Photo: ThinkstockBy David Hounsell
The government has just announced key details about how its flagship welfare reform programme, universal credit, will operate. These changes represent the largest shake-up of the welfare system in a generation. And they will have major knock-on effects.
One will be a change about which children are eligible to receive a free school meal. Under the current system, they can get a free school meal if their parents are not in work, work few hours or their family is on a very low income. Under this system, eligibility is distributed to families in receipt of certain benefits – for example job seekers allowance. After the introduction of universal credit, these benefits will no longer exist.
Now is a critical decision point for the government. They not only need to decide who should receive free school meals, but how it will work with the universal credit. Our Fair and Square campaign calls for a solution to this thorny issue.
The Children's Society is calling on the government to extend free school meals to all children in families in receipt of the universal credit. Not only would this make sure that the new system makes work pay for families. Crucially, it would also make sure that every child living in poverty is entitled to a free school meal.
Free school meals matter for family incomes, and therefore for child poverty. They are worth more than £1,000 a year to families with three school-age children. At the moment, over a million children living in poverty are not entitled to them. That is because 60% of children living in poverty actually live in working households - the same families who currently are not eligible for free school meals.
The Children's Society's own analysis shows that extending free school meals to all children living in families in receipt of universal credit would directly lift 100,000 children out of poverty. As the majority of these families are in-work, this would double the progress made on in-work child poverty over the past decade. It would also help narrow the poverty gap for hundreds of thousands more children and their families.
Of course investment is required to make this happen. But what our analysis clearly demonstrates is that these policy options are relatively cost-effective in helping the government towards its target to end child poverty by 2020.
It would also help make sure that work always pays. The government has discussed introducing an income threshold beyond which free school meals would be removed. This 'cliff edge' would result in a situation where many families are actually better off working fewer hours or earning less. The impact of this is not trivial. An income threshold of £7,500 a year would leave around 120,000 families trapped in this situation leading to greater pressure on the exchequer.
This is a key moment for the future of welfare reform. The government has a great opportunity to make sure that universal credit does make work pay for families whilst giving every child in poverty access to a free meal at school. By extending entitlement they would make a lasting and direct impact on the lives of children and families up and down the country.
David Hounsell is economic advisor to the Children's Society