One in five parents in dire financial straits as charity warns UK in ‘cost-of-children crisis’

Wednesday 18 October 2023
Sad daughter being comforted by her dad

New Action for Children analysis shows that by almost every financial measure families with children are among the hardest hit by the cost-of-living crisis.

Action for Children today warns the UK is in the midst of ‘a cost-of-children crisis’, as its new analysis reveals that by almost every financial measure families with children have been among the hardest hit by the country’s high inflation.

The charity’s analysis of data from the abrdn Financial Fairness Trust’s survey of more than 5,000 UK households shows that in May this year, one in five homes with children (19%/1.5m) were classed as being in ‘serious financial difficulty’ – the most severe form of financial insecurity. This was six percentage points higher than those without children (13%).

Action for Children found that compared to households without children, families with children were:

  • Six times more likely to have had a pay-as-you-go energy meter installed and to have turned to informal lenders or loan sharks (6% vs 1% / affecting an estimated 475,000 families) in the six months between November 2022 and May 2023;
  • Three times more likely to be behind on household bills (29% vs 9% / affecting c2.1 million families) or debt repayments (25% vs 7%); and
  • Twice as likely to be behind on rent or mortgage payments (10% vs 4%), or to have gone without food when hungry (15% vs 8% affecting c1.2m families) or missed multiple meals (9% vs 5%) in the preceding month.

Single parents fared the worst, with a quarter being in ‘serious financial difficulties’ (26%) - higher than any other family type.

Action for Children is calling on the government to protect low-income families by increasing social security levels in line with inflation at the Autumn Statement and to reform future Cost of Living Payments to take family size into account. The charity also wants to see family incomes boosted further through an increase to the child element of Universal Credit and a scrapping of the Benefit Cap, both of which would lift more than 300,000 children out of poverty.

Paul Carberry, chief executive at Action for Children, said: ‘Our stark findings show the UK is in the midst of a cost-of-children crisis, where a parent penalty premium makes every day a battle for low-income families just to stay afloat.

‘With more mouths to feed, clothes to wash, rooms to heat and typically fewer savings, families with children are especially vulnerable to financial shocks, and that pressure is being felt most by those on low-incomes, and single parents in particular.

‘The cost-of-living crisis is far from over as prices across the economy are still rising with food inflation remaining particularly high at almost 14%. The Bank of England does not expect to reach its 2% inflation target until early 2025, and energy prices remain volatile and stubbornly high as winter draws near.

‘Every day, our frontline workers are applying to our Crisis Fund for emergency grants to support low-income families in their care with basics like food, clothing, and utility costs. The Chancellor must act at the Autumn Statement to protect families with children from these intense and ongoing pressures on household finances. At the very least, we must see benefits rise with inflation and Cost of Living Payments reformed to take family size into account.’

Charlene, 36, from Devon has a six-year-old daughter and is a single mum who relies on Universal Credit as she is medically unable to work due to mental health issues and COPD.

‘I can’t work because of health issues, so I rely on Universal Credit. The money I get doesn’t go far enough. I’ve cut back on absolutely everything, but I’ve still had times when I’ve looked in the cupboards and they’re empty. I skip meals several times a week and often just eat cereal for a main meal as that’s all I have left from the food parcel.

‘I know she gets a hot lunch at school every day, so I don’t feel so bad not having hot food in the evening at home. But making her a hot meal every day during the school holidays is a big worry.

‘Keeping up with my gas bill has also become a huge problem. I have a chronic lung condition called COPD, and my daughter has asthma, so I have to keep the house warm in the winter. It makes me feel awful that I can’t provide basic things for her. It’s just degrading as a parent. When you’re hungry and worrying about feeding your child, you can’t focus on anything else.

‘Action for Children has helped me with things like food parcels, loans to pay for school uniform and advice on budgeting and bills. I don’t know what I’d have done without the staff at the children’s centre. They’re always there to talk to, and I never feel judged.’



Huw Beale, Media Manager, Action for Children – 07718 114 038 / [email protected]

Out of hours – 07802 806 679 / [email protected]


1 The University of Bristol segmented survey participants into four categories, based on the extent to which they could meet their financial obligations and the resources they had to meet an economic shock. ‘Serious financial difficulties’ is the most severe category and refers to those households with a score of less than 30 out of 100.

2 abrdn Financial Fairness Trust (2023) ‘Financial Impact Tracker’. June 2023. The Financial Fairness Tracker, commissioned by the abrdn Financial Fairness Trust and analysed by a team at the University of Bristol, has been monitoring the personal finances of households since the start of the pandemic via data collected from YouGov’s panel. This briefing reports findings from secondary analysis of Tracker data undertaken by Action for Children. The survey sample was 5,700 households in total, of which around 1,400 were households with children. We extrapolated the survey data to UK-wide totals, using the latest ONS estimate of 7.9m households with dependent children in the UK.

About Action for Children

Action for Children protects and supports vulnerable children and young people by providing practical and emotional care and support, ensuring their voices are heard and campaigning to bring lasting improvements to their lives. With 426 services across the UK, in schools and online, in 2022/23 we helped 765,905 children, young people and families.