The government has today confirmed how it plans to assess eligibility for free school meals (FSM) under the new benefits systems known as Universal Credit (UC).
Around 210,000 children who would not have qualified for FSM under the previous “legacy” system will gain entitlement under UC, including around 140,000 children with at least one parent in paid work.
However, an estimated 160,000 pupils will no longer be eligible (1 in 8 of the 1.3 million children who would have qualified previously), including children in workless families whose parents have unearned income or assets that disqualify them.
The figures are published in a report today by the Institute for Fiscal Studies (IFS), which found that that the extra cost to the government will be £20 million-30 million per year.
IFS research economist Tom Waters, who co-wrote the report, said: "The change in the structure of the benefits system inherent in universal credit means that the government was always going to have to come up with a new way of determining which children qualify for free school meals.
“This meant it either had to spend more public money on them in total or create some losers. Its chosen path does a combination of the two.
“It creates a substantial number of losers, but also a greater number of winners, with children of lone parents and of working parents especially likely to gain entitlement."
Under the rules, children in families with net earnings up to £7,400 will be entitled to FSM under UC, and the government has said it plans to freeze this threshold until 2021–22.
IFS analysis shows that if the threshold were increased in line with the Consumer Price Index or earnings, approximately 80,000 or 100,000 more children respectively would be entitled to FSM in 2021-22 than under the current plan.
The report also states that around two-thirds of the children entitled to FSM are in the lowest-income fifth of households. This will remain essentially unchanged after the switch to UC. However, under the UC system – as is the case under the legacy system it replaces – only about half of children in the poorest fifth will be entitled to FSM.
The report, entitled Free school meals under universal credit, by Robert Joyce and Tom Waters, is published today by the Institute for Fiscal Studies on its website.