Budget 2008: Child benefit rises but poverty target is 'ditched'

Budget 2008: Child benefit rises but poverty target is 'ditched'


By Sarah Womack, Social Affairs Correspondent
Last Updated: 12:42AM GMT 14 Mar 2008

Child benefit for all parents will increase a year earlier than planned as part of a £1.7 billion package to lift 250,000 more children out of poverty.

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Payments for a first child will increase to £20 a week from April 2009, rather than April 2010. They now stand at £18.10, rising to £18.80 next month.

The above-inflation increase of 6.4 per cent will cost the Treasury £210 million. But critics said the Budget would really be remembered as "the day the Government abandoned its target to halve child poverty", by investing less than a third of what was necessary to reach its stated 2010 goal.

Child benefit for second and subsequent children will remain at £12.55 to which it rises next month from the current £12.10. From April 2009, mothers-to-be will become eligible for the first time for child benefit, beginning at week 29 of their pregnancy.

The child element of the child tax credit for families on low and middle income will also rise - by £50 a year above inflation from April 2009, leaving those with two children and a household income below £28,000 more than £130 a year better off.

Parents' income from child benefit will also be disregarded when calculating housing and council tax benefits, saving a low-income working family with one child £17 a week. Mr Darling said this would help ensure that parents were better off in work than on benefits.

The changes, which will cost the Government around £900 million a year, came as the Chancellor sought to reassure welfare campaigners he had the funds to abolish child poverty by 2020.

Ministers define the child poverty target as ensuring that no children live in a household earning less than 60 per cent of national average income before housing costs. As the Office of National Statistics says that the average income was £24,000 in 2007, this means any child in a household where the annual income is less than £14,000 is reckoned to be in poverty.

Some 600,000 children have been lifted out of relative poverty since 1999, but experts warned that the Government was off track for its 2010 target of 1.7 million.

The Labour left-winger John McDonnell accused Mr Darling of "admitting defeat". He added that, even on the Chancellor's own figures, today's plans would leave 2.5 million children in poverty by the end of the decade, missing the target by 800,000.

The TUC joined the criticism, saying the Government needed to invest £3.4 billion to have a 50 per cent chance of hitting its 2010 target.

Instead, the Budget offered £10 million in 2008-9, £765 million in 2009-10 and £950 million in 2010-11. It was therefore likely the Government would fall short of its 2010 target by 450,000 children, it said.

Save the Children said it was worried that Mr Darling's investment "does not match his ambition".

The Liberal Democrats' Danny Alexander said children in the poorest families would have to wait until next year for even the small scale and highly complex changes announced by Mr Darling to take effect.

"To keep its promise the Government should introduce seasonal grants of £100 per child for the poorest families, and an extra £100 per family in winter to help with costs like fuel," Mr Alexander said.




Budget 2008: Child benefit rises but poverty target is 'ditched' - Telegraph
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