A new study claims that the average couple with children would be financially better off if they split up.

The centre for policy studies report, "The Price of Parenthood", shows public subsidies to households with children has doubled since 1997, and now stands at £22 billion a year.

The right wing think tank says that the government is, in effect, providing a financial incentive for couples to split up. 

Author of the study Jill Kirby reports that while "financial penalties" on couples bringing up children have increased, birth rates, particularly among families of around average income, have declined.

The proportion of children growing up with one parent has risen by more than 25 per cent in the last seven years.

Kirby says the average cost to the Treasury of a marital breakdown is between £8,450 and £12,000 a year.

Lone parents receive average tax credit and benefit payments five times larger than couple households. The report states that, "far
from reforming welfare, Gordon Brown’s tax credits have merely disguised it, and the cost is unsustainable".

Welfare

Kirby concludes that to take action against child poverty and family breakdown, Britain should learn lessons from US welfare reform.

"The bias against two-parent families must be removed. Welfare support should be limited to short-term relief of hardship and should not be a substitute for family support", she said.

"When assessing a family’s needs, both parents should be involved in that assessment, regardless of whether they are living together or not."

In response to the report, Liberal Democrat work and pensions secretary, Steve Webb, said: "The evidence that couples split up in order to maximise their benefits and tax credits is practically non existent.

"It is true that there are financial pressures on couples but the solution is not to penalise children by withdrawing benefit when they split.

"When a relationship breaks down life is hard enough for the children and they should not then be forced to live in poverty."