London Daily

Focus on the big picture.
Tuesday, Oct 13, 2026

Universal credit rise lifted 400,000 children out of poverty, data shows

Universal credit rise lifted 400,000 children out of poverty, data shows

Experts say removal of £20-a-week boost and soaring living costs likely to push 1 million below UK breadline
About 400,000 children in the UK were lifted out of poverty during the first year of the pandemic because of the government’s £6bn universal credit boost, official figures have revealed, amid warnings benefit cuts could push more than 1 million people below the breadline.

Statistics published on Thursday showed years of rising relative poverty were reversed after ministers introduced a temporary extra £20-a-week to universal credit in April 2020, together with extra housing support, furlough and other measures in response to the Covid outbreak.

As a result, the incomes of the poorest 20% of households rose by 4% and unemployment stayed low, with campaigners heralding this as proof that investment in social security was an effective way of lifting children out of poverty.

There were 3.9 million children in relative poverty – defined as households receiving below 60% of the median annual income – during the first year of the pandemic, the data revealed, equivalent to 27% of all UK children, and down 400,000 year on year.

Campaigners and experts said the statistics showed this progress was likely to be a one-off as the withdrawal of the extra £20 a week, coupled with the rising costs of food and energy and below-inflation benefit increases, would take their toll on household living standards from April.

Ministers cancelled the £20-a-week boost along with other pandemic support measures in October, arguing – despite widespread opposition – that the government’s focus should shift to getting people into jobs and better paid work as the economy opened up.

The UK has since been gradually engulfed in a growing cost of living crisis, with living standards currently falling at the fastest rate since the 1950s. The energy price cap, council tax and national insurance contributions all rise on Friday, piling pressure on already struggling low-income households.

The Resolution Foundation thinktank estimated 1.3 million people, including 500,000 children, could be pushed into absolute poverty over the coming months as a result of ministers’ decision to increase benefits and the state pension at less than half the 8% inflation rate – equivalent to an £11bn cut in the value of support.

“The lack of targeted support in the recent spring statement means that households’ incomes are set to fall more sharply during the pandemic recovery than they did during the pandemic itself … It is essential that more support is delivered to turn this bleak living standards outlook around,” said the Resolution Foundation principal economist, Adam Corlett.

The Child Poverty Action Group (CPAG) said the figures showed ministers had “the power to protect children from poverty” but their failure to offer serious help in the spring statement last week indicated they had “turned their backs” on families struggling with the cost of living crisis.

“Many of the children who were lifted out of poverty by the £20 increase to universal credit have already been forced back over the brink by the government’s actions. And as millions struggle with spiralling costs, we know the picture will worsen,” the CPAG chief executive, Alison Garnham, said.

Analysis of the figures by the End Child Poverty coalition revealed the highest levels of child poverty at local authority level in 2020-21 were recorded in Middlesbrough, where 42% of children were living below the breadline. At parliamentary constituency level, 51% of all children in Birmingham Hodge Hill were in poverty.

Rishi Sunak’s spring statement included a 5p cut in fuel duty and increased the national insurance threshold but it rejected calls for inflation-matching benefit rises and the chancellor was widely criticised for ignoring the households struggling the most with the cost of living.

Boris Johnson promised an MPs’ committee on Wednesday he would examine a proposal to increase universal credit in line with inflation, after the Conservative MP Mel Stride warned him that claimants would “really suffer” as a result of the below-inflation benefit rise.

The work and pensions secretary, Thérèse Coffey, said in a statement on Thursday the focus would remain on boosting incomes through getting people into work, while a government spokesperson insisted work was “the best and most sustainable route out of poverty”.

The shadow work and pensions secretary, Jonathan Ashworth, said cutting the £20 universal credit uplift had stripped away a vital lifeline. “That choice, combined with soaring energy bills, Tory tax hikes and real-terms cuts to universal credit and the state pension mean hard-pressed families now face the worst fall in living standards ever recorded.”
Newsletter

Related Articles

0:00
0:00
Close
UK Orders Security Review Following Reported Killing of Former Politician Ann Widdecombe
UK Prime Minister Andy Burnham Meets German Chancellor Merz to Strengthen European Security Ties
Nearly 100,000 NHS Patients Treated in Hospital Corridors as England Braces for Winter Pressures
UK Government Rejects US-Russia Diesel Agreement and Reaffirms Sanctions Against Moscow
UK and Germany Agree to Deepen Security and Economic Cooperation Following Berlin Talks
British Prime Minister Burnham Pledges Closer EU Ties During Visit to Germany
UK Announces New Sanctions on 17 Russia-Linked Entities During Foreign Secretary's Ukraine Visit
UK and Germany Finalize Kensington Treaty to Strengthen Defense and Technology Cooperation
Britain Maintains Diplomatic Mission in East Jerusalem Despite Israeli Closure Deadline
English Councils Push Government to Rethink Proposed Funding Cuts
Scottish Homebuilding Falls to Lowest Level in 11 Years
BBC Chief Matt Brittin Defends Restructuring as Staff Challenge Job Cuts
UK Finance Warns High Energy Costs and Bond Yields Are Complicating Fiscal Outlook
UK Adopts All 44 Recommendations on Regulating AI in Healthcare
Chancellor John Healey Prepares Autumn Budget as Borrowing Costs Strain Public Finances
UK Investigators See Strong Indications of Iranian Link After RAF Fairford Security Operation
Laura Trott Pledges Tighter Controls on Political Activism in UK Classrooms
Welsh Ministers Launch Long-Term Review of North Wales and Anglesey Crossings
Welsh Government Orders 18-Month Study of Road Solutions Around Newport
Reform UK MP Sarah Pochin Faces Scrutiny Over £800,000 Second Home Purchase
British Households Grow More Concerned About Fuel and Energy Prices
NHS Leaders Warn of Rising Winter Pressure on Emergency Departments
Kemi Badenoch Proposes £2.3 Billion Employer National Insurance Cut for Young Workers
Middle East Conflict Could Erase UK Fiscal Headroom, Economists Warn
Manchester City Found Guilty of Multiple Premier League Financial Rule Breaches
UK Security Services Find Strong Indications of Iranian Role in RAF Fairford Incident
Costa Coffee Returns to Operating Profit on Iced Drinks and Menu Changes
Asos Warns Customers After Unauthorized Access to Retail App and Data
Kemi Badenoch Puts Growth and Deregulation at Center of Conservative Conference
Campaigners Warn of Deepening Social Care Crisis for Disabled Adults
Study Finds Rising Early-Onset Cancer Rates Among Adults Under 50 in Britain
UK Coach Operators Warn High Diesel Prices Could Force Route Cuts
FCA Opens Independent Review Into Handling of Epstein-Linked Whistleblower Case
Argentina Vows to Block Falkland Islands Offshore Oil Development
UK Chancellor Prepares Fiscal Measures and Welfare Reforms Ahead of Autumn Budget
Sainsbury’s and Morrisons Explore Potential Multi-Billion-Pound Merger
UK Weighs Tariffs on Chinese Electric Vehicles to Align With European Union
UK Threatens Diplomatic Expulsions Over Planned Closure of East Jerusalem Consulate
UK Energy Price Cap Hits Three-Year High as Middle East Conflict Raises Costs
Seventh Arrest Made in Suspected Terror Plot at RAF Fairford
Systemic Education Collapse Sparks Mass Student Uprisings in France
Green Party Faces Backlash Over Resolution Equating Zionism With Racism
Conservatives Debate Scrapping Environmental Rules for New Homes
Cornwall Insight Warns UK Energy Bills Could Approach £2,000 This Winter
UK Coach Operators Warn of Service Cuts as Diesel Prices Exceed £2
Scottish Parliament Approves £68 Billion Budget With New Tax and Property Measures
FCA Opens Independent Review Into Handling of Epstein Whistleblower
UK Government Drops Plan to Suspend Jury Trials in England and Wales
Bank of England Holds Interest Rate at 3.75% as Markets Watch November
Two Iranian Nationals Charged Over Alleged Plot Targeting Manchester Jewish Community
×