The living wage does not cover the basic needs of families

Parents who work full-time on minimum wage still don’t earn enough to provide their families with an unpretentious lifestyle, research suggests.

A single parent working full-time on the National Living Wage is £74 a week short of what they need to achieve a basic standard of living, according to a report by the Child Poverty Action Group (CPAG).

Couples bringing up two children while working full-time on the minimum wage get £49 a week less, the charity said.

However, this was an improvement on last year, when couples were on £59 a week.

It blamed rising prices, the benefits and tax credit freeze, the bedroom tax and the launch of Universal Credit for hitting “family budgets” and called for an increase in the so-called National Living Wage.

Chief Executive (Taiwan OTC: 3345.TWO – news ) Alison Garnham said: “There is strong public support for raising the wages of low-paid parents and investing in children is the best long-term investment we can make .

“By using the upcoming Budget to unlock benefits and restore in-work benefits, the government can take action to make work really pay.”

The National Living Wage is £7.83 an hour for the over 25s.

The total cost of a child, including rent and childcare, fell from £155,100 to £150,800 for a couple and from £187,100 to £183,300 for a single parent.

This is due to the new 30-hour childcare subsidy for three- and four-year-olds, CPAG said, but the charity noted it was not available to many families, including those working part-time.

Gains from raising minimum wages were offset by freezing support for tax credits. the report said.

A government spokeswoman said fewer were living in absolute poverty today and ministers were committed to giving every child the best chance.

“The employment rate is at a near record high and the national living wage has delivered the biggest pay rise for the lowest paid in 20 years, £2,000 more per year for a full-time worker,” she added.