Stormont could cut child poverty by a third

More than one in four children in Northern Ireland will soon live in poverty.

However, by making two small adjustments to the local benefits system, the number of kids in poverty could fall to one in six, which would represent a “historic low”.

Those are some of the findings from new research by Save the Children NI and the Child Poverty Action Group (CPAG). Last week, the two organisations published Brighter Futures: the future path of child poverty in Northern Ireland, which found that the number of local children living in poverty actually fell during the worst of the pandemic.

In 2020-21, child poverty dropped by an estimated 1.5 percentage points to 23%, in large part due to the £20 increase to Universal Credit and Working Tax Credits, which has since been cut.

Various factors point to tough times for individuals and families over the next couple of years, including a slow economic and labour market recovery, a growing income and wealth gap - and a weakened benefits system.

Brighter Futures estimates that, as things stand, child poverty will grow fairly steadily until 2024-25, when it could breach 25%.

However, that figure could be as low as 17% if Stormont makes two changes to social security:

• Removing the two-child limit would mean 11,000 fewer children in poverty by 2024/25 and ensure child poverty in Northern Ireland stays below the pre-pandemic level.
• Introducing a £20 Child Payment for families eligible for means-tested benefits would lift 27,000 children out of poverty and secure a historic reduction.

By those projections, that would mean 38,000 fewer children living in poverty in 2025, compared with the current direction of travel.

Levers

One of the quickest moves from Westminster in response to Covid-19 was the introduction of the Universal Credit uplift.

In March 2020, Chancellor Rishi Sunak introduced a £20 per week – or just over £1,000 year – rise in entitlements that was due to last for one year and which was later extended for a further six months. That uplift was removed in September, in the face of voluble opposition.

This, alongside furlough and other measures, helped see child poverty fall during the pandemic. That situation on its own is enough to illustrate how transformative social security can be. This fact carries over to other levers within the overall welfare system.

The two-child limit was introduced in April 2017 and restricts systemic support to the first two children in a family. For the most part, it applies to families with children born after the measure was introduced. In Northern Ireland, it currently affects 10,000 families and, according the Save the Children and CPAG research, removing it immediately would lift 6,000 children out of poverty, at a cost of £27m.

The other proposal in Brighter Futures centres on what would be a new scheme, modelled on the Scottish Child Payment, with the report noting that “introducing a £20 Northern Irish Child Payment for children in families eligible for means tested benefits would lift 27,000 children out of poverty at a cost of £210m.”

Altogether these measures would see 33,000 fewer children living in poverty right now – a figure that would rise to 38,000 over the next three years.

Rachel’s story

Statistics are very useful in addressing poverty. They provide a sense of scale and a way to measure progress or regression. However, they cannot tell the whole story.

Brighter Futures includes the circumstances of several people helped by Save the Children during the pandemic. One such case study is about Rachel, a single mother who lives with her three children:

She is a full-time carer for a child with a disability. Rachel and her family receive financial support through Universal Credit, and they live in temporary accommodation in the private sector. 

The house they live in is unfit for them. It’s filled with damp, which has gotten so bad that it has ruined her children’s rooms, their furniture, and their things. The children’s rooms are unsafe for them to live in.

 “...the damp in the house is really bad and trying to get us out. Then [child] had to move out of his bedroom, and we are finding more now, the baby had to move out of her room too, and her bed is wrapped in plastic in the bathroom.” 

Rachel is putting almost all the money she does have into heating her home to help prevent damp and to keep it warm for her children. This is stretching her budget to the breaking point. It’s because of this that she must make choices between food and heating for her children.  

“...because the damp is so bad in the house, and because it’s so cold I could have the heating on all night and all day and it still wouldn’t get warm.”

The challenges Rachel is facing are putting huge pressure and worry on her and her family, but she is using the resources that she does have to keep her children’s lives as normal as possible.

What now

The Save the Children and CPAG report shows, in plain terms, the enormous consequences of even relatively small changes to welfare.

Specifically, it shows the positive impact that can be made by a strong social security system.

According to their research, two adjustments to NI’s welfare would be the difference between 17% of local kids living in poverty, compared with 25%.

Those adjustments might not be cheap, but they do sound like good value. Tens of thousands of children not living in poverty would be a massive win for public policy.

According to the report: “Without action, child poverty in Northern Ireland will rise in the coming years. This comes after a decade where no real progress has been made in reducing child poverty.

“But this paper shows that this isn’t inevitable. With the right investment, we can not only prevent a rise in child poverty but lift tens of thousands of children out of poverty…

“17% of children growing up in poverty should not be the end of our ambitions. However, it would signify a historic decline in child poverty and prevent thousands of children from being swept into poverty.”

The question for Stormont is whether a couple of percent of its annual budget is worth a one third reduction in local child poverty. Put in those terms, the answer should be easy.