1.1 million more people face poverty at end of 2020

The IPPR think tank has warned that the economic fallout of the current coronavirus pandemic could leave 1.1 million more people below pre-virus poverty line at the end of the year.

Without urgent action to protect families from the financial hardship caused by the pandemic, the research claims that the 1.1 million figure includes a further 200,000 children, meaning that the total number of children living in poverty in the UK could reach 4.5 million - a five per cent rise.

IPPR finds that the number of children newly pushed into poverty since before the pandemic is likely to be 300,000 at the end of this year. This number is partially offset by the 100,000 children likely to have moved out of poverty, due to emergency reforms to the Universal Credit system introduced in March. The increase in child poverty is driven by expected falls in income for 800,000 households with children.

The 1.1 million total of people below the pre-coronavirus poverty line will be some seven per cent more than the 14.7 million projected, had the crisis not occurred.  

IPPR is calling on the government to include measures to support children and families as part of its planned economic stimulus package this summer. It argues that removing the two-child limit and the benefit cap, imposed in 2015 as part of the government’s austerity measures, combined with increasing Child Benefit by £5 per week per child, could entirely prevent the expected rise in child poverty - and could instead induce a modest fall.

Clare McNeil, IPPR Associate Director and head of its newly launched Future Welfare State programme, said: “This analysis shows that hundreds of thousands of families and their children who may have been ‘just about managing’ before Covid now face being plunged into poverty. The government must apply the same level of ambition it had for supporting businesses and workers in the early stages of this crisis, to prevent a new generation of children and their families falling into poverty through no fault of their own.   

“The Chancellor must include in this summer’s stimulus a package of measures to support families alongside funding for physical infrastructure and job creation. This should include removing the Universal Credit austerity measures, supporting family and carer incomes and investing in childcare to open up more options for parents to return to work.”