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Single parents bear the brunt of Covid debt as living standards slide

·4-min read
More than 375,000 single parents are struggling to pay back problem debt, according to research (Getty)
More than 375,000 single parents are struggling to pay back problem debt, according to research (Getty)

Single parent households are facing disproportionate Covid debt as new data reveals they are three times more likely to have fallen into the red than adult-only households.

Data seen exclusively by The Independent suggests households with one parent saw average debts rise by a staggering 44 per cent of their total monthly income during national lockdowns.

The figures, produced by the Centre for Economics and Business Research and comparethemarket.com, suggest that more than 375,000 single parents across the country are now struggling to pay back problem debt.

With Boris Johnson this week refusing to rule out further restrictions next winter, two in every five single parents have worried about how to make ends meet during previous lockdowns.

According to Bank of England data, outstanding consumer credit fell significantly over 2020 but the research shows that this decline was mainly driven by childless households. Single parents are significantly less likely to have been able to save money in the past year than the rest of the population.

These latest statistics echo earlier warnings that 82 per cent of single parents don’t have enough income to meet their living costs.

Figures released by debt charity StepChange and Gingerbread, the charity for single-parent families, during the last national lockdown show those in full-time work were more likely to be in problem debt with increased childcare costs fuelling the risk of persistent debt and enduring poverty.

“Before the pandemic, around 70 per cent of single parents were in work but this didn’t protect them or their children from poverty,” said Victoria Benson, chief executive of Gingerbread, at the time.

“It’s shocking that in 2021 so many are forced to go hungry in order to repay debts built up as their income doesn’t even cover basic living costs.”

In order to make their debt repayments, 66 per cent of single parents have gone without food and 20 per cent have been forced to cut back on food for their children.

Half have fallen behind on rent or mortgage payments because they have made debt repayments instead and almost one in five single parents have had to use a food banks due to repayment demands.

The government responded to calls to maintain the emergency increase in Universal Credit by announcing at the last Budget that it would extend the uplift of £20 a week until the end of September. The suspension of the Universal Credit minimum income limit was also extended until August.

But even taking those add-ons into account, new forecasts show that by the end of the year a third of the UK population – more than 21 million people – will be living below a Minimum Income Standard (MIS), the calculated cost for an individual to be able to thrive in the society they live in.

That includes more than two-thirds of single parents and almost half of all the UK’s children.

Families living below the poverty line were typically short by £5,670 a year according to economic modelling by the New Economics Foundation (NEF), a social and economic justice think tank whose data is regularly cited by government.

Its latest report highlighted that the effects of the Covid-19 pandemic followed a decade of stagnant growth in real earnings, rising housing costs for renters, and freezes, cuts and caps to working-age benefits, particularly those received by families with children.

Across the two decades leading up to 2020, the poorest 10 per cent of families saw their income grow by just 3 per cent after housing costs – six times slower than the national average. As a result, nearly 3 in 10 people were already living in households with incomes below the MIS, even before the pandemic began.

But Covid has undoubtedly accelerated the living standards crisis, and even with the extra £20, more people were living below the MIS in April 2021 than when the pandemic started.

Today, NEF figures suggest, a total of 12.5 million people live in families with incomes worth less than 75 per cent of the minimum to thrive, and who “are therefore at particularly high risk of deprivation”.

Using the government’s own poverty measure of households in relative low income, the think tank calculated that almost 15 million people will remain in poverty without significant policy change, even if the £20 a week Universal Credit uplift remained in place long term.

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