More families using informal lenders amid high inflation

High inflation has led to financial hardship for families according to the charity’s analysis of abrdn’s Financial Fairness Trust’s survey.

• The Community Organisations Cost of Living Fund

• Councils dig deep to help children and families below poverty line

The data reveals that families with children are three times more likely to be behind on bills or debt repayments and twice as likely to be behind on rent and mortgage repayments or to have gone without food.

One in five families with children are also classed as experiencing the most severe form of financial insecurity.

Action for Children has called on the government to increase social security payment rates in line with inflation and to take family size into account when making cost of living payments.

It is also suggesting that the child element of universal credit is increased and the benefit cap is scrapped, which would lift 300,000 children out of poverty.

Paul Carberry, chief executive at Action for Children, said: “With more mouths to feed, clothes to wash, rooms to heat and typically fewer savings, families with children are especially vulnerable to financial shocks, and that pressure is being felt most by those on low-incomes, and single parents in particular.

"The cost-of-living crisis is far from over as prices across the economy are still rising with food inflation remaining particularly high at almost 14 per cent.

“Every day, our frontline workers are applying to our Crisis Fund for emergency grants to support low-income families in their care with basics like food, clothing and utility costs. The Chancellor must act at the Autumn Statement to protect families with children from these intense and ongoing pressures on household finances.”

According to the survey, single parents fare the worst as a quarter were in "serious financial difficulties".