This report provides new estimates of total spending by the government on children in England, including benefits, education spending,services for vulnerable children and healthcare. In the most recent year of data (2017–18), total spending was over £120 billion or over £10,000 per child under 18.
Supporting children is a major aim of public spending. This occurs through various channels and reflects different types of needs. Benefit spending is designed to support children through topping up the incomes of families with children. Education spending represents an investment in future skills and productivity. Some spending respondsto needs, such physical or mental health problems or family breakdown.
Even after the inclusion of state benefits, families with children face higher levels of poverty than other demographic groups. In 2016–17, around 30% of children were in poverty, compared with around 18% of working-age adults without children and about 16% of pensioners. A further motivation for directing spending towards children is a desire to mitigate the impact such disadvantage has on children’s life chances, and thus to improve social mobility.
Thus, there is considerable interest in just how much is spent on children through these various sources, the extent to which thismeets the needs of children and how this has changed over time. However, precisely because ofthe multiple sources ofspending on children, it can be difficult to produce clear and consistent estimates of the total level of public spending on children over time. Figures produced by the Office for Budget Responsibility show estimates of the profile of spending and taxes across an individual’s lifetime: most education spending is concentrated at younger ages, welfare spending is lower and taxes are higher during working life, and there is a gradual increase in spending on welfare, health and long-term care for older people (Office for Budget Responsibility, 2017). There is clearly significant interest in the extent to which these patterns are changing over time. The production of consistent figures over time is fraught with difficulties, however, because of changes in the nature of policy programmes and the way in which figures are presented.
Estimates also exist for long-run changes in spending in specific areas, such as education spending, early years and the welfare system . All of this work has shown that the consideration of the long run (i.e. at least ten years) is important as it provides historical context. It also shows that the overall changes can mask significant changes in priorities within particular areas of spending. One should therefore seek to show whatis happening within each area of spending over time too.
In this report, we detail the total and per-head levels of public spending on children across different areas of spending back to 2000 and projected up to 2020. Given changes in the size of the child population over this period, our headline findings are based on spending per child and how this has changed over time. We include as many different elements of spending as possible,for as many different years as possible. Our main estimates include spending on benefits and tax credits, education up to age 18, and family and children’s services (e.g. social work and Sure Start). Our main estimates exclude healthcare due to data limitations. However, we are able to include health spending for the most recent years in order to get a sense of the overall magnitude.
Luke is a Research Fellow at the IFS and his general research interests include education policy, political economy and poverty and inequality.
Elaine works in the Public Finance and Pensions sector and she joined the IFS in 2009 and became a member of the research staff in 2011.
Tom is an Associate Director at the IFS and Head of the Income, Work and Welfare sector.
Tom Lee
