Rachel Reeves is facing calls to introduce a “child lock” to protect spending on child-related benefits in the autumn budget, a move campaigners say would dramatically reduce the number of children in poverty.
In a report to be shared with the Treasury and ministers this week, Save the Children has called for a guarantee that benefits for supporting children are raised each year in line with inflation or average earnings, whichever of the two figures is higher.
The proposal is modelled on the pensions triple lock, which has been committed to by successive governments and protects pensioners’ incomes by ensuring state pension payments are raised annually in line with either inflation, average earnings or by 2.5% – whichever of the three is highest.
Save the Children says alock on child-related benefits could result in 80,000 fewer children living in poverty at the end of this decade. If that were coupled with scrapping the two-child benefit limit and overall benefit cap, 400,000 fewer children would be living in poverty in 10 years.
“No wealthy nation that is intent on growth can continue to have a child poverty rate this high. Child poverty is not bad luck, it is driven by systemic failure and political decisions,” said Meghan Meek-O’Connor, the child poverty policy lead at Save the Children UK, who authored the report.
“There is a chance now to start afresh and bring lasting change for children by protecting what is spent on them. The introduction of the pensions triple lock in 2010 was a pivotal moment in social security policy, ensuring that pensioners’ incomes were protected. We can, and should, do the same for children.”
The coalition government introduced the pensions triple lock in 2011. Save the Children calculated that if a child lock had been put in place at the same time, 345,000 fewer children would be in poverty today. If the two-child limit and benefits cap were not introduced, this figure would be 690,000.
The two-child limit, introduced in 2017, restricts support through universal credit (UC) or child tax credit to the first two children in a family, while the benefit cap, introduced in 2013, limits the maximum amount in benefits a working-age household can receive.
The new government’s approach to tackling child poverty, particularly its stance on keeping the two-child limit in place, has caused disquiet among some in the Labour party.
Keir Starmer faced the first rebellion of his premiership after seven Labour MPs voted in support of a Scottish National party amendment to scrap the two-child benefit limit. When the MP Rosie Duffield resigned from the party last month, she said in her resignation letter that the limit “entrenches children in poverty”.
In March, the Department for Work and Pensions said 4.3 million children in the UK were living in poverty. Analysis from the Child Poverty Action Group (CPAG) released earlier this month found at least 10,000 more children had fallen into poverty since Starmer took office.
Save the Children said the introduction of a child lock, alongside scrapping the two-child limit and the benefit cap, would cost the Treasury £6bn a year by 2034-35, just over half of the annual cost of the pension triple lock, which costs £11bn annually.
Under Save the Children’s proposals, the benefits that would be protected are: child benefit, a payment made to most families of £25.60 a week for their first child and £16.95 for each subsequent child; the child and childcare element of universal credit, the former of which goes to low-income families; and the child disability living allowance, which is not means-tested.
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Paul Trench, 39, a father of four from Gateshead, said: “I think the child lock is needed so every single child, regardless of background, postcode or parents is given the same opportunities in life.”
His youngest child is nine years old and his eldest is 21, and two of his children are disabled. He works as a charity adviser and his wife was previously a full-time carer.
His family is in receipt of child benefit. They also receive disability living allowance for one of their children and the child element of universal credit for three children. All of these benefits would be protected by the child lock.
“My daughter, who is 14, looks at the price of items per kilogram on the shelf when we go shopping to get the best prices. Even for our children, it’s in their focus too. We’ve tried our hardest to shield our children from this but you turn on the TV and its everywhere.”
He said he voted for Labour in July but had been “incredibly disappointed” so far. If no meaningful measures to alleviate child poverty were announced at the end of the month, he said: “I’ll be disappointed and devastated for those who it does affect and who are living in poverty.”
Carol is a single parent to a teenage son with special needs. She is self-employed and works 16 hours a week. She receives legacy child tax credit.
She said the current child-related benefits were not adequate to provide basic necessities such as food and clothing. “I know some families who have had to ration certain items, such as the number of sheets of toilet roll each member of the household uses, and many parents go without eating themselves so that their children have the nourishment they need.”
Save the Children said it was working on future proposals to protect annual government spending on education, mental health and housing.