The cost of children
"The cost of children" - overview and summary
Categories of expenditure on children
Results from the "Small Fortunes" research
Results from the Family Budget Unit
Results from "The Costs of Children and the Welfare State"
Results from "Measuring the Cost of Children: Estimates for Britain"
Results from "1999-2000 Family Expenditure Survey"
Results from "Pregnancy & birth" magazine, March 2001
What the government is prepared to pay for children in benefits & tax credits
The "cost of children" references
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A related topic - sharing the wealth of the parents
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Results from "1999-2000 Family Expenditure Survey"

"This report presents information from the Family Expenditure Survey (FES) for the financial year April 1999 to March 2000. The FES is a survey of a random sample of private households in the United Kingdom carried out by the Office for National Statistics (ONS). It provides a wealth of information about household expenditure and household income." (From Family Spending - A report on the 1999-2000 Family Expenditure Survey).

Example data from the report on the survey

The report on the survey has many tables for different types of household identifying what, on average, they spent their money on. Here is a useful example:

Table 4.5 "Expenditure of one adult households with children 1999-2000 by gross income quintile group based on weighted data and including children’s expenditure"

All the households in the survey have been divided into 5 groups, from the poorest fifth (or quintile) to the richest fifth (or quintile). Single adult households with children didn't appear to have enough in the richest fifth to be worth doing the sums! (The rows in pink were not in the original report but were derived with simple arithmetic in the spreadsheet I used).

    Lowest
twenty
percent
Second
quintile
group
Third
quintile
group
Fourth
quintile
group
Highest
twenty
percent
All
house-
holds
Total number of households in sample 277 161 56 32 13 539
Total number of persons in sample 745 521 144 80 36 1526
Total number of adults in sample 277 161 56 32 13 539
Weighted average number of persons per household 2.7 3.2 2.5 2.5 2.7 2.8
Lower boundary of group ( per week)   148.00 281.00 464.00 719.00  
Expenditure groups (commodity or service) Average weekly household expenditure ()  
1 Housing (Net) 15.80 37.60 59.00 66.20
..
34.00
2 Fuel and power 11.10 11.70 11.10 14.10
..
11.70
3 Food and non alcoholic drinks 37.50 50.70 61.90 65.90
..
47.10
4 Alcoholic drink 3.50 3.80 8.40 13.20
..
5.20
5 Tobacco 6.60 7.10 3.50
[6.70]
..
6.30
6 Clothing and footwear 11.40 15.50 21.50 35.10
.
15.90
7 Household goods 13.10 22.20 28.50 29.80
..
19.20
8 Household services 9.60 13.00 27.20 38.10
..
15.90
9 Personal goods and services 5.50 7.90 13.80 14.70
..
8.10
10 Motoring 8.10 20.50 41.20 38.50
..
19.40
11 Fares and other travel costs 3.40 4.30 5.40 6.90
..
4.40
12 Leisure goods 7.40 13.10 22.00 26.30
..
12.80
13 Leisure services 10.40 14.80 41.30 50.80
..
21.90
14 Miscellaneous 0.30 1.00
..
0.60
..
0.70
1 to 14 All expenditure groups 143.50 223.20 346.00 406.90
..
222.40
Ex 1,4,5 All groups except Housing & Alcohol & Tobacco 117.60 174.70 275.10   176.90
    Average weekly expenditure per person ()  
1 to 14 All expenditure groups 53.80 70.80 136.00 163.40 .. 79.90
Ex 1,4,5 All groups except Housing & Alcohol & Tobacco 43.56 54.59 110.04   63.18

Commentary

It is hard to separate out what is spent on the adult, and what is spent on the children (of which there were on average 1.8 per household). There are various methods.

Method 1

The pink rows exclude certain commodities and services which are best assumed belong to the adult. Alcohol and tobacco for obvious reasons, and housing because the adult would probably have a house anyway (although not necessarily as big). So a way of interpreting this is as follows. Consider for example the lowest twenty percent column - the poorest households. Then on average the expenditure per person excluding these adult-only items (housing, alcohol, tobacco) is £43.56 per week, so this is right for the children. The expenditure on the adult is then £43.56 plus the excluded items: £15.80 + £3.50 + £6.60. This brings the total right. But it is still largely guesswork.

If that is done, the bottom right hand figure of the table gives the average weekly expenditure per child in single-adult households: £63.18. Compare this with the Small Fortunes average value for a single child in families (across separated and intact families) at 2001 prices: £67.

Method 2

In fact, a lot more assumptions and analysis, preferably of the raw data, would be needed to be able to separate the children and adult costs. This appears to be what was done in The Costs of Children and the Welfare State, for which there is an article here. That research didn't talk about real money, but only about proportions of expenditures on children versus adults, etc. The real money values in the above table might enable those proportions to be turned into money values. For example, see the article on The Costs of Children and the Welfare State. It describes the addition costs per extra child in a household, and by assuming that these 1.8-child households are approximately four 2-child households to one 1-child household, the sums can just about be done. Making lots more assumptions, gives the following:

  Single adult household 2-adult household
Average spend per child about £52 about £52
Average spend per adult about £129 about £204

But they are getting so derived, based on assumptions and tenuous links, that they will be very suspect. For example, using this method shows the poorest families spending far less than anyone thinks possible.

What this appears to be showing (if anything!) is that expenditures on children, according to the combination of this report on the 1999-2000 Family Expenditure Survey and The Costs of Children and the Welfare State, is significantly greater than the Income Support child allowance but less than the average expenditure in the Small Fortunes survey. It also appears to show that expenditure per adult in a 2-adult household has increased far more than expenditure per child, compared with single-adult households.

Conclusions

Do poor households spend a higher proportion of the total expenditure on the children than richer households? Small Fortunes and Sue Middleton say so. This result, and Small Fortunes itself, don't justify the simple "percentage of NRP income" approach to the reformed scheme. The table above probably doesn't show that rich adults are neglecting their children, but shows instead that they are not spending directly on them, rather spending extra on things such as Housing and Motoring which benefit the children indirectly. (Housing and Motoring expenditures both increase rapidly as households get richer). In other words, "sharing the wealth of the parents" depends on living with the parents, not just getting money from them.

References

[1] Family Spending
A report on the 1999-2000 Family Expenditure Survey
A National Statistics publication
Editor: Denis Down

[2] The Costs of Children and the Welfare State: An Empirical Analysis based on Consumer Behaviour
Richard Dickens, Vanessa Fry, Panos Pashardes
Discussion paper series no 466, December 1996
Department of Economics, University of Essex

[3] Small Fortunes: Spending on children, childhood poverty and parental sacrifice.
Sue Middleton, Karl Ashworth and Ian Braithwaite
Published by the Joseph Rowntree Foundation.
ISBN 1 85935 032 1

Page last updated: 6 July, 2004 © Copyright Barry Pearson 2003