The high levels of child poverty in the UK are currently costing the country at least £29 billion a year – or £1,098 per household – according to new research released today by Donald Hirsch of Loughborough University (updating his 2008 study for the Joseph Rowntree Foundation).
The estimate includes the costs of policy interventions required in childhood to correct for the effects of poverty, as well as the longer term losses to the economy which result from poor children’s reduced productivity, lower educational attainment and poorer physical and mental health.
The research, conducted by Donald Hirsch, Director of the Centre for Research in Social Policy at Loughborough University, estimates the current cost of child poverty to be £29 billion a year. The drivers of the costs are:
- £15 billion spent on services to deal with consequences of child poverty (e.g. social services, criminal justice, extra educational support)
- £3½ billion lost in tax receipts from people earning less as a result of leaving school with low skills, which is linked to having grown up in poverty
- £2 billion spent on benefits for people spending more time out of work as a result of having grown up in poverty
- £8½ billion lost to individuals in net earnings (after paying tax)
The research also shows that if child poverty rises by a quarter from its current level, as the Institute for Fiscal Studies has recently projected may happen by 2020 as a direct result of the government tax and benefit decisions, the cost to the country would increase to at least £35 billion every year. [.]