by Louise-Anne Geddes, Mindful Mum, 4th January 2012

The average income for families with children is projected to decrease by 4.2% between the period 2010-2015, which for a family with two young children means a drop of £1,250 per year by 2015.  The figures also demonstrate that families with more than two children and families with children under the age of five will be the worst affected.

Tax and benefit changes

The report also examines the impact of tax and benefit changes on different family and household types.  Households with children will lose 6% on average, compared with the 4% average for all households combined, and 3% for working age households with no children.

The figures show that families with children under five will experience significant financial impact. Between 2010-11 and 2015-16, 500,000 more children will fall into ‘absolute poverty’ as defined by the Child Poverty Act (2010), where the poverty line is fixed at 60% of the median income in 2010–11. 300,000 of these children come from households where the youngest child is under five. The median household with a child under five faces a drop in income of 4.9 per cent by 2015-16.

‘Penalised’ for having children

Chief Executive of The Family and Parenting Institute Dr Katherine Rake said:

“These figures reveal the full extent to which families with children are shouldering the burden of austerity. Having children has always been expensive. But now many families with children face an extra penalty of more than £1000.  Many families will be left struggling to understand why they have been singled out in this way and how this sits alongside the Government’s ambition for the UK to become a family friendly nation”.

The full report from the Family and Parenting Institute is available at the link below

Source: The Family and Parenting Institute, The Impact of Austerity Measures on Households With Children, 4 January 2012

Photography: Billy S @Flickr