Why Having a Baby Pushes Thousands of UK Families into Poverty

18 Mar

For many families, welcoming a new baby is a time of joy and celebration. However, for a significant and growing number of UK households, it is also a time of increased financial strain that can push them below the poverty line.

In fact, having a child is one of the most common triggers for families falling into poverty, especially during the baby’s first year of life. In this blog, we explore the reasons behind this troubling reality and the far-reaching effects it has on parents and children.

The Stark Reality: Poverty in the First Year

According to the Joseph Rowntree Foundation (2023), 1 in 3 children in the UK lives in relative poverty by the time they turn one. That means their household income is less than 60% of the national median, adjusted for household size.

Furthermore, a Resolution Foundation report (2022) revealed that over 100,000 parents fall into poverty during their baby’s first year. The combination of reduced income and rising costs is the key driver behind this.

Why Do Families Fall into Poverty After Having a Baby?

1. Loss of Income

Most parents take time off work during the first year, often relying on Statutory Maternity or Paternity Pay (SMP/SPP), which is currently £187.18 per week (£812 per month). This represents a 60% – 67% drop from the average monthly take-home pay of £2,000 – £2,400 (ONS, 2024).

For single-income households or those with low earnings, this reduction is particularly devastating, leaving families unable to meet essential living costs.

2. High Cost of Essentials

Babies may be small, but their needs are not. Parents spend on average:

£600+ per month on baby essentials, gear, and increased household bills
£1,200 – £1,500 per month if childcare is needed

These costs, on top of rent or mortgage payments, leave little to no room for savings or emergency expenses.

3. Lack of Accessible Support

Government support like Universal Credit, Child Benefit, or Tax-Free Childcare helps some families, but many are ineligible due to household income thresholds or find the support insufficient to bridge the financial gap.

The Impact on Parents and Children

Poverty in the first year of life can have long-term consequences for both parents and children:

Parents:

Mental health struggles: Increased rates of stress, anxiety, and postnatal depression
Debt accumulation: Many turn to credit cards or loans to cover shortfalls
Workforce challenges: Difficulty returning to work due to childcare costs or inflexible jobs

Children:

Developmental delays: Linked to poor housing, nutrition, and parental stress
Long-term disadvantage: Children in poverty are less likely to achieve educational and employment success

Single Parents at Higher Risk

Single-parent households are particularly vulnerable, with nearly 50% of children in single-parent families living in poverty (Joseph Rowntree Foundation, 2023). The reliance on a single income and the inability to share childcare responsibilities contribute to this alarming figure.

Breaking the Cycle: What Needs to Change?

Experts and campaigners argue that reducing child poverty requires:

Improved statutory pay: Raising SMP/SPP to closer match living costs
Affordable childcare: Subsidies and free hours that truly cover working parents' needs
Universal support: Removing means-testing from certain benefits
Targeted help for single parents and low-income families

Until systemic changes are made, many families will continue to face financial hardship during what should be one of the happiest times of their lives.

Final Thoughts

Having a baby should not push families into poverty - yet for thousands across the UK, it does. The combination of reduced income, rising costs, and insufficient support creates a perfect storm that leaves new parents struggling to stay afloat. Addressing this crisis requires more than short-term fixes - it demands a fundamental shift in how we support families in their most vulnerable moments.

Sources:

Joseph Rowntree Foundation (2023)
Resolution Foundation (2022)
Office for National Statistics (2024)
Gov.uk Statutory Pay Rates

Grace Carter