In doing the research for this report, we were interested in finding out whether single parents were lacking key financial products, and what patterns there were in their attitudes towards money and their ‘financial capability’. We also wanted to know what their priorities were for Government action to improve their financial situation, and how they thought banks and building societies could help.  The report presents the full analysis but here’s some of the highlights.

Unsurprisingly, we found that overall incomes for single parents were much lower than for couple families, but it was clear that single parents who work are still at a financial disadvantage compared to their counterparts in couple families. Single parents earn less per hour than mothers in couples, let alone couple dads who work, and single parents are also likely to work part-time. Both of these factors contribute to their lower incomes. While work is a good route out of poverty for many, it’s nowhere near a guarantee; nearly a third of part-time single parents are below the poverty line, and 22% of single parents who work full time don’t earn enough to lift their families out of poverty.

Staying with child poverty, the report also contains some new data that’s very relevant to the current hot topic around tax breaks for married families. Analysis from the IFS shows that the money that could be spent on a transferable personal allowance for married couples with young children would lift far more children out of poverty if it was spent on increasing working tax credits for couples, and the same sum would be even more effective at tackling child poverty if used to increase child tax credits for all families, whether married, cohabiting, or single parent. Interestingly, when we asked single parents who had been married whether paying less tax as a couple would have helped them stay together, 89% said it would have made no difference.

When we looked at family spending, it was interesting to see that the family budget is split up in more or less the same way regardless of family type. However, because single parents have much less money to start with, this means that their spending on key areas such as health and education is lower than couple families. We were also very interested to see that single parents’ spending on alcohol and tobacco was very low – single parents out of work spend less than the price of a pint each week on these things (median spend was £2.32) and working single parents don’t spend much more (£3.50). These are useful figures to counteract the cliché that benefit claimants spend all their money on ‘fags’n’booze’.

Looking at parents’ attitudes to money and financial capability, we found evidence that single parents who aren’t working are slightly less careful and overall they scored slightly lower on a test of financial literacy. However, the data shows that the large majority of single parents, whether they work or not, are very careful and sensible with their money, and in fact these non-working lone parents are the most likely to know exactly how much money they have in their bank accounts.

When parents were asked what would help, popular choices for Government action included allowing longer periods for repaying any tax credit or benefit overpayments, increasing the value of help with childcare costs, more funding for independent advice, and more investment to chase child maintenance debt. In terms of what financial services providers could do to help, popular choices centred around help managing cash-flow, including small amounts of credit such as a low interest overdraft or a free buffer zone on current accounts, and also faster cheque processing. Two in five also said they would like more help with budgeting and managing money from their banks.

Gingerbread also recommends that more attention should be paid to increasing job opportunities for single parents, along with access to high quality training so that they can access the jobs that pay well. And while there’s a lot to be said for paid work as a route out of poverty, it’s not a guarantee and in-work poverty has to be tackled. We also think it’s important that policy remembers that there will always be many families that can’t move into work immediately – perhaps because there are young children or illness or disability – and we need poverty solutions for these families as well.

The parents affected from today are the second wave to be moved off Income Support. Over the last year, about 100,000 single parents whose youngest child was between 12 and 15 were moved onto JSA. Gingerbread has just published qualitative research with some of these parents which has produced some useful insights into parents’ experiences of the JSA regime.

We found that many parents felt pressured and stigmatised by the JSA regime, and that fortnightly payments of benefits were causing difficulties for many families (JSA is paid every two weeks whereas IS payments are weekly). It was clear that many parents were not getting clear and timely information – for example, before the change many were unsure when exactly their benefits would switch, and some did not realised that once on JSA their benefits could be cut if they did not meet the job-search requirements, while others thought that JSA might be time-limited and run out if they did not find work quickly. Many of the families in the research had circumstances which meant that paid work especially difficult to find or retain – some parents had physical or mental health problems, some had children with health or behavioural issues, and some had children who were having problems at school.

When the welfare reforms were introduced, the Government said “[Single parents] will be expected to look for suitable work and, if necessary, acquire the skills they need to do so, in return for personalised help and support.” The experience of ‘personalised help and support’ varied greatly for the parents in our study. While some were pleased with the support they’d had once on JSA (often through the New Deal for Lone Parents programme), others said that they had not seen a Lone Parent Adviser, had not discussed training or their particular circumstances, and had had little support other than hurried fortnightly sign-ons. It may be that these parents are offered more support once they have been on JSA longer than a few months, and of course Jobcentres are stretched at present because of high unemployment. But many parents told us that they need more time and input from advisors who understand the difficulties around lone parents’ lives. Without support, trying to find work in a very competitive market can quickly become demoralising and depressing, especially in a recession. Pressure alone will not help resolve the diverse issues that make it difficult for many lone parents to work.

At Gingerbread, the largest charity for single parents in England and Wales, we are calling for:

• Earlier support for single parents, so that intensive personalised support, rather than pressure, is available from the first day of the claim.
• Clear information at all stages of the process so that parents know well ahead of time when they will move to JSA, what this will entail, their rights to support and how their treatment will change over time.
• Recognition that single parents form a distinct ‘client group’ by virtue of their sole responsibility for children. Access to ‘lone parent expertise’ is essential and claims should have a clear lone parent marker on the Jobcentre computer records.
• A clear commitment from Jobcentre Plus to allow parents to undertake training or studying so that they can move into sustainable employment
• The individual circumstances and needs of parents and children must be considered by advisers. There should be more ‘childcare’ for teenagers which is tailored to their interests, to resolve some of parents’ concerns about leaving young people unsupervised.

We were very pleased to hear recent Government announcements that mean that lone parents with a child aged under 12 will be able to limit their availability to term-time and school hours, and related to this, the establishment of a new task-force to look at ways to boost the number of jobs offered part-time.

We were also pleased to hear that lone parents moving onto JSA will now be guaranteed a meeting with an NDLP adviser within the first two weeks of their claim, and we hope that this will mean early personalised support for the next parents to move onto JSA.