The strategy is due to be published this summer, but Action for Children is concerned it will only focus on employment measures to improve parents’ income and ignore wider action needed.
Its research, published in its Paying the Price report, found that while “policies focused on employment have an important part to play in the strategy” they are “less targeted, less cost-effective and more uncertain in their impact”.
The charity believes this limited focus would only lift 150,000 children out of poverty by 2030.
Instead, the strategy needs to include “the single most cost-effective policy option the government could implement” of scrapping of the two-child limit and benefit cap, says Action for Children.
This would lift 600,000 children out of poverty by 2030 at a cost of £3.9bn a year.
But even this measure would still leave a quarter of children in poverty by 2035, warns the charity, which wants further reform, including increasing Universal Credit payments to families.
It estimates 1.2mn fewer children would be living in poverty by 2030 if the child-related elements of Universal Credit rose above the rate of inflation and there was an increased take up of means-tested benefits.
However, the charity adds that ministers would need to “pay the price” for this benefit uplift, which would cost £10.4bn over the next five years.
Further action called for by the includes building 90,000 social homes a year and reforming child maintenance to ensure it is being paid in full and fees are removed.
Implementing all the measures needed would see a return “to levels not seen since the 1970s when fewer than one in five children were in poverty”, says the charity.
Among those impacted by poverty is 24-year-old Louise, who lived in poverty as a child before being taken into care at the age of 11. As a care leaver and a single mother, she continues to struggle financially, even though she is in work.
“I was in my overdraft every month just to pay for childcare to keep my job,” she said.
“I relied on Universal Credit to pay my rent. That shouldn’t happen. I couldn’t work more than I did.”
Action for Children chief executive Paul Carberry added: “This research makes clear that a Child Poverty Strategy which focuses on boosting parents’ income through employment will barely shift the dial.
“If the government wants to keep its promise to significantly reduce child poverty and keep it down in the long term, this means scrapping the caps, boosting benefits and building more social homes too.
“In the current fiscal climate, there’s no doubt this will require difficult choices – but poverty has a price too.
According to the End Child Poverty Coalition three in ten children in the UK were living in relative poverty, after housing costs, in 2022/23.
This week the government announced an overhaul of the benefits system to save £5bn a year over the next five years.
Measures impacting young people include restricting the incapacity element of universal credit until the age of 22. New claimants will see this fall from £97 extra a week to £50 by next year.
Action for Children said that while it welcomes further measures around employment support it warns that cuts to the welfare bill will harm efforts to reduce child poverty.
Carberry said: “Instead of turning the tide on rising poverty levels, it risks plunging more families and children into crisis.”
