Free school meals and child poverty

This weekend a commitment was made by the Deputy First Minister that, if the SNP win the next election, they will extend universal free school meals to all attending primary school, covering both  breakfast and lunch, a policy that it is claimed will reduce child poverty. There’s no official published economic, financial or inequalities appraisal from the government just yet, but reports suggest that the total cost is estimated at £230 million a year.

School meals have been in the news across the UK throughout the pandemic, not least due to the campaigning of footballer Marcus Rashford to ensure that there is provision throughout the school holidays. To the credit of the Scottish Government, they responded much quicker to provide reassurances on this than the UK Government, who dragged their feet before making the same commitment to fund school meals through both the summer and Christmas holidays.

But the Scottish Government proposal is slightly different – here it is about extending entitlement during the school term (and school holidays) to all children, not just those who qualify for free school meals due to low income. This is effectively making what was a means tested benefit into a universal offering for primary school issues.

There is no doubt that it is an absolute disgrace that children are going hungry in Scotland in 2020. This is an issue that must be tackled and should have been years ago. But is this the right way to go about it? How does giving free school meals to children not in poverty help reduce poverty?

The current system and changes proposed

Currently there is a bit of a mish mash of entitlement to free school meals at primary school. Children in P1 to P3 already get free school lunches during term time, with eligibility for breakfasts varying from council to council.

Eligibility for free school meals for children in P4 and above is usually dependent on eligibility for qualifying benefits, plus an additional income test in some cases.

These qualifying benefits include out-of-work benefits and for those in work but, receiving benefits (some on Universal Credit, Child Tax Credits and Working Tax Credits), there are additional income criteria. For example, monthly earned income must be less than £610 for those in receipt of Universal Credit to qualify for Universal Credit.

The announcements made over the weekend bring more children under the universal provision as well as extending the provision to cover breakfasts as .

Means tested vs universal benefits

There are trade-offs between offering universal coverage versus means testing.

The case for universal benefits to tackle poverty has some clear merits. First is that it guarantees that those who need it receive it and removes any stigma in receiving the benefit. Not all children entitled to a free school meal are registered for one, and not all of those registered take up a free school meal on the day[i].

It also removes the complexity around applying for the benefit and any uncertainty over whether your family is entitled – in quickly changing financial circumstances it can be hard to work out what benefits you should be able to access.

There are also the appalling examples of children whose families have no recourse to public funds due to their immigration status. Whilst there are some circumstances where free school meals are provided to these children, this change will ensure that those children have the certainty of two meals a day, regardless of their situation.

Lastly, a universal benefit has no cliff edge, so it does not disappear when your family’s income rises marginally above a cut off imposed by the eligibility criteria for free school meals. The extent to which this disincentivises decisions to increase hours of paid work, for example, is not well understood, but for some families it may be part of the many factors they will try to consider when making decisions about family finances. Removing this cliff edge will remove any possible disincentives to work that the previous means tested system imposed.

However, the trade-off for this simplicity is expense. Obviously, if you are giving the benefit to all children, rather than a smaller proportion who are living on low incomes, then it costs significantly more.  And many families – including some of the most well off in society – will gain from the free school meals when they can easily afford them.

This can be seen from the appraisal carried out for the Scottish Child Payment which looked at the option of delivering the payment through the near universal Child Benefit. To get the same reduction in poverty (3 percentage points) Scottish Government analysts estimated that the cost of the universal route would have been £460 million compared to £250 million for a more targeted approach. The cost-effective approach was to make the payment targeted through qualifying benefits (similar to how free school meals currently operates) and this was the route which was chosen.

This was a conference announcement, and an early manifesto commitment, but still it is from the party of government. Where is the appraisal setting out the costs and benefits of the proposal, and the alternative options? Where have issues around universalism vs. targeted supported been set-out and evidenced? How much ‘deadweight’ – i.e. the cost of providing free school meals for well-off families who can easily afford them – will this policy cost?

Are universal free school meals the best tool for tackling child poverty?

Could this money have been used more effectively to target child poverty? Probably. Would that be as much of a vote winner? Probably not. Effective policy to tackle child poverty requires careful thought and honest assessment of the trade-offs. And if the policies are to be announced as poverty reducing measures, then assessment of the options available (for what is a significant amount of money) is needed.

Universalism is seen elsewhere in Scottish Government policy – for example with free childcare hours. Yet there does seem to be some inconsistency with regards to when it is regarded the right thing to do and when it isn’t.

As well as the route taken for the Scottish Child Payment, this point has been illustrated by another announcement trailed this morning aimed at children. This one is a targeted grant paid out to children currently entitled to free school meals of £100 to be paid out before Christmas which will be funded using consequentials from recent Covid-19 spending south of the border.

This has been called for from many charities ever since the decision was taken to postpone the introduction of the Scottish Child Payment to 2021 rather than before Christmas 2020 as was originally planned (see here for some of the options we laid out back in May for getting money in parents pockets quicker). Quite why it has taken so long to announce is unclear and many will raise an eyebrow that this policy is being announced at a SNP Conference even though it will be government and local authorities (we presume) that will have to deliver this grant payment in fairly short order. More details may come in the First Minister’s speech later today.

Child poverty is a systemic and deep routed issue that has been prevalent in our society for too long.  However, universal free school meals all year round are unlikely to be the most effective way of tackling this issue. A more thorough and evidence-based system of deciding how best to spend money, which we are regularly told by Scottish Ministers is in such short supply, to help those who need it most cannot be sacrificed in order for eye-catching policies at Conference however well-meaning they are.

[i] See the School Healthy Living Survey Statistics 2020, Scottish Government, available here

Authors

Emma is Knowledge Exchange Fellow at the Fraser of Allander Institute

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