Low income working families can qualify, but only if they work under 16 hours per week (24 hours for couples) and earn less than £16,190 per year. This can create a substantial work disincentive since working families can lose the key benefit (worth around £370 per child per year) no matter how little they earn. In fact, of families in receipt of Free School Meals, who The Children’s Society surveyed for our report “Fair and Square: The future of Free School Meals” six out of ten said that the threat of the loss o f Free School Meals has a direct impact on their decisions about moving into work or taking on additional hours.

One working parent told us:

the difference between me working or not is about £40, half of which is now paid out in school meals. It has a huge impact.

It also means that an awful lot of children in poverty – around 700,000 – aren’t entitled to receive free school meals – often simply because their parents are in low paid work.

Following the introduction of Universal Credit from next year the eligibility criteria for FSM will need to be revised, (since many of the key benefits which currently determine entitlement will no longer exist for new claimants.)

This presents a great opportunity to extend free school meals to children in low income working families – to ensure that all children in poverty are entitled to a free school meal, and to get rid of the work disincentive effect. This could be achieved by extending free school meals to all children in families in receipt of Universal Credit.

However, it also presents the serious risk that work disincentives could become still worse than they are at present. Currently the government is considering determining free school meal entitlement under Universal Credit on the basis of an earnings threshold. This could create what is known as a benefit “cliff edge” where families are left considerably worse off as a result of an increase in pay or in working hours.

We estimate that if an earnings threshold of £7500 were used for free school meal entitlement, around 120,000 families (with around 350,000 school children in,) would be caught up in this cliff edge – left in the perverse position where they would be better off taking a pay cut in order to bring them back into entitlement for free school meals – exactly the kind of situation which Universal Credit was supposed to address.

This is why we have launched the “Fair and Square” petition to call on the government to extend free school meals to all children in families entitled to Universal Credit. Please follow this link and show your support.

25 national organisations including the Children’s Society, the TUC, Barnardo’s and Action for Children have come together to call for a change in the Government’s plans for a substantial cut to welfare support for disabled children under the new “Universal Credit”.

The new system will result in many of these children losing up to £1400 per year (£27 per week) compared to the current system – by the time a disabled child reaches 16, this could cost the family £22,000. In total the Government estimates that 100,000 disabled children would lose out under this change – other estimates suggest the number could be considerably higher. We know from our own experience at the Children’s Society, that many of the children with whom we work would have their support cut as a result of this change.

Antony Best, 23, from Bradford, is a full-time father after losing his wife to swine flu last winter. He has three children to look after and two of them also have a disability. Casie, 4, has Down’s syndrome, while her eight-month-old brother, Alfie, has cerebral palsy.

Antony is already relying on family and friends to help him out with caring from time to time and his budget is at breaking point. He receives £197 a month from the tax credit and disability allowance systems.

I can spend more than that just getting the basics for the kids, and that is before I have thought about feeding myself, he said.

Any cut to what we survive on now would have a real impact on our living. So many of the things we need every day, like milk for my youngest and nappies, are already more expensive . . . We just about manage.

Financial support is crucial to help these families with the costs of raising a disabled child and manage their extra caring responsibilities.  £27 is more than half the average family’s food budget – enough to mean the difference between a family meeting their child’s basic needs, and being left simply unable to cope.

The Comprehensive Spending Review announced that £2 billion will be set aside over the next four years for the introduction of the Universal Credit. At a time of strict financial constraints, we believe that the Government cannot justify a commitment to such additional spending, if it fails to support the most vulnerable families with disabled children.

Please help if you can:

• sign the petition now and
• promote it on your Facebook, Linked In and Twitter accounts.

We have a one-off opportunity to make a real and important change for disabled children and young people; together we really can make the Government think again on this.

At present, parents of children with disabilities (in receipt of DLA,) are entitled to a substantial top up of their Child Tax Credit entitlement.  This addition is currently worth up to around £2715 (£52.21 per week) for each child in the household who has a disability.

In addition, children with the most severe disabilities (in receipt of the high rate care component of DLA), are entitled to the severe disability element, worth an additional £1095 (£21.06) – meaning they get a total addition worth up to £73.27 per week.

Under the Universal Credit, families caring for a disabled child will instead be entitled to one of two rates of addition to their Universal Credit entitlement, either the lower or the higher addition.

The most severely disabled children will be entitled to an addition worth £74.50 per week – a very slight increase on current rates paid for severely disabled children through child tax credit.  (In addition, children with severe visual impairment will be brought into this group, and as a result could gain significantly.)

However, for other children with disabilities, the addition will be £25.95 per week (£1349.40 per year) – less than half the maximum value of the disability element of Child Tax Credit.

This change could cost a family with a disabled child up to £1366 per year. The loss for a family over the course of the childhood of a child born with a disability could amount to substantially more than £20000 – or more than £40000 for parents with two disabled children.

(It should be noted that DLA for children will not be affected by this change since this remains outside of the Universal Credit.)

New claimants will receive the reduced support at the point of claiming Universal Credit.  Parents with disabled children who are already in receipt of benefit will receive transitional cash protection on being transferred onto Universal Credit, until the point where this protection is either lost (as a result of a change of circumstances), or is eroded away (since the cash protection is not increased with inflation.)

In our briefing note on this issue Family Action estimates that around 100,000 families with disabled children could lose support as a result of this change.  This includes many of the very poorest families, already struggling to make ends meet whilst caring for a disabled child.

The Government is likely to produce its child poverty strategy some time in the next week or so.  This change is not likely to contribute to a future free from disabled children living in poverty, and the Government really need to think again about how they ensure that families caring for these children receive the level of support they need.

For instance, many of the families we work with are couples who work hard to balance their work and childcare responsibilities, and to stay in work of between 16-23 hours per week.  Changes to eligibility rules for Working Tax Credits could lead to some of these couples losing up to £3,810 per year in Tax Credit entitlement.  Indications suggest that the changes could leave them worse off in than out of work – and potentially push these families into poverty.

For those who are entitled to Working Tax Credit, freezes on the basic and 30 hour elements will effectively reduce the support they receive in work.  Inflation is currently high and could rise further – the higher it climbs, the harder the impact of this freeze will hit working families.

The CSR also reduces help for working families with childcare costs by reducing maximum help with childcare costs through the childcare element of Working Tax Credit.  This could cost working families up to £30 per week – £1,560 per year.  Potential changes to help with childcare costs through the Universal Credit (as discussed in our paper “The Universal Credit: Marginal Returns?“) could risk further reducing help with childcare costs for many families.

In addition, changes to the contributory Employment and Support Allowance could lead to income losses of up to £91.40 per week for couple households where one member is working, and where the other is too ill to work.  The changes could lead to households such as this being pushed into poverty.

Family Action agree with the Government that work should pay, and believe that it should be an assured route out of poverty, but are concerned that many of their reforms to the welfare system go in the opposite direction.  They need to do more to ensure that welfare cuts don’t penalise low income working families in the near future and that, in the longer term, enough investment is made in the Universal Credit to ensure that it further supports all families in moving into, and progressing in, work.

Last week the Chancellor announced that benefit payments would be capped at £26,000 per year (or £500 per week) for out of work households, with only families entitled to Disability Living Allowance, and War Widows Pension exempt. Treasury figures estimate that these caps would affect 50,000 families.  Family Action’s research report “The cap doesn’t fit”, shows that the caps would particularly affect large families and those living in London.  Contrary to Government intentions to promote stable relationships, the caps will also introduce a substantial couple penalty into the benefits system.

For instance, an unemployed couple with five children, paying rent of £200 per week, and council tax of £20 per week are currently entitled to around £628 per week in benefits and tax credits.  This family will lose £128 per week (31`% of their disposable income) when the cap is introduced. But the couple penalty the welfare cap would introduce into the system is stark.  For instance, for our service users above, were the household headed by a Lone Parent they would be entitled to £591 per week, and whilst they will still lose out (by £91 per week, or 25% of their disposable income), they will lose considerably less than the equivalent couple household.

The impact of the benefit cap would be particularly great when two out of work Lone Parents form a couple household. As separate Lone Parents with 2 children each, and rent of £200 each (and council tax of £20), their benefit income would be £418 for each household – safely below the housing benefit cap. As a couple with four children and a rent of £300 per week (and council tax £20) their total income would be around £670 – this would put them £170 over the proposed cap, and they would therefore lose more than nearly £9000 per year compared to now.  This change is so substantial that it would be likely to prevent many Lone parents from entering relationships (particularly with other Lone Parents).

In cases where they decide not to cohabit because of the financial implications, this would also lose the Treasury money, since for each couple like the one above that decides to stay apart so as to avoid the welfare cap, instead of paying out £670 per week to one couple, benefits of £418 per week will be paid to two Lone Parent households - a total additional benefit bill of £166 per week, costing the Treasury an additional £8800 per year if the couple decide to stay apart.

The proposed welfare caps would also have a profound impact on households with one earner who loses their job.

Take for example a couple with 4 children, rent of £300 per week and council tax of £20 per week. One of the parents works 30 hours per week and earns £200. Their current income after housing cost is £444 per week. If they lost their job, through no fault of their own, their household income would currently reduce to £350 per week after housing costs – a loss of £94 per week (21% of their disposable income).

If they lost their job after the introduction of the welfare caps, their income after housing costs would reduce to £180 per week – a loss of £264 (or 60% of their disposable income) compared to their income in work. The introduction of welfare caps would lose this hard working family £170 per week compared to their current out of work income.

Such a substantial loss of income could prove unmanageable for this family. In some circumstances they may end up losing their home as they are no longer able to afford the rent, potentially making it harder for them to re-enter the Labour Market.

Family Action works with vulnerable families in the home, providing early intervention services that strengthen families, assisting them to take more responsibility for their lives, parent their children well, build a stable home, and where appropriate, help them to move into employment. These changes would make this job harder. And it is couples who will be hardest hit as a result of these changes – which doesn’t chime with a Government that champions marriage and stable communities built on stable relationships.

The caps will disincentivise stable couple relationships and force many families, particularly in London to move, creating instability and crisis for many vulnerable families. If Government Ministers really believe it’s their job to make wedding bells ring these measures need a rethink.