21/08/2003

Children in poverty need extra £5 per week, says charity

The government will "almost certainly" miss its first target for reducing child poverty unless tax credits for children are increased from next April, the Child Poverty Action Group (CPAG) claimed today.

Launching its campaign, 'Make it a fiver Gordon!', the CPAG is calling on the Chancellor Gordon Brown to give an extra £5 a week for each child living in low-income families from next April.

The government has set itself a target to reduce the number of children living in poverty by a quarter (from 1999's figure of 4.2 million children) by the end of 2004/05. There will need to be fewer than 3.1 million children in poverty in 2004/05 to meet the target. Children are defined as being in poverty if the household income is below 60% of median incomes, after allowing for expenditure on housing costs.

Forecasts by the Institute for Fiscal Studies suggest that an increase of between £3 and £5 a week in the new child tax credit (above planned uprating in line with average earnings) may be needed to ensure the target is met, the CPAG say.

In its Green Budget 2003, published in January 2003, the IFS estimated that the increase of £5 a week in the per-child element of the child tax credit would cost around £1.7 billion a year.

Martin Barnes, Director of the Child Poverty Action Group, said: "The Chancellor said in the budget that he wanted to make faster progress in tackling child poverty, but without a significant increase in the child tax credit the first milestone target for reducing child poverty will almost certainly be missed.

"Significant increases in financial support for children have been made but more needs to be done if the ambitious targets to lift children out of poverty are to be achieved."

(gmcg)

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