Benefits and Financial Support For Families
Despite a fall in the rate of inflation announced in November, the overall price level in the UK was still more than 16 per cent higher last month than in October 2021, according to the ONS.
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The fall in inflation may be very good news for a lot of people coping with the rising cost of their shopping and household bills, but it may cause another problem. That's because theTreasury is rumoured to be considering using October’s CPI increase of 4.6% as the benchmark to raise working age benefits in April 2024, rather than September’s higher inflation reading of 6.7%, which could cut £2bn off the UK’s benefits bill, according to Bloomberg, enabling the Chancellor to fund future tax cuts. Charities have urged the Chancellor not to downgrade the benefits due to poorer households.
Regardless of what happens to benefits, the already madly complicated system often means people don't claim the benefits to which they are entitled. According to the government's own figures:
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40% of people don't claim the Pension Credit they were due
20% of pensioners don’t claim their housing benefit
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Some families could be forgoing as much as £4,000 a year.
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There is separate research which claims that UK households are collectively missing out on at least £19bn a year in unclaimed welfare benefits, at a time when many are forced to use food banks or run up debt as they struggle with rising living costs.
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Lower-income households are failing to claim benefits and other cash support for which they are eligible, according to a study by the consultancy Policy in Practice.
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Single Parents
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1 in 4 households are headed by a single parent (Source: Gingerbread).
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There were just under 3 million lone-parent families in the UK in 2022. This is 15% of all families (Source: ONS).
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Nearly half of children from single-parent households live in relative poverty (Source: Gingerbread).
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During the pandemic, single-parent earnings fell by more than double in households with two parents in the UK with 58% of single parents reliant on Universal Credit (Source: Single Parents RightsCampaign).
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Many parents need a bit of extra help when they have a child, but single-parent households are among the most exposed to the cost of living crisis. One report in 2022 claimed they had a savings pot 20 times smaller than the UK average.
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According to the Single Parent Rights Campaign, during the pandemic, single-parent earnings fell by more than double that of households with two parents in the UK, with 58 per cent of single parents reliant on Universal Credit.
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According to a survey of 6,000 people by Standard Life this month (Nov 2023):
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30% of parents with children under the age of 18 find their financial situation difficult, compared to 22% of people without children
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Over two-thirds (69%) of parents with children under the age of 18 worry that they’re not saving enough now for when they’re older
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65% of parents with under 18's worry about spending too much now in case they run out of money in the future
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Gingerbread is an organisation that provides advice and information to support all single parents and says it offers "the tools to support their children and themselves. And we provide a support network so that, with Gingerbread, no single parent is ever alone." For more information click HERE
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According to the charity Coram's Childcare Survey 2023 "only half of local areas reporting sufficient childcare for children under two, a decrease of 7% on 2022, and under half (48%) reporting enough childcare for parents working full-time, a decrease of 11% on last year."
The Rising Cost of Childcare
£199.01
INNER LONDON: THE HIGHEST PRICE FOR 25 HOURS OF NURSERY CHILDCARE FOR UNDER TWOS
£129.32
YORKSHIRE AND HUMBERSIDE: THE LOWEST PRICE FOR 25 HOURS OF NURSERY CHILDCARE FOR UNDER TWOS
71%
CHILDMINDER COSTS FOR 25 HOURS, FOR UNDER TWOS ARE 71 PER CENT HIGHERIN INNER LONDON
THAN IN THE EAST MIDLANDS
(THE LOWEST COST AREA)
It's Not All About The Money
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Getting the benefits to which are entitled is clearly crucial. But there are many people who are still struggling financially and don't qualify for benefits and for many, probably most, just trying to navigate your way around the benefits systems, can be annoying, frustrating, confusing and upsetting.
It's not clear where to go for help as each benefit has a different procedure and there is no single place you can go to get a helping hand.
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Often it is the emotional support and knowing someone is in your corner that can be as important as any financial help.
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Speaking to people in the sector, they advise trying to visit food banks which often have links to benefit advisers, and other helpful support such as uniform banks - which can help provide free school uniforms. The Citizen's Advice Bureau is a great free resource. You can find your local branch and online advice HERE
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Churches, Synagogues, Mosques, The Salvation Army and other similar organisations can also offer support and guidance and often have outreach workers and you usually don't have to be religious or observant to access the services. A social worker can also put you in touch with organisations and people who can help guide you and your family.
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A Guide To The Financial Benefits Which May Help You
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Money is often crucial and so here is a brief guide to the kinds of financial help that may be available to you:
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Healthy Start Card
If you’re more than 10 weeks pregnant or have a child under 4, you may be entitled to get help to buy 'healthy' food and milk. The money is loaded onto a Healthy Start Card that you can use in some UK shops. The money gets added to the card every 4 weeks.
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It operates like a debit card and can be used where they accept Mastercard. However, there are restrictions on its use. Even if some places take Mastercard, such as a fast food restaurant - the card is blocked so it can't be used.
The idea is that the money should be spent on what are deemed to be 'healthy' purchases.
You'll get money added onto your card every 4weeks. You'll get £4.25 each week of your pregnancy from the 10th week, £8.50 each week for children from birth to 1 year old and £4.25 each week for children between 1 and 4 years old. Your money will stop when your child is 4 years old, or if you do not get benefits that make you eligible. You can also get free vitamins with your card
More details about how to use the card can be found HERE
You can use your card to buy:
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Plain liquid cow’s milk
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Fresh, frozen, and tinned fruit and vegetables
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Fresh, dried, and tinned pulses
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Infant formula milk based on cow’s milk
You can also use your card to collect:
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Healthy Start vitamins – these support you during pregnancy and breastfeeding
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vitamin drops for babies and young children – these are suitable from birth to 4 years old
Information: If you live in Scotland
You can get help from Best Start Foods instead.
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Eligibility Criteria
If only there was an easy rule about who and who cannot get the Healthy Start Card - but as with all things benefits-related - they don't make it easy. Here however are the rules of thumb:
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If you get Universal Credit - Read this:
You can apply online if:
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you’re more than 10 weeks pregnant or have at least one child under 4 years old
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your family’s monthly ‘take-home pay’ (also called ‘earned income’) is £408 or less from employment
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If you get Child Tax Credit - Read this:
If you get Child Tax Credit, you may be eligible for Healthy Start if:
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your family’s annual income is £16,190 or less
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you do not get Working Tax Credit
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There are very weird rules about who can apply online, on the phone or by post - I've no idea why some people are allowed to apply online and others have to rely on carrier pigeon or the regular mail - but the rules about how to apply can be found HERE
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The rules in Scotland are different and can be seen HERE
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Healthy Start cards are only getting around a 50-65% takeup according to The Food Foundation. Families could therefore be missing out on an estimated £68 million in free food, according to Veg Cities.
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Sure Start Maternity Grant
You could get a one-off payment of £500 (£606 in Scotland) to help towards the costs of having a child. This is known as a Sure Start Maternity Grant.
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If you live in Scotland you you can apply for a Pregnancy and Baby Payment instead. Click HERE for details.
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You usually qualify for the grant if both of the following apply:
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you’re expecting your first child, or you’re expecting a multiple birth (such as twins) and have children already
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you or your partner already get certain benefits
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You must claim the grant within 11 weeks of the baby’s due date or within 6 months after the baby’s birth.
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This is a grant, which means it sits outside the benefits and tax credit system and you won't have to pay the grant back and it won't affect your other benefits or tax credits. So good news all round.
Free Nursery Places
Childcare in the UK is often reported to be among the most expensive in the world and the government has been under pressure to provide more help for parents.
In the 2023 budget, it was announced that free childcare for working parents in England will be expanded to cover all children under five by September 2025.
However as there might be an election before that date, things might change.
At the moment all three and four-year-olds are entitled to some free childcare throughout the UK.
Different schemes operate in England, Scotland, Wales and Northern Ireland. It must be delivered by officially-registered providers.
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In England, all three and four-year-olds are entitled to 15 hours of free childcare per week in term time, or 38 weeks a year. Free hours can be used in some private nurseries or state-run pre-schools.
Children of eligible working parents are entitled to 30 free hours per week. Both parents must earn at least £152 per week on average to qualify.
At the moment two-year-olds in England can also have 15 hours of free childcare under certain circumstances, for example if the family receives universal credit.
The free hours are available from the start of the term after the child reaches the relevant age.
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Not all private nurseries offer free hours, and some charge parents for extras on top, such as nappies or snacks.
Click here for source.
Tax-Free Child Care Payments
The title may be a little misleading - that's because while the government does give you money, it is as a top-up to money you have put into your Child Care Account. Nonetheless, it can help with a significant bit of extra cash.
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You can use it to pay for approved childcare, for example:
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childminders, nurseries and nannies
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after-school clubs and play schemes
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Your childcare provider must be signed up to the scheme before you can pay them and benefit from Tax-Free Childcare.
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However I have heard plenty of stories of people not being able to find a childcare place - so the money is one thing - finding a suitable place is another. I'd look early to find a place you think is good and convenient.
Child Care Grant
This seemed largely designed to help if you are a student and a parent.
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You may be eligible for help with your childcare costs if you:
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are a full-time higher education student
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have children under 15, or under 17 if they have special educational needs
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The grant:
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does not have to be paid back
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is paid on top of your other student finance
Child Benefit
You get Child Benefit if you’re responsible for bringing up a child who is:
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under 16
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under 20 if they stay in approved education or training
Only one person can get Child Benefit for a child.
There’s no limit to how many children you can claim for.
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By claiming Child Benefit, you can get:
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an allowance paid to you for each child - you’ll usually get it every 4 weeks
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National Insurance credits which count towards your State Pension
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a National Insurance number for your child without them having to apply for one - they’ll usually get the number shortly before they turn 16 years old
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It’s usually paid every 4 weeks.
If you're eligible you'll get £24 a week for your first child and £15.90 a week for any children after that.
You can claim Child Benefit if:
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you're 'responsible for the child'
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the child is under 16 years old - or under 20 years old and still in education or training
It is not means tested and does not depend on whether or not you are in work.
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Even if you choose not to get Child Benefit payments, you should still make a claim to get the other advantages.
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If you start to earn £50,000 or more, you'll have to start paying your child benefit back. You’ll need to pay back 1% of your family’s Child Benefit for every £100 of your income over £50,000. The 50,000 is your adjusted net income; the pay you're taxed on and doesn't include things you pay for through salary sacrifice. Once you breach a £60,000 annual salary, you have to pay the full amount back in extra Income Tax. It'll also stop if your child starts work for 24 hours or more a week, is no longer in approved education, training, starts an apprenticeship or starts receiving certain benefits in their own right.
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Parents' Learning Allowance
You may be eligible for help with your learning costs if you’re a full-time student with children.
This is called Parents’ Learning Allowance.
How much you get depends on your household income.
The allowance:
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does not have to be paid back
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is paid on top of your other student finance
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will not affect your benefits or tax credit
Working Tax Credit
You may have heard of people talking about Working Tax Credit and they do still exist but are being replaced by Universal Credit - which is a well-meaning attempt by the government to replace the incredibly complex range of benefits with lots of different names, under one name only. However, for the moment, some people are still on or should claim Working Tax Credits rather than Universal Credit. The Department for Work and Pensions (DWP) plans to move all existing tax credit claimants onto Universal Credit by the end of 2024.
You can only claim for working tax credit if you:
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Already received Child Tax Credit
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Have claimed Working Tax Credit in the past year.
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If you work a certain number of hours a week, and have an income below a certain level, you could get up to £2,280 working tax credit in 2023/24.
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There are extra entitlements that you might also be able to claim, depending on your circumstances.
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More details about the scheme and how to apply can be found HERE
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Council Tax Benefits
Apply to your local council for Council Tax Reduction which is sometimes called Council Tax Support. here’s a different scheme in Northern Ireland.
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You could be eligible if you’re on a low income or claim benefits. Your bill could be reduced by up to 100%.
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If you are the only adult in your home you can get a 25% discount on the council tax, regardless of how much you earn,
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You can apply if you own your home, rent, are unemployed or working.
What you get depends on:
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where you live - each council runs its own scheme
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your circumstances (for example income, number of children, benefits, residency status)
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your household income - this includes savings, pensions and your partner’s income
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if your children live with you
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if other adults live with you
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More details HERE
You can get extra help through a Discretionary Housing Payment if you get CouncilTax benefits. This is a top-up payment from your local council. You don't have an automatic right to this payment so have to ask your local council for it and it's up to them to decide whether or not you get it.
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2.7 million people are missing out on £2.8 billion of support from Council Tax benefits, according to the Money Advice Liaison Group
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