Kinship carers at risk of poverty and debt due to welfare cuts

Tens of thousands of kinship carers – adults who volunteer to bring up child relatives when parents are unable to do so – risk severe poverty, debt and losing their home as a result of welfare cuts, experts have warned.

Although kinship carers save the state billions of pounds each year in care costs and make significant personal sacrifices – an estimated two-thirds of kinship carers give up work to look after child relatives – many are threatened by tax credit cuts and the benefit cap.

The charity Family Rights Group (FRG) said government plans to limit child tax credits to two children from 2017 will have a “disastrous impact” on the finances of thousands of kinship carers who look after at least three children, and will deter many potential carers from taking on the role.

Cathy Ashley, chief executive of FRG, said: “The tax credit and welfare reforms are potentially disastrous for kinship carer households and will deter many potential kinship carers from coming forward, resulting in more children ending up in the care system, at significant cost to the public purse.”

She added that kinship carers who have their own children living with them would in some cases be forced by the benefit cap to move home to another area, away from their own children’s school and support network.

Children move into kinship care for a variety of reasons, including neglect or abuse by their birth parents, parental illness, addiction, imprisonment or death. The children’s minister, Edward Timpson, has described kinship carers as “the unsung heroes” of the care world.

Some kinship carers will also be affected by the lowering of the benefit cap from April. This will limit total benefits claimable by unemployed working-age households to £20,000 or £385 a week (£23,000 or £442 in London), plunging many of those affected into food poverty, rent arrears and eviction.

Although being in paid work exempts households from the benefit cap, a survey of kinship carers by FRG found that two-thirds were unemployed, with almost half having given up work permanently to become a carer. The government’s own modelling estimates that more than 330,000 children from low-income families in Great Britain will be hit by the benefit cap, costing those affected an average of £63 a week.

FRG said research showed that children brought up by relatives do significantly better academically, and have fewer emotional and behavioural problems than those reared in the care system, despite suffering similar adversities.

The warning comes as research published on Tuesday shows that the number of children looked after by relatives is increasing, with one in every 74 children in England brought up by relatives. More than half are cared for by their grandparents, and a fifth by older siblings. More than three quarters of the 153,000 children in England cared for by relatives live in deprived households, according to the study by Bristol University’s Hadley centre for adoption and foster care studies.

However, estimates by FRG suggest that only a third of kinship carers receive any financial support from their local authority. Ashley called on ministers to introduce paid leave for kinship carers, similar to adoption leave, to enable children to settle without forcing the carer to give up work.

Just under 70,000 children in England were in the care system in 2014-15, the highest level since 1985. The National Audit Office estimates that around £2.5bn a year is spent supporting children in foster or residential care in England. The NAO said average annual spend on a foster child is £29,000 to £33,000, while a residential place typically costs £131,000 to £135,000.

Lucy Peake, chief executive of Grandparents Plus, said: “We are calling upon the government to ensure children in kinship care get the help and support they need, and to protect them from the impact of welfare reform.”

A government spokesman said: “We recognise the vital role played by kinship carers who enable children to be brought up by someone they already know and trust and want kinship carers to receive more support.”