Six in 10 families on Universal Credit or Child Tax Credit in Scotland have had to borrow money since the start of the coronavirus pandemic, new research has found.
A study by the Joseph Rowntree Foundation (JRF) and Save the Children found that almost nine in 10 (86%) of parents on those benefits have faced extra household costs due to the pandemic, while almost half (46%) reported a reduction in income since March.
Seven in 10 (71%) of families surveyed said they have had to cut back on food and other essentials as loss of income and the additional costs of lockdown put increased pressure on overstretched budgets.
Meanwhile, 60% of families on Universal Credit said they have been forced to borrow money, including using overdrafts, credit cards or payday loans.
JRF and Save the Children are now calling for an urgent, temporary £20 per week increase to the child element of Universal Credit and Child Tax Credits from the UK Government.
It said this is equivalent to £2.85 per child per day – enough to cover costs such as a child’s breakfast and lunch or a bus fare to get to the supermarket.
Jim McCormick, associate director for Scotland at the JRF, said: “The coronavirus crisis has shown us that, as a compassionate society, we want to support each other and protect each other from harm.
“As well as individuals performing extraordinary acts of public service, we have also seen governments intervening to protect jobs and to boost social security as a lifeline for millions of families.
“It’s vital that we build on this to ensure that the pressures on families with children in particular are recognised and acted on.
“Families are dealing with high costs with children at home and many simply haven’t got the income they need to weather the storm.”Jim McCormick, Associate Director for Scotland at Joseph Rowntree Foundation
“Families are dealing with high costs with children at home and many simply haven’t got the income they need to weather the storm.”
The research also found that almost two-thirds (65%) of the 412 people who responded said the pressures are having a negative effect on their mental health.
JRF and Save the Children said both the UK and Scottish Governments will need to maximise their contributions to boost family incomes and reduce costs.
Claire Telfer, head of Scotland at Save the Children, said: “These new figures reveal the damage wrought by the pandemic on family finances.
“Sharp drops in income and soaring living costs have placed a huge strain on those already struggling and plunged many more children into poverty for the first time.
“It’s simply not right that parents in Scotland are having to make impossible choices about whether to put food on the table or money on the electricity meter.
“We know that growing up in poverty has enormous, long-lasting impacts on children – no child should go without the toys and books they need to learn and play because their parents are battling to cover the basics.”
The UK and Scottish Governments are being asked for comment.