Rethinking child poverty through enrichment accounts

Two kids sit beside each other in a primary school classroom. The first attends drama lessons and loves to perform; she recently watched a play based on the book they are studying in class. The other wanted to learn guitar but his family couldn’t afford the fees, so he stopped asking after that. When the first child speaks about the book in class, the second is embarrassed not to understand and feels cut off from social life at school, appearing disengaged. In situations like this, state schools can become a two-tiered experience, despite the shared classroom.

This is the reality for the 4.5 million children living in poverty across the UK. But access to enrichment is not only essential for these children; it can also act as a lifeline out of poverty.

Our child poverty strategy report, published in June, laid the groundwork for ‘individual enrichment accounts’: ring-fenced funds for eligible low-income families to spend on enrichment activities such as school trips, drama lessons, sports clubs, and more. 

For parents, enrichment provides a form of early years childcare through after-school activities (enabling them to work more hours) and boosts school attendance, keeping teenagers in school. For children, it provides a safe space outside the home, providing a sense of belonging and improving mental wellbeing. But it also increases educational attainment and develops soft skills (like communication and teamwork) which are essential to future employment. Access to the social and cultural capital provided by enrichment is crucial to setting children up for the future, with pupils who participate in arts, music, and hobby-related clubs more likely than their peers to progress to university. Participation is vital to early development, but its long-term role in alleviating poverty is often overlooked. 

Despite the benefits of enrichment, funding for these activities has become increasingly limited. Guidance on the spending of pupil premium (provided to schools in England based on the number of pupils eligible for free school meals (FSM) in the past six years) focusses on reducing attainment gaps, with extracurriculars framed as a low priority ‘wider strategy’. Direct measures for improving outcomes are essential, but enrichment uniquely supports children to develop as people, not just as students. Following this guidance and constrained by tight budgets, schools across the country have cut enrichment opportunities. In March, the majority of senior leaders in primary schools – and one-third in secondary schools – reported cuts to trips and outings for financial reasons. In schools where trips haven’t been cut, pupil premium is used to plug budget gaps to fund extracurricular activities for non-pupil premium students. Funding pressures are preventing targeted enrichment opportunities for the disadvantaged students who need it most. 

And children miss out as a result. One in three families have had to cut back on their children’s extracurricular activities post-pandemic, but low-income households have unsurprisingly been hit hardest. Children on FSM are 11 per cent less likely to attend sports clubs and 9 per cent less likely to attend other clubs (such as arts and drama), even after accounting for their parent’s socioeconomic class or qualifications. 

When opportunities are available, disadvantaged children still may not feel fully able to participate. Nearly one-quarter of parents believe their children are increasingly worried about their family finances and with enrichment seen as a luxury, self-exclusion is common.

“My parents said like they’d pay for it but then I don’t think I would enjoy it so I would just be wasting money that could go to like things that we actually need.” 

Year 9 student from Greenfields School 

Despite being aware of the benefits, cost-of-living pressures undermine the ability of families to buy a musical instrument or sports kit before their child has even had the chance to take part. Quality enrichment opportunities allow children to build on school-developed interests in a safe environment, but if the costs of entry are too high, these interests are stifled.

Enrichment for children in poverty can only be supported if the financial barriers to participation are addressed. The solution is individual enrichment accounts, which could be integrated within the universal credit (UC) system. The recently announced expansion of FSM to all children in households claiming UC from September 2026 presents the perfect opportunity to introduce targeted measures for children on FSM at the household level. Parents would be able to access ring-fenced enrichment funds within the online UC portal by submitting funding requests for activities. Once approved, these funds would go directly to providers, whether they are offered in school or externally.

We recommend an annual top-up of £410 per child living in a household claiming UC. This could increase to £510 for children in Year 7 to Year 9 to account for the likely increase in weekly enrichment costs as children grow older. These funds would ensure a minimum of two hours of enrichment per week over the school year, provided in school and externally. For children in Year 10 and 11, funding should be decreased, as children tend to specialise at this age and so reduce the range of activities they participate in, irrespective of household income.  

Initially we would suggest focussing on the youngest children at a cost of around £300 million, and then scaling up the policy to older children over time for a total cost of up to £1.4 billion. Provision across all ages may be expensive, but a necessary investment to support the transition from childhood to adolescence, particularly following years of underfunding and deepening social divides.

Enrichment accounts directly support children in poverty by breaking down the structural barriers which maintain the gap between the haves and have-nots. But removing these barriers has benefits far beyond individual households. By reprioritising enrichment through the roll-out of targeted accounts, these opportunities become a matter of basic entitlement, not income. Children who may not qualify for an account but who still lack local opportunities will benefit from the increased demand and the broader provision of local enrichment activities.

Investing in early years enrichment is investing in the future of the UK. The government’s recently announced ‘Building Creative Futures package’ is a promising step in the right direction, but £22.5 million for after-school activities in 1.25 per cent of schools across the UK, and £30.5 million for youth club infrastructure for children in poverty, is not enough. 

More substantial investment is needed to ease the weekly costs of enrichment activities that burden low-income parents. If the government fails to alleviate these cost pressures within their upcoming Enrichment Framework and Child Poverty Strategy, another generation will be left behind. Poverty requires intervention at the earliest stage, and enrichment accounts which support parents now and children for the future must become a government priority.

Notes on our costings

Estimates based on the median costs of school clubs (£3.88) and community clubs (£6.67) for primary school students in the UK. Participation in one school club and one community club, based on these estimated costs, for all 39 weeks in the school year would cost £411.45 per child per year. 

Assuming the weekly costs of enrichment (delivered both in school and externally) are 25% higher for secondary school aged children compared to those in primary school.