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Child Poverty is the Policy

A Tory government might not have any moral qualms about pushing children into poverty. But if Labour can’t bring itself to oppose such an abhorrent policy, it doesn’t deserve power.

Child poverty for families with three or more children is set to reach 55 percent in 2027/28. (Photo by Jeff J Mitchell/Getty Images)

A decade of austerity, followed by a pandemic and a cost of living crisis, has brought millions of British families to the brink of destitution.  

According to the Resolution Foundation, 20 percent of people in the UK are not confident about their finances over the next several months, with the figure rising to 32 percent for those on low incomes and a shocking 43 percent for those not in work. 45 percent of all survey respondents are worried about paying their energy bills in the winter, rising to 63 percent for those on low incomes.  

A shocking 28 percent of people said they could not afford to eat balanced meals and 11 percent of people in the UK reported experiencing hunger in the last month because they had not been able to afford food, up from 9 percent and 5 percent before the pandemic respectively. 23 percent people on means-tested benefits experienced severe food insecurity over the winter.  

The only option for many has been to draw down on essential savings, or even take on new debts. 27 percent people in the Resolution Foundation’s survey had used savings to cover essentials over the previous month, while 12 percent resorted to pawning or selling their possessions to stay afloat.  

11 percent of survey respondents reported that their debt had increased moderately or substantially, rising to 20 percent among those on low incomes. As interest rates rise, the better off will benefit from increased returns on their savings, while the poorest will be forced to spend even more of their incomes on servicing their debts, potentially pushing millions into bankruptcy. 

All in all, non-pensioner incomes are predicted to fall by 3 percent in 2022/23, and another 4 percent in 2023/24, which would be the largest single-year fall in incomes since 1975. The impact of two successive years of falling incomes on this scale will make the coming years worse than those that followed the financial crisis of 2008. 

Poverty, already high, will continue to rise. Absolute poverty it set to rise from 17.2 percent in 2021/22 to 18 percent in 2023/24. Child poverty, meanwhile, will reach levels not seen since 1998/99 by 2027/28. Overall, 170,000 more children will be living in poverty by that point.  

While the general social and economic mismanagement of successive Conservative governments is what lies behind this astonishingly bleak outlook, there is one major reason why child poverty specifically looks set to increase to such an extent: the 2-child limit on child benefits, which prevents families from claiming child tax credit or universal credit for a third or subsequent child. 

The impact of the benefit cap shows up in the statistics. Child poverty for families with three or more children will reach 55 percent in 2027/28 based on current trends. Child poverty for families with four or more children will reach an astonishing 77 percent over the same time period. In fact, all of the predicted rise in child poverty is explained entirely by rising poverty among larger families. 

Historically, the response to this problem for the right would be to blame individuals for having too many children. This came with a hefty dose of classism and racism as working-class and ethnic minority families tended to have more children.  

The implication was always that poor families deserved to remain poor because they had more children than they could afford to sustain. In both the US and the UK, a moral panic about the ‘welfare queen’ who had multiple children before being given a house and extra welfare benefits by the state, facilitated a retrenchment in social security that lasted throughout the 1980s.  

But today, no such moralising is to be found on the right. Instead, Conservatives can consistently be found complaining about falling birth rates—both because of the impact this is likely to have on long-term economic growth and because it suggests a downward trend in Britain’s global influence. 

The UK fertility rate stands at around 1.6 births per woman, significantly below the so-called replacement ratio—the amount needed to maintain a stable population—of 2.1 births per woman. When the birth rate remains below this level for a sustained period, the population begins to fall in the absence of migration.   

The imbalance between the working-age population and everyone else is also a severe problem for our social security system. Contrary to the common misconception that people draw down pensions and benefits from the state that have been accruing through national insurance payments over the course of their lives, social security spending is funded through current spending.  

This means the taxes working people are paying today are going towards funding the retirement benefits being drawn down by the elderly. If the ratio of working-age to retired people rises substantially, the taxes paid by the former will have to increase to fund the benefits being drawn down by the latter. And when student loans are taken into account, many young people are already paying an astonishing 50 percent marginal rate of tax.   

Neither capitalism—which is premised upon constant growth—nor social democracy—which is premised upon population growth—can survive in their current form given current demographic trends.  

Conservatives will continue to moralise about the problem, blaming feminism or millennial selfishness. But the fact is, the reason people are not having more children is that they cannot afford to have more children.  

The housing crisis means that many families can barely afford to buy or rent homes large enough to accommodate one child, let alone two. And now, with the cost of everyday essentials like food and fuel having risen sharply while wages are held down, many families simply cannot afford to feed any extra mouths.  

In this context, it is increasingly rare to find working-class families in which one parent does not work—especially given the Tories’ astonishingly punitive workfare regime, which is designed to punish those unable to find work, including disabled people. Yet childcare in the UK is so expensive that there is barely any incentive for new mothers to re-enter the labour force because any new income will have to be directed towards childcare costs.  

The social security system should aim to fix—or at least alleviate—these challenges. And yet, as it stands, it is making everything worse. Not only does the government fail to provide adequate funding for childcare, the benefit cap is reducing incomes even further.  

This policy alone has affected 1.5 million children. Studies have consistently shown that it has had a negative impact on child poverty rates. Researchers at the End Child Poverty Coalition have shown that 25 percent of children in the country live in families that have been made at least £3,000 poorer as a direct result of the policy. Abolishing it would lift a quarter of a million children out of poverty and a further 850,000 out of extreme poverty.  

A Conservative government might not have any moral qualms about pushing children into poverty—though, as we have seen, it should at least be concerned about the impact on population growth. But if a Labour opposition cannot even bring itself to oppose such an obviously abhorrent policy, it does not deserve to win power.