Support 100 years of independent journalism.

  1. Chart of the Day
4 July 2022

How the value of child benefit has plummeted

The welfare payment is now worth less than it was in 1999.

By Katharine Swindells

Child benefit has been falling in real terms since 2010, and is now worth less than it was in 1999 even as the cost of living continues to surge. 

The government today announced a consultation into reducing staff-to-child ratios in nurseries, as a way of lowering the cost of childcare. This move has been widely criticised by industry experts as only reducing the quality and safety of care, not the cost.

Childcare is an enormous expense for young families, rivalling rent and mortgages: net childcare costs absorb 29 per cent of the average couple’s wages. Since 2011, the average price of 25 hours of nursery for an under two-year-old in Britain has risen by 44.5 per cent. Over the same period, child benefit rates have increased by just 7.4 per cent.

In April 2022, the current weekly rates of child benefit were increased to £21.80 for the first/eldest child, and £14.45 for each subsequent child. When the Conservatives took office in 2010, these rates were £20.30 and £13.40 respectively. Once adjusted for inflation, the cash-terms increase of £1.50 equates to a fall of 20 per cent.

In 1999, families received £14.40 a week for their eldest child, which is almost £24 in today’s money.

Sign up for The New Statesman’s newsletters Tick the boxes of the newsletters you would like to receive. Quick and essential guide to domestic and global politics from the New Statesman's politics team. A weekly newsletter helping you fit together the pieces of the global economic slowdown. The New Statesman’s global affairs newsletter, every Monday and Friday. The best of the New Statesman, delivered to your inbox every weekday morning. The New Statesman’s weekly environment email on the politics, business and culture of the climate and nature crises - in your inbox every Thursday. Our weekly culture newsletter – from books and art to pop culture and memes – sent every Friday. A weekly round-up of some of the best articles featured in the most recent issue of the New Statesman, sent each Saturday. A newsletter showcasing the finest writing from the ideas section and the NS archive, covering political ideas, philosophy, criticism and intellectual history - sent every Wednesday. Sign up to receive information regarding NS events, subscription offers & product updates.

[See also: The cost of flying in the UK has fallen while train prices have risen]

Content from our partners
How to create a responsible form of “buy now, pay later”
“Unions are helping improve conditions for drivers like me”
Transport is the core of levelling up
Topics in this article: , ,