‘Families with under fives face big income cut if benefits don’t rise with inflation’

Over a million children under five could see big cuts in their household income if benefits are not uprated in line with inflation on Thursday, says the Child Poverty Action Group.

Children playing


Department for Work and Pensions figures published this week show four million children are in households claiming Universal Credit and face big income cuts if benefits are not uprated with inflation in Thursday’s Autumn Statement.

Twenty nine per cent (1.15m) of these children are aged four or younger. The Child Poverty Action Group (CPAG) says the Government must use the Statement to stop more children from being pulled into poverty by uprating benefits with inflation.

New analysis from CPAG finds that while prices will be 17% higher for all households in 2023/24 compared to 2021/22, low-income households will see a 21% rise in prices because they must spend a much higher proportion of their income on necessities like energy and food which have risen most sharply.

Working couples on Universal Credit with two children would be £752 worse off in 2023/24 if benefits rise with wages (5.4%) rather than inflation (10.2%), says CPAG. Working lone parents with two children would be £654 worse off.

Alison Garnham, Chief Executive of Child Poverty Action Group, said: “Children are going hungry because family budgets are at snapping point. This problem has been long in the making and in the current crisis another real-terms cut is indefensible. The Prime Minister has said he will protect the most vulnerable – as a minimum that means uprating benefits with inflation so that children have enough food and warmth this winter – but longer term more will be needed. Trading children’s health for efficiency savings cannot be an option.”

A new CPAG Briefing ahead of the Autumn Statement calls on the Government to make a range of reforms to reduce child poverty – including introducing comprehensive support with energy costs for low-income families, increasing child benefit, expanding free school meals eligibility, abolishing the two-child limit in universal credit and tax credits and removing the benefit cap.

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