Three quarters of children in poverty live in a working household

Child poverty hit a record high shortly before the Covid-19 crisis, “shameful” new government figures show, rising by 200,000 kids to 4.3 million over all.

The 15 per cent rise between 2019 and 2020 was despite a £20-per-week increase in the average UK income.

And as many as 3.2 million children in poverty – three quarters of those whose families were facing financial hardship – lived in households with at least one working adult.

“It is shameful that three quarters of children in poverty live in a working household. This is simply not acceptable in modern Britain,” said Jonathan Reynolds MP, shadow work and pensions secretary.

“The Conservatives’ answer to hundreds of thousands of working households living below the poverty line is a triple hammer blow of Universal Credit cuts, council tax rises and public sector pay freezes,” he said, adding that Labour would replace Universal Credit with a “fair and compassionate” system.

The annual household income figures from the Office for National Statistics show that the median income after housing costs in the UK was £476 per week to the year ending March 2020, up from £455 a week the year before.

The number of kids living in relative low income households – meaning their family’s income was below 60 per cent of the year’s median income, around £328 per week – grew by around 420,000, from 2.8 million to roughly 3.2 million, the Government’s Households Below Average Income data showed.

“Today’s poverty figures show what was clear all along, that low-income families with children entered the pandemic financially vulnerable,” said Alison Garnham, chief executive of the Child Poverty Action group.

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“Despite child poverty having fallen prior to 2010, we have now seen a decade of cuts to our social safety net and entered the pandemic expecting to spend £36 billion a year less on social security so it is no surprise that child poverty has risen,” she added. “We badly need a cross- government strategy to end child poverty and increasing child benefit should be the first action point.”

Nearly 60 per cent of people living in poverty, or 8.3 million people, were in working families, the figures show.

The data suggests more families were struggling to make ends meet before Covid-19 hit the UK and sent the country into its deepest recession since records began.

“Hard work should pay off for everyone, no matter who you are or the job you do. But millions of Britain’s workers are denied a fair share of the wealth they create,” said Frances O’Grady, general secretary of the Trades Union Congress (TUC).

“The Prime Minister keeps talking about levelling up – let’s see it for the low paid. Get the minimum wage up to £10 an hour without delay. And give key workers the pay rise they earned.

Overall income inequality was relatively unchanged, but “material deprivation” – which refers to the inability to afford basics such as food and heating – increased, including for another 140,000 children. This means around 1.7 million children total are forced to go without essentials.

Upping pay for workers would be key to the country’s recovery from the pandemic as well as lifting struggling families out of poverty, O’Grady said. 

“This isn’t just about doing the right thing for workers. High streets and business won’t recover if people have nothing to spend. Pay growth is fuel in the tank. It will drive our recovery much faster, supporting business growth and job creation.”

The Government must increase the minimum wage to at least £10 an hour, the TUC said, as well as making the weekly £20 Universal Credit increase permanent and increasing statutory sick pay.