What causes child poverty?

In the UK, there are 3.6 million children living in poverty¹. For some children, the risk of poverty is greater as a result of their circumstances:

• what increases the risk of poverty?
• 5 groups that are more at risk from poverty than others
• further reading.

What increases the risk of poverty?

The graph demonstrates that by far the greatest risk of poverty is for those who live in a family where no one is in work.

However, other important factors include:

• ethnicity
• living in social housing
• being in a lone parent family.

Where you live can also affect your risk of living in poverty

Children in London, the North East, North West, West Midlands and Wales have the highest risks of living in poverty.

5 groups that are more at risk from poverty than others

In the Barnardo's report It Doesn’t Happen Here, five groups were identified as being more at risk of suffering from poverty than others²:

1. lone parents
2. large families
3. parents or children with disabilities
4. black and minority ethnic groups
5. working families  
6. Other vulnerable groups, including asylum seekers, workless households, young people living independently and children living in poor housing.

1. Lone Parents

In lone parent households, 41 per cent of children are living in poverty, compared to 23 per cent in two parent families¹. Much of this is due to high levels of worklessness and low out of work benefits: A lone parent with two children, one aged 14 and the other aged five, needs £258 to take them above the after housing costs poverty line. The amount of benefit that this family would get if the parent was out of work is £219, which is well below the poverty line².

Additionally, some lone parents often feel isolated and lack confidence. They may also experience poor physical and mental health and be socially excluded. More needs to be done to help lone parents to overcome the psychological barriers that prevent them from getting back into work.

In 2009, while the employment rate for lone parents was improving, 42 per cent of those actively seeking work said the scarcity or cost of childcare prevents them from getting a job³. Whilst the provision of affordable childcare has improved, there is still a lot of work to be done to help support lone parents into getting back to work.

2. Large families

Within large families with three or more children, 35 per cent of children are living in poverty, compared to 24 of children from families with two children and 26 per cent of children from one-child families¹.

Large families can often struggle to meet the costs of school uniform and equipment, and are also at particular risk of going into debt. They also have higher rates of worklessness than for parents in smaller families, which is largely due to a lack of affordable childcare⁴.

Evidence also suggests that mothers of five or more children who do work earn significantly less per than mothers with smaller numbers of children⁵.

3. Disabilities

Over a million children living in poverty are affected by disability. Having either an adult or a child with a disability in the family increases the chances of being in poverty. Within families with a disabled child and a disabled adult, there is a 34 per cent risk of child poverty, compared to 25 per cent where no one in the family has a disability¹.

The cost of living is considerably more for a family with disabled children. It has been calculated that it costs on average, an additional £99.15 a week to bring up a disabled child and that benefits are not enough to cover these extra costs⁴.

4. Black and minority ethnic groups

Within Black or Black British households, 47 per cent of children live in poverty. This rises to 58 per cent in Pakistani and Bangladeshi households, compared with 26 per cent in White households¹.

Worklessness is one of the key drivers for higher poverty rates for some ethnic minority groups. The UK overall employment rate, about 71 per cent of working age adults, falls to 60 per cent when looking at working age adults from minority ethnic groups⁶.

Educational achievement is an important factor in poverty rates amongst ethnic minority groups. The achievement gap between white pupils and their Pakistani and African-Caribbean classmates has almost doubled since the late 1980s.

In-work poverty rates are also higher for many ethnic minority households, particularly Pakistani and Bangladeshi ones⁷.

5. Working families

The Government's main strategy for tackling poverty is to increase employment rates. Despite this, more than half of all children (58 per cent) in poverty live in homes where at least one of the adults work¹. Families with children are more likely to experience working poverty than those without. A large part of the problem is that many families are surviving on low pay in jobs where there is little chance of progressing. This means that low-paid workers tend to stay low-paid, which keeps them trapped in poverty.

Working households headed by younger people, those from ethnic minorities and those that include a disabled adult also face higher risks of poverty.

Other vulnerable groups include:

Asylum seeking families: Asylum seeking families and their children are among the most disadvantaged groups in the country. The asylum and immigration law appear to be more concerned with children's immigration status than their needs as children. Asylum seeking families are not allowed to apply for permission to work for the first 12 months of their application. Not only does this force them to rely on state benefits but denies them the chance to integrate into their community and reduces the chances of them finding employment if they are given refugee status. Adult benefit payments are set at only 70 per cent of Income Support levels.

Workless households: The UK has the highest proportion of children whose parents do not work, compared to other European countries. Low out-of-work benefits mean that most of these children are poor.

Young people living independently: Young people aged over 16 who do not get family support are much more likely to be poor and as adults to remain dependent on benefits or low paid work. Young people receive less benefit and have a lower minimum wage than older adults. Young people receive less income support, are ineligible for tax credits, and are restricted to a lower level of housing benefit. Children leaving care are particularly vulnerable to poverty as young adults and are less likely than other young people to remain in education after leaving care, which can affect their future prospects.

Children living in poor housing: There is a shortage of affordable housing due to high rents in the private sector and a lack of investment in maintaining a good standard of social housing. Children who live in bad housing are more likely to suffer from poor health, and to suffer from disability or long term illness. Additionally, they are also more likely to dislike the area that they live in and to have run away from home. Children living in poor housing often have poor educational attainment. They are more likely to have been excluded from school and to leave school with no GCSEs.

¹ Department for Work and Pensions, 2012, Households Below Average Income 2010/2011. Figures are after housing costs.

² Barnardo's calculation based on Jobseeker’s Allowance, Child Benefit and Child Tax Credit rates from April 2012.

³ The Daycare Trust

⁴ Barnardo's (2007) It Doesn’t Happen Here: The reality of child poverty in the UK

⁵ The Daycare Trust

⁶ Office for National Statistics (Feb 2011) Labour Market Status by Ethnic Group

⁷ Gottfried G and Lawton K (2010) IPPR Briefing Note: In-Work Poverty in the Recession