverty in the UK and for a better deal for low-income families and children. We are the lead member of more than 150 organisations in the Campaign to End Child Poverty, campaigning for public and political commitment to ensure the goal of ending child poverty by 2020 is met.
  • The last time UK child poverty (before housing costs) was at 20% was 1984. Between 1960 and 1980, child poverty was typically between 10% and 15%. Since the baseline year for the target shared by the previous and current government, child poverty has fallen by 800,000* to 2009/10 and by close to a million for the IFS estimated figure for 2010/11. But the IFS estimate it will start rising again as the Government’s cuts start to bite.
      Millions % of children
    Baseline year: 1998/99 3.4 26%
    Latest figures: 2009/10 2.6 20%
    IFS estimate: 2010/11 2.5 -
    IFS estimate: 2013/14 2.7  
    Coalition’s 2020 target - below 10%

    *Sources: HBAI 1998/99-2009/10 (rounded figures before housing costs); Children and Working-Age poverty from 2010 to 2013, IFS 2010

  • Cuts to in-work and other tax credits and benefits implemented from April 2011:
    • Sure Start Maternity Grant limited to first child only
    • Child benefit rates frozen for three years
    • Other benefits (except state pension) to be uprated using Consumer Prices Index (CPI)
    • Housing benefit (HB) in private rents to be reduced for new claimants
    • capped nationwide
    • four-bedroom limit
    • reduced from median to 30th percentile
    • removing £15 excess for claimant whose rent is lower than the local housing allowance
    • Deductions from HB for other adults in the property to increase
    • Discretionary Housing Payments increased
      Tax credits:
    • Baby element (extra £545 a year) will be removed
    • Family element to be withdrawn from families on more than £40,000
    • Withdrawal rate to be increased to 41 per cent
    • Disregard for in-year income rise reduced from £25,000 to £10,000
    • Childcare costs to be cut from 80 per cent to 70 per cent
    • Basic and 30-hour elements of working tax credit frozen for three years
    • People over 60 eligible if working 16 hours
    • Child element to be increased by £180 above CPI
  • A baby born to a low-income family from April 2011 will be around £1,500 worse off compared to a sibling born in April 2010 (Loses £190 Health in Pregnancy grant, £500 maternity grant, £500 Child Trust fund, £545 baby element – gains £255 in child element of child tax credit)

For further information please contact:

Tim Nichols
CPAG Press Officer
Tel. 020 7812 5216 or 07816 909302 
tnichols@cpag.org.uk