Photo credit: Katie Brand for Fife Gingerbread (#bairnscomefirst)
Child poverty is finally getting attention from the Scottish Government, but what do people think of when they hear the word ‘poverty’ in a Scottish context? I would hazard a guess that they’ll imagine a lone parent or couple who are unemployed, and in most instances this will be the case. However, there are many families with parents who are employed but experience in-work poverty.
Even working full time on the National Living Wage, families are falling short when it comes to being able to afford to raise a child, by 12% for a couple with two children and 18% for a lone parent with one child. When you consider it costs on average (according to Centre for Economics and Business Research, 2016) £231,000 to raise a child to the age of 21 in the UK, that 12% – 18% shortfall is a serious amount of money.
Something that isn’t really coming up in the child poverty conversation is something that would help alleviate that shortfall for lone parents; child maintenance. Relationship breakdown and separation have both emotional and financial implications, often resulting in reduced household income, changes to housing circumstances, and employment. Women are more likely to take on caring responsibilities for children and are more likely than men to experience a reduction in income as a result of relationship breakdown. Child maintenance has a vital contribution to make to households, particularly for costs that may be less visible such as childcare to help a parent maintain employment.
In Scandinavia, payments are guaranteed through the welfare system, while in the UK child maintenance is treated as a private matter, with families encouraged to reach a family-based arrangement with or without statutory support. Arrears owing to children from non-resident parents under the previous Child Support Agency stand at over £257million for Scotland (as at September 2016): an average of £4.3million per UK Parliamentary Constituency in Scotland. According to a recent consultation, it is likely that much of this debt will be written off, with a generation of children never seeing the money that should have been there to help meet a child’s everyday living costs.
While the old system was inefficient – costing 50p to administer for every £1 collected – the new Child Maintenance Service is not without its own problems. There is now a £20 fee to access the Child Maintenance Service, payable by the parent with care, disproportionately affecting women. If using the CMS’ Collect and Pay system, there are charges for the parent without care (20%) and deductions from what is paid to the parent with care (4%), which reduces the amount of child maintenance that a family receives while generating substantial annual revenue income for HM Treasury.
The reality is that two thirds of lone parents receive no child maintenance payments. Many families are facing hardship as a result of non-payments, with low income families being particularly affected by non-payment of child maintenance. Even where there are arrangements in place, levels of child maintenance are not viewed as adequate for a child’s needs.
Shielding children from issues arising from child maintenance arrangements can be difficult. Child maintenance can be used as a form of coercive control, and a way to have a continuing hold over a former partner and child. Irregular payments and inconsistency in the amount paid can make it difficult to budget for child and household needs effectively, creating financial hardship and stress. In cases where there is a successful child maintenance arrangement in place, parents often redistribute money across the household in order to meet the needs of all the children which can create tension within the household and affect children’s emotional wellbeing.
Imagine the difference that a basic income would make for children and families. As well as being universal and unconditional, a basic income would be paid to individuals, including children. The primary care giving parent would administer a child’s basic income on their behalf. This would provide a regular and reliable payment that households could use to provide for their children and to plan for their future, radically changing the context for conversations around child poverty, the value of caring, and making work pay.
Rhona Cunningham, Fife Gingerbread
Drawing on Poverty Alliance Research into Child Maintenance in Fife
 95% of parents with care are female