Charity Says Parents on National Living Wage ‘Can’t Afford Basic Lifestyle’

Research by charity Child Poverty Action Group suggests low-earning parents are still unable to provide their families with ‘a basic, no-frills lifestyle’

The report by the Child Poverty Action Group (CPAG) was released this morning, and shows what it costs to raise a child (up to the age of 18) based on what the public consider is a minimum standard of living.

According to the charity, the overall cost of a child, including rent and childcare, is £150,753 for a couple and £183,335 for a lone parent.

CPAG found that families with two parents working full time on the national living wage are £49 per week short of the income defined as an “acceptable, no-frills living standard”. While a lone parent on the national living wage will be £74 per week short.

Currently in the UK, the national living wage is £7.83 per hour for workers 25 years or older, though it has been said this will be increasing to £9 per hour by 2020.

A Government spokesperson speaking with BBC has said that fewer families are living in “absolute poverty”.

“The employment rate is at a near-record high and the National Living Wage has delivered the highest pay increase for the lowest paid in 20 years, worth £2,000 extra per year for a full time worker.”

However, the report states that “a combination of rising prices, benefits and tax credit freezes, the introduction of the benefit cap and two-child limit, the bedroom tax, cuts to house benefits and the rolling out of universal credit have hit family budgets hard.”

“Life has been getting progressively tougher for families on low or modest incomes over the past 10 years, with families on in-work and out-of-work benefits hardest hit.”

Our #costofachild report, by @donaldhirsch of @lborouniversity, finds that two parents working full time on the minimum wage are 11% short of what they need to give their two kids a no-frills standard of living. pic.twitter.com/FXRPBALhx8

— Child Poverty Action (@CPAGUK) August 20, 2018

Report author, Professor Donald Hirsch, Director of the Centre for Research in Social Policy concludes the report with an emphasis on how difficult life can be for families on low income, particularly those with three children.

“The benefit cap is making any concept of safety net for such families, if they are not working, a fiction. Under present policies, a couple with three children and no work and in privately rented housing will soon have barely a third of what they need to meet their costs.

“For those larger families not hit by the benefit cap - including some lone parents in social housing and most working families - the two-child policy will also have dramatic effects on future outcomes” he writes.

“Thus, while the story in the first Cost of a Child report in 2012 was largely about how recent inflation had raised the level of these costs, today the most important finding is that the ability of families to afford these still-high costs has been eroded by restrictions on their incomes.

“This is having profound consequences, in terms of hardship, in families who have nowhere near enough to make ends meet.”

My latest cost of a child report for @cpaguk highlights how much family costs are influenced by the complex system for funding childcare, and also the particularly dire prospects for larger families as state support based on family size is withdrawn. https://t.co/KuN17mriKo

— Donald Hirsch (@donaldhirsch) August 20, 2018

What constitutes a ‘no-frills’ lifestyle?

The definition of a ‘no-frills lifestyle’ is based on the Minimum Income Standard, a set of criteria drawn up by the Centre for Research in Social Policy at Loughborough University.

It calculates the income required for a minimum standard of living, based on essentials including food, clothes and accommodation, as well as “other costs required to take part in society”.

According to the CPAG, the cost of bringing up children was heavily influenced by childcare, with full time childcare accounting for nearly half the total sum.

CPAG Chief Executive Alison Garnham has said that there was “strong public support” for the Government to top up the wages of low-paid parents.

“Income from work alone is not sufficient to enable some to meet their families’ needs to escape poverty and the cost of a child is substantial” she says.

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Read the full Cost of a Child report.

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