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Living wage failing to cover basic needs of families, charity warns

1:41 pm, 20th August 2018

A single parent working full-time on the national living wage is falling £74 a week short of what they need to achieve a basic standard of living, according to a report by the Child Poverty Action Group (CPAG).

Couples raising two children while working full-time on the minimum wage are falling £49 a week short, the charity said.

However, this was an improvement on last year when couples were £59 a week short.

CPAG blames rising prices, benefits and tax credit freezes, the bedroom tax and the roll-out of universal credit for hitting “family budgets hard” and called for an increase in the so-called national living wage.

Chief executive Alison Garnham said: “There is strong public support for government topping up the wages of low-paid parents and investing in children is the best long-term investment we can make.

“By using the forthcoming budget to unfreeze benefits and restore work allowances, the government can take steps towards making work really pay.”

The national living wage is £7.83 an hour for those aged over 25.

The overall cost of a child, including rent and childcare, fell from £155,100 to £150,800 for a couple and from £187,100 to £183,300 for a lone parent.

This is due to the the new 30-hour subsidy for childcare for three and four-year-olds, CPAG said, but the charity noted it is not available for many families, including those working part-time.

Gains from increased minimum wages were offset by a freeze in tax credit support, the report said.

A government spokeswoman said fewer are living in absolute poverty today and ministers are committed to giving every child the best chance.

“The employment rate is at a near-record high and the national living wage has delivered the highest pay increase for the lowest paid in 20 years, worth £2,000 extra per year for a full-time worker,” she added.