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Working Parents on minimum wage unable to support families

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Working parents who are undertaking full-time hours for minimum wage are not earning enough to support their families, according to a new report.

Working Parents need 18% more just for basic living

‘The Cost of a Child in 2014’ report, published by Child Poverty Action Group (CPAG) and funded by the Joseph Rowntree Foundation, found that the cost of living has increased so much that the national minimum wage falls 18% short of the basic living costs needed. For out-of-work parents the short fall is a worrying 43%.

Author of the report and director of the Centre for Research in Social Policy at Loughborough University said, ‘The forecast increase in wages in the next few years should help, but may not reverse this trend for the worst-off working families. This is because the support they get from the state will continue to decline in real terms. So if items such as food, social housing and childcare continue to become more expensive, it is unlikely that these families’ overall incomes will keep up.’

Childcare costs increase by 42%

One huge expense that many families have to pay for is childcare which has increased by 42% between 2008 and 2014. Excluding childcare, rent and council tax, the cost of raising a child for a couple is £88.84, 1 4.3% rise since 2012. When including childcare, rent and council tax couples are expected to pay £164.19, a 7.7% rise.

Lone parents are being put under even more financial pressure as raising a child will cost them around £103.53 per week (9.7% rise) excluding childcare, rent and council tax and £184.50 per week (11.4%) including those costs.

Out of work families struggling the most

Families living on out-of-work benefits face an even greater challenge to make ends meet, receiving only 57% of the total income required to meet basic needs.working parents

Chief executive of CPAG, Alison Garnham believes this struggle is one many parents will relate to. She continues, ‘Children cost. That is why families with children have a higher risk of poverty than those without. The most recent statistics show 27 per cent of children live in poverty in the UK, and with declining levels of support for families, child poverty can only increase.

‘The cumulative impact of low pay and cuts to family support contribute to the remarkable finding that the combined wages and benefits of a family with both parents working full time on the minimum wage are still insufficient to meet the basic needs of that family. It is difficult to see how this can be justified or why no political party has set out policies to address this as a matter of urgency. We need a government prepared to work flat out to help parents if we are to protect children’s childhoods and life chances from poverty.’

Working parents trapped in poverty

Katie Schmueker, the policy and research manager at the foundation, also said: ‘We need to get to grips with the high cost of living and the low pay jobs market which traps parents in working poverty.

‘Reforms under Universal Credit go some way to helping parents, but this needs to be part of a comprehensive anti-poverty strategy.’

A spokesman for the Government has also said: ‘The Government’s long term economic plan to build a stronger economy and a fairer society is working, delivering the fastest growing economy in the G7 and more people in work than ever before. The only way to secure rising living standards is to fix the economy. The effects of the great recession are still being felt and so where possible we’ve acted to help including by lifting over 3million people out of paying income tax altogether, providing free school meals, and tax-free childcare to up to 1.9million families.’

 

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About Siobhan Harmer

About Siobhan Harmer

Siobhan Harmer is an English Freelance writer who drinks far too much coffee!!

Website: Siobhan Harmer

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