Official Statistics

Background information and methodology: Universal Credit and Child Tax Credit claimants statistics

Published 13 July 2023

Coverage: United Kingdom

Context of the statistics

What are Child Tax Credit and Universal Credit?

Universal Credit (UC) is a flexible system which supports people both in and out of work. It replaces 6 legacy benefits:

• Child Tax Credit
• Housing Benefit
• Income Support
• income-related Jobseeker’s Allowance (JSA)
• income-related Employment and Support Allowance (ESA)
• Working Tax Credit

Child Tax Credit (CTC) provides income-related support for families with children or qualifying young people aged 16-19 who are in full time non-advanced education or approved training, payable to the main carer. Families can claim whether the adults are in work or not.

Read further information about Universal Credit, including making a claim.

Read more information about Child Tax Credit, including making a claim.

What is the policy to provide support for a maximum of two children?

Since 6 April 2017, families can claim support for up to two children. There may be further entitlement for third or subsequent children if they were born before 6 April 2017 or if an exception applies.

The policy aims to ensure fairness between claimants of benefits and those who support themselves solely through work. The child disability element of UC and CTC will continue to be paid for all eligible children. In addition, Child Benefit continues to be paid for all children and additional help for eligible childcare costs are also available regardless of the total number of children in the household.

What are the exceptions to the policy?

In recognition that some claimants are not able to make choices about the number of children in their family, the Government has put in place exceptions for certain groups. In both UC and CTC, there are four categories of exceptions. They apply for:

Third and subsequent children who are:

• additional children in a multiple birth where an extra amount will be payable for all children in a multiple birth other than the first child
• likely to have been born as a result of non-consensual conception, which for this purpose includes rape or where the claimant was in a controlling or coercive relationship with the child’s other biological parent at the time of conception

An exception also applies for any children in a household who are:

• adopted when they would otherwise be in local authority care
• in non-parental caring arrangements when they would otherwise be at risk of entering the care system, including where a child (under 16) has a child

On 28 November 2018 exceptions for non-parental care and adoption arrangements were extended to apply to any eligible children in a household.

Read further information on the policy and the exceptions in Universal Credit.

Read further information on the policy and the exceptions in Child Tax Credit.

Purpose of the statistics

Who might be interested?

The statistics contained in this publication will be of interest for anyone that is looking for information on the impact of the policy to provide support for a maximum of two children, and the exceptions.

What does this publication tell me?

This publication shows the number of claimants (single or joint households with any dependent children or young people) affected by the policy to provide support for a maximum of two children. Claimants are counted on Universal Credit if they have an open UC claim within the month of April. For Child Tax Credits, claimants are counted if they were eligible for a positive CTC award on 2nd April 2023.

Claimants are considered to be affected by the policy if they have added a third or subsequent child to their household since the policy was introduced on 6 April 2017, including those for whom an exception applies. The tables show the number of claimants in these two categories (those for whom an exception does or does not apply), split between UC and CTC claimants. Numbers of exceptions are broken down into exception type, country and region of residence, and those affected are broken down into work status, number of adults in the household, and country, region and local authority of residence.

This publication also shows the number of children that are affected by the policy, and the number of children in households that are not receiving an element, including a breakdown by the number of children in a household.

This publication includes regional breakdowns of the number of households affected by the policy, along with local authority breakdowns of the number of households with 3 or more children, and the number of households affected by the policy and not receiving a child element/amount.

To improve the way local authority breakdowns are displayed, the proportion of all households with 3 or more children that are affected and not receiving the child element by local authority is included. This has been done to allow comparisons between local authorities.

The coverage of the statistics mirrors the areas of responsibility of the Department for Work and Pensions (DWP) and HM Revenue and Customs (HMRC). Consequently, statistics on UC relate to the Great Britain, whereas CTC statistics relate to the United Kingdom. Northern Ireland statistics for CTC are shown in certain tables.

The statistics in this publication relate to the policy which has been in operation since 6 April 2017. In future years, more households with two or more children claiming UC or CTC will have a child who has been born on or after 6 April 2017, and so the numbers affected will increase over time.

The publication does not contain information relating to those who have applied for an exception but have not met the criteria to qualify. Once claimants have submitted supporting documents which meet the eligibility criteria for an exception, the exception will be granted and there are no circumstances in which an exception would not be granted where the correct supporting documents have been provided.

The definition of an application is also problematic for several reasons. Within tax credits, certain types of exceptions for multiple births are determined automatically by the tax credit system rather than requiring claimants to make contact. Claimants to both UC and CTC can also make enquiries about their potential eligibility for an exception, and it is not clear at what stage such an enquiry would be considered as a potential application or not.

Limitations of the statistics

A small number of CTC claimants live outside the UK (such as Crown servants posted overseas) or have no postcode information. These cases are identified as ?foreign/not known? in certain tables but are included in United Kingdom totals, in line with the presentation of other tax credit statistics.

The region and local authority information is derived from the claimant residential address, and this is not present for all households in the UC data source. Therefore, there is a small number of households with Unknown region and local authority information. For the small number of Universal Credit cases where the postcode information was not available the country of the Job Centre the claimants was allocated to has been used. Further information on the National Statistics Postcode Look-up can be found on the ONS website.

Rounding

The figures have been rounded to the nearest 10, or nearest 1%. Low numbers including zero are suppressed in accordance with disclosure rules. This can lead to components as shown not summing to totals.

Comparisons between the statistics

The coverage of the statistics mirrors the areas of responsibility of the Department for Work and Pensions and HM Revenue and Customs. Consequently, statistics on UC relate to the Great Britain, whereas CTC statistics relate to the United Kingdom. Northern Ireland statistics for CTC are shown in certain tables.

The publication includes figures on the number of households with dependent children or eligible young people, whilst in contrast data available on stat-Xplore includes all children or young people declared in a household on UC who are under 20 and whose details are verified by DWP. Therefore, there will be differences when looking at the number of households with 3 or more children between this publication and data available through Stat-Xplore.

On Stat-Xplore, the total number of children may not be equal to the number of dependent children in the household who are eligible for child element for various reasons, including children over the age of 16 in non-advanced full-time education, looked-after children and, other young people living in multigenerational households whose parents are not the claimant.

Source of the statistics

The data used in this publication is based on 100% extracts of provisional tax credit awards from the tax credit computer system (NTC), taken on 2 April 2023. The extract date was selected to ensure consistency with the parallel National Statistics release providing figures on provisional tax credits awards on the same date.

The data for Universal Credit is fully sourced from administrative data covering UC Full Service only and contains households with an open Universal Credit claim within the month of April 2023. UC Live Service are therefore excluded for figures produced prior to April 2019.

Definitions and terminology within the statistics

Tax credit awards are provisional until they are finalised at the end of the year, when claimants confirm or make changes to their incomes and other circumstances as reported at the date when the statistics were extracted.

Analysis covers all UC claims that have declared a third or subsequent child as being born on or after 6 April 2017. The number of eligible children declared was compared to the number of children paid for as part of their April payment. If there is a difference, they have been impacted by the policy and if there is no difference then they have received an exception.

A UC claim’s in work status is determined by having positive take home earnings included in their April statement.

Within both Child Tax Credit and Universal Credit data, postcode information for claimants were combined with geographical details obtained from the Office for National Statistics’ National Statistics Postcode Look-up (NSPL). England, Scotland and Wales data represent geographical boundaries derived from Census 2021 data and has been taken from the NSPL. Northern Ireland data represents geographical boundaries derived from Census 2001 data, which is still the latest available, within the NSPL.

Revisions to the statistics

An improved methodology was implemented in 2020 to improve the accuracy of the Universal Credit reported figures, specifically determining the number of eligible children and identifying UC claims affected or exempt from the policy. This increased the estimate of all households reporting a third or subsequent child on or after 6 April 2017 by 6 per cent. The figures for April 2020 onwards are therefore not directly comparable to prior years.

The underlying data source to identify children within UC Households has been updated from 2023 to align with wider DWP statistics and improve the accuracy of determining the number of eligible children and identifying UC claims affected or exempt from the policy. This has increased the estimate of households with 3+ children by 2 per cent, whilst the estimate of households affected by the policy has decreased by 1 per cent. Due to small number of households with an exception, this has disproportionately impacted these households (in particular multiple births), as it has improved the accuracy of identifying households with an exception.

Status of the statistics

National/Official/Experimental statistics

These are Official Statistics. There is ongoing development of the data systems used to support Universal Credit and as such, the methodologies used to produce these statistics are constantly monitored and is subject to revision as improved data sources become available.

Quality Statement

Validation and quality assurance processes

Child Tax Credit statistics were compared against those derived from the parallel April 2022 provisional awards dataset used to produce regular tax credit National Statistics. Results between the two datasets were broadly comparable and differences can be accounted for by minor differences in methodology.

Universal Credit statistics have been continually monitored over the past year and comparison of previous month snapshots have shown a consistent proportion of claims have been affected by the policy. Internal departmental quality assurance checks have been carried out to reassure the reliability of the statistics. Figures have also been compared to the number of claims with children declared to contextualise the percentage of UC claims which have been affected.

Feedback

We welcome feedback.

We are committed to improving the official statistics we publish. We want to encourage and promote user engagement, so we can improve our statistical outputs. We would welcome any views you have using the following contact information.

DWP Press Office: 0115 965 8781

Statistical contacts:

S Lewis, A Mays, A Wells: ucad.briefinganalysis@dwp.gov.uk

O Jasper, M Parker, D Bailey: benefitsandcredits.analysis@hmrc.gov.uk

Useful links

Latest release

Universal Credit and Child Tax Credit claimants statistics, 2023

Previous releases

Universal Credit and Child Tax Credit claimants statistics, 2022

Universal Credit and Child Tax Credit claimants statistics, 2021

Child Tax Credit and Universal Credit claimants statistics, 2020.

Child Tax Credit and Universal Credit claimants statistics, 2019.

Child Tax Credit and Universal Credit claimants statistics, 2018.

Supporting guides

Further information about Universal Credit, including making a claim

Further information about Child Tax Credit, including making a claim.