'Cost of children crisis' must be taken into account, warn children's charity

A charity claims there's a 'cost-of-children crisis’, with some parents having to go without food to help feed their kids.

Action For Children claim 1 in 5 families with kids are now classed as being in ‘serious financial difficulty’ as they struggle with bills and debt repayments.

Paul and Fiona - who live in Devon and have two daughters aged 11 and six - have been sharing their story with us. They both have long-term health conditions which means they can’t work so they are forced to live entirely on benefits.

Paul said: ‘We’re struggling to afford groceries now. The weekly bill for our family - just the basics and value brands - has gone up so much.

‘We have been grateful for the inflation increase in benefits earlier this year, but it simply doesn’t go nearly far enough. It doesn’t come close to covering the rise in costs of everything. Benefits have increased, yes, but much less than the costs of living have. Our rent has gone up a lot, but the housing benefit hasn’t increased at all because we are already at the maximum the local council deems necessary. So that already puts us £200 a month worse off, just in rent. We need an extra bedroom for our daughter who has additional needs, but we can’t afford it.’

Fiona said: ‘Our monthly outgoings now are more than our income, and with neither of us able to work because of long term health conditions and caring for our daughter, we can’t improve this situation which is very distressing. My mental health suffers because of the stress. Budgeting is so tight and it’s a struggle to keep on top of it. It’s not difficult to see that when your outgoings are more than your income, you will quickly end up in a debt spiral - and when you can’t do anything to improve that situation, it’s terrifying. The rainy day savings we have we use to buy essentials, and they’re fast running out.

"The cost-of-living payments have been useful to our family, but it seems very short sighted to keep the amount that gets paid the same for all qualifying people, without taking into account individual circumstances, even ones as basic as family size."

In response a Government spokesperson said: “Our welfare system provides a strong financial safety net for those who need extra support, and there are nearly two million fewer people in absolute poverty than in 2010.

“But we know some families are struggling, which is why we have raised benefits by over 10% this year, are focused on halving inflation, have provided record financial support worth around £3,300 per household, and have announced another increase to the National Living Wage.

“To help people out of poverty through work, we are investing £3.5 billion to help thousands into jobs and are removing barriers for parents with the biggest ever expansion of free childcare – providing 30 free hours of childcare for working parents and support for children from nine months old to when they start school. This will save eligible parents up to an average of £6,500 per year.”

Analysis of survey data from over 5,000 UK households shows that in May 2023, one in five (19%) families with children were classed as being in ‘serious financial difficulty’ - the most severe form of financial insecurity.

Action For Children is calling on the government to 'protect low-income families by increasing social security levels in line with inflation at the Autumn Statement and to reform future Cost of Living Payments to take family size into account'.

The charity also wants to see family incomes boosted further through an increase to the child element of Universal Credit and a scrapping of the Benefit Cap, both of which would lift more than 300,000 children out of poverty.

Paul Carberry, chief executive at Action For Children, said: ‘Our stark findings show the UK is in the midst of a cost-of-children crisis, where a parent penalty premium makes every day a battle for low-income families just to stay afloat.

"With more mouths to feed, clothes to wash, rooms to heat and typically fewer savings, families with children are especially vulnerable to financial shocks, and that pressure is being felt most by those on low-incomes, and single parents in particular.

"The cost-of-living crisis is far from over as prices across the economy are still rising with food inflation remaining particularly high at almost 14%. The Bank of England does not expect to reach its 2% inflation target until early 2025, and energy prices remain volatile and stubbornly high as winter draws near.

"Every day, our frontline workers are applying to our Crisis Fund for emergency grants to support low-income families in their care with basics like food, clothing and utility costs. The Chancellor must act at the Autumn Statement to protect families with children from these intense and ongoing pressures on household finances. At the very least, we must see benefits rise with inflation and Cost of Living Payments reformed to take family size into account."

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