Benefits - and costs - of expanding access to free school meals will grow over time

• The government has announced that it will expand eligibility to free school meals to all children in England whose families receive Universal Credit, removing the current £7,400 household income cap. Free school meals are valued at £490 a year for each child.
• In the long run, this will cost about £1 billion (in today's prices) and benefit 1.7 million children between Year 3 and Year 11. The long-run impact would see around 100,000 children lifted out of poverty.
• But in the short run, both the costs and the benefits of this policy are likely to be much smaller. This is because, since 2018, transitional protections have meant that children don't lose eligibility for free school meals when their family circumstances change. While the main stage of these transitional protections ended in April this year, children who were eligible for free school meals before then will continue to receive free lunches until the end of their 'phase' of education (primary or secondary school). The ultimate impact of these transitional protections is that many more children are currently receiving free school meals than would otherwise be the case. This makes the short-run costs of expanding eligibility lower, but also means that fewer families will benefit on day one.
• Indeed, the government suggests that around 500,000 children will benefit from expanding eligibility to all families on Universal Credit. This implies a total short-run cost of £250 million (plus, depending on the precise funding arrangements, around £50 million in additional funding for devolved governments). This is less than a third of the long-run cost and impact of this policy. But it also means that today's announcement will not see anything like 100,000 children lifted out of poverty next year.
• Since all pupils in Reception to Year 2 in England are already eligible for universal infant free school meals, this policy will largely directly benefit those with children aged 8 to 16. (School-based nurseries and FE provision are also in scope for the policy, but this affects relatively few children and young people.)

Christine Farquharson, Associate Director at IFS, said: "Offering free school meals to all children whose families receive Universal Credit will, in the long term, mean free lunches for about 1.7 million additional children. But transitional protections introduced in 2018 have substantially increased the number of children receiving free school meals today - so in the short run, today's announcement will both cost considerably less (around £250 million a year) and benefit considerably fewer pupils (the government's estimate is 500,000 children). This also means that today's announcement will not see anything like 100,000 children lifted out of poverty next year.

Still, the government estimates that around 500,000 children will benefit next year from today's policy, to the tune of about £500 per child. This is a group who are on low, though not the very lowest, incomes - so compared to making free school meals universal, the policy announced today will be both cheaper and more targeted towards poorer families. There is some evidence too that school meals can have benefits for children's health and attainment. But if the government's main interest is to reduce child poverty, there are other measures - such as lifting the two-child limit - that would have a lower cost per child lifted out of poverty."