Child Poverty

Tuesday 26th January 2016 Westminster Hall

11:00

[Peter Dowd (Bootle) (Lab)]

I beg to move,

That this House has considered levels of child poverty.

I am pleased to serve under your oversight, Mr Howarth.

“Even if we are not destitute, we still experience poverty if we cannot afford things that society regards as essential. The fact that we do not suffer the conditions of a hundred years ago is irrelevant… So poverty is relative—and those who pretend otherwise are wrong.”

I start by agreeing with the Prime Minister, who hit the nail on the head when he said that in his 2006 Scarman lecture. Consideration of the levels of child poverty is a matter of huge significance. A reasonable definition of poverty proposed by the Joseph Rowntree Foundation is

“when a person’s resources are not enough to meet their basic needs.”

In other words, being able to enjoy the activities of normal daily living is important. The Prime Minister agreed with that in practical terms.

I do not want our consideration to turn into a political football, but given the political choices that the Government have made in this policy area, it would be almost impossible not to stray on to that pitch. I take it as read that, at some point or other, a Government Member will mention the apparent mess in which Labour left the country; how the Government have got the country back on track and saved the day but that there is still much to do; how the country needs to fix the roof while the sun shines; how we have to live within our means; and, of course, every other cliché to which Ministers can lay their tongues. Unlike the world economic crisis of 2008, which was clearly and wholly the fault of the last Labour Government, even I acknowledge that the current international economic uncertainty has little to do with Government policies, but that cannot be an excuse or an alibi for the Government to shirk from ensuring that child poverty does not increase.

[Nick Thomas-Symonds (Torfaen) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Howarth. Does my hon. Friend share my concern about what the Social Mobility and Child Poverty Commission said just before Christmas:

“It has long been obvious that the existing child poverty targets are not going to be met. In fact they will be missed by a country mile”?

Does he agree that that is a damning indictment of the Government’s policies?

[Peter Dowd]

It is a damning indictment. If just one organisation was saying that, perhaps we could bypass it, but organisation after organisation is identifying that as a cause of concern. Somewhat topically, if the Government can exempt the most powerful of commercial institutions from paying their due taxes or can slope away from challenging the practices of bankers, who are the real culprits in the economic chaos of 2008, surely they can protect our children from the worst effects of those who seem unable or unwilling to pay decent wages.

The existence of any level of child poverty in one of the world’s wealthiest countries should be a source of deep concern to everyone in this room, but it should also be a source of shame that the levels of child poverty in this country are high and rising. I have many friends who either were or are teachers or health and social care professionals—they work or have worked to make the lives of children better, easier and gentler—but such professionals have a hard task. They have spent much of their careers seeing the number of children in poverty beginning to drop. For example, poverty reduced dramatically between 1998 and 2011, when 1.1 million children were lifted out of poverty, but that has changed over the past few years, as my hon. Friend said. Austerity has taken its toll, particularly on those who can least afford it. Figures from the Department for Work and Pensions indicate that, since 2010, child poverty has, at best, flatlined. Meanwhile, the number of children in absolute poverty has risen by half a million since 2010. That is 100,000 children every year, more than 8,000 children a month, almost 2,000 children every week or, put another way, 300 children a day for five years—year in, year out—which cannot be right.

Let us not beat about the bush. The unspoken question on many minds is whether that poverty is due to the fecklessness of parents. Well, I think not in most cases. More than two thirds of children affected by poverty live in households where at least one member is in work. God knows what type of work permits and enables such poverty, but they are, none the less, in work. End Child Poverty, an organisation considering such issues, is particularly concerned about the rising poverty in working families. As the Joseph Rowntree Foundation report, “A UK without Poverty,” noted,

“Too often, public debate talks about ‘the poor’ as if they were a separate group of people with a completely different way of life.”

[Imran Hussain (Bradford East) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Howarth. Does my hon. Friend agree that low-wage, low-skill economies lead to an increase in child poverty? In my constituency, Bradford East, we have an absolute child poverty rate of 28.6%, compared with a national average of 18.2%, which is unacceptable. Does he agree that one solution is not this rhetoric of more employment, which the Government keep telling us, but to provide high-skill, high-wage jobs, so that families cannot just survive but live properly and children are brought out of poverty?

[Peter Dowd]

I agree with my hon. Friend, and I will come back to that in a moment.

[Nick Thomas-Symonds]

I am grateful to my hon. Friend for giving way again. He is making an important speech on an important topic, and I congratulate him on securing this debate. He has mentioned poverty suffered by people who are in work. Does he agree that the cuts that the Government are introducing to the work allowance of universal credit from April 2016 will make that situation worse? Perhaps that explains the enormous turnout of Tory Back Benchers to support the Minister today.

[Peter Dowd]

I agree with my hon. Friend. I spoke earlier about Members in the room being deeply concerned about poverty, but obviously not that many Government Members are concerned.

I will finish the quote from the Joseph Rowntree Foundation report:

“In reality almost anyone can experience poverty—over half of the population spent at least one year in relative income poverty between 1991 and 2003.”

Even if we accept that fecklessness is a factor, it is only part of the picture, and not a very big part. It becomes another alibi for doing little about the problem. Blaming poor people for being poor, even when they are working hard, is unconscionable. Shakespeare is always a good source for thought:

“And, being rich, my virtue then shall be,

To say there is no vice, but beggary.”

My late mother was a war widow. She died at the age of 95 and had been a widow for 50 years. Her mother was a war widow and a war mother—she died at the age of 106 and had been a widow for 67 years. Much, if not most, of their time was spent in relative poverty, with poverty for their children, too. Was that right? As the youngest, I feel that I was lucky, but luck should have nothing to do with it. That cannot be right.

The country’s economic structure plays a significant part in poverty. For example, the Government are still not concentrating on the effects of the productivity gap, which accounts for billions of pounds in lost GDP. My hon. Friend the Member for Bradford East (Imran Hussain) raised that issue earlier. Output per worker remains 2% below the pre-crisis levels of 2008, whereas in the rest of the G7, it is 5% higher. The Economist has said:

“The French could take Friday off and still produce more than Britons do in a week.”

In an article in MoneyWeek last year, Simon Wilson indicated:

“Bank of England calculations suggest if productivity had kept pace with the pre-2008 trend, the UK population might on average be 17% better off than it is today.”

Rather than pointing the finger at the poor, the Government should get that same finger out and address that driver of poverty.

[Jo Cox (Batley and Spen) (Lab)]

I have statistics similar those of to my hon. Friend the Member for Bradford East (Imran Hussain). In my constituency, one third of all children, 33%, live in poverty, which is heartbreaking and shocking for the many hard-working families there. Does my hon. Friend the Member for Bootle (Peter Dowd) welcome the major defeat in the Lords last night of the Government’s attempt to abolish income-related child poverty targets, and does he agree that it is simply not credible to tackle child poverty without acknowledging the worst issue, a lack of money? For the Government to attempt to abolish that target is simply reprehensible.

[Peter Dowd]

I agree with my hon. Friend, but I think a pattern is beginning to develop with this Government: they redefine everything when it does not suit them. So, for example, affordable housing now means a house costing £400,000 or £500,000. Everything is redefined to suit the Government’s agenda.

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

To follow on from the point made by the hon. Member for Batley and Spen (Jo Cox), is the hon. Gentleman as concerned as child poverty charities are by the Government’s attempt to redefine child poverty? It is important to publish annual figures on income-related child poverty, if for no other reason than the long-term impact of such poverty on health, development, educational outcomes and life chances.

[Peter Dowd]

The hon. Lady makes an important point. As I said earlier, even the Prime Minister accepts that there is relative poverty, and all the jiggery-pokery with definitions is not going to make that untrue.

[Liz McInnes (Heywood and Middleton) (Lab)]

Is my hon. Friend aware that the Child Poverty Action Group has stated that it costs £29 billion a year to respond to the issues caused by child poverty? CPAG says that it is a false economy to drive up child poverty and that this Government should be considering measures to drive it down.

[Peter Dowd]

My hon. Friend is absolutely right. She has stolen my thunder—I will refer to that figure later—but she makes an absolutely valid point.

The Government’s January 2014 evidence review of the drivers of poverty found that a lack of sufficient income from parental employment, not just worklessness, is the most important obstacle to getting children out of poverty. Of course, to pick up on what my hon. Friend said, the Government say that a high-skilled, high-wage economy will lift family incomes—ergo, poverty will fade away. In the world where many of my constituents live, it does not quite work like that. I am afraid that even combined with increased personal tax allowances, the increase in the minimum wage, or whatever the Government want to call it—another redefinition—does not go far enough to alleviate child poverty to any substantial degree.

There can be no doubt that child poverty is rising and that it has an effect on educational outcomes, health outcomes and job prospects in the longer term. Independent projections from the Institute for Fiscal Studies indicate that, as has been mentioned, child poverty is beginning to rise. Research by End Child Poverty identified that 4.1 million families and 7.7 million children have been affected by below-inflation rises in both child benefit and child tax credit over the past few years. Interestingly, poverty of aspiration by the Government in policy terms begets financial poverty, because it restricts the use of the very tools that could tackle the drivers of poverty.

In my constituency, child poverty in one ward has reached 40%. Across the constituency, it is around 30%. In other words, almost 7,000 children in my constituency live in poverty. That cannot be right. Remembering the point I made earlier about the number of children in working families who still live in poverty, youth unemployment hovers between 8% and 9% and adult unemployment at about 7%. The median wage is £470, below the national median level of £520 and the regional level of £480. What message is that sending to our children: “Start your life in poverty; get a job on low wages; and you’ll still be in poverty—and so, in turn, will your children.”? It is hardly the most encouraging of straplines for young people.

In 2015, £7 million in early intervention funding was allocated to Sefton Council, in whose area my constituency sits. That is a reduction of £10 million since 2010 in early intervention, the very thing we should be getting to grips with. How can that funding cut help alleviate child poverty? Problem debt in Bootle is £12.5 million. The Children’s Society suggests:

“Too often, when families are struggling with repayments, the response from creditors is unhelpful…a breathing space scheme”

would give

“struggling families an extended period of protection from default charges, mounting interest, collections and enforcement action”,

enabling them to seek advice and preventing them from falling deeper into the debt trap. That is a practical suggestion.

I believe that my constituency is not an outlier in statistical terms; it is typical of many areas, both rural and urban. It is lazy to suggest that people are shirkers. Levels of child poverty in this country are dreadful. They are a blot on the integrity of our society. The Government cannot solve all the problems, nor does anyone expect them to, but poverty costs money. As my hon. Friend the Member for Heywood and Middleton (Liz McInnes) said earlier, the cost to the UK of poverty is reckoned by one assessment at about £29 billion pounds: almost £6 billion in lost tax, £15 billion for extra spending on services to deal with the consequences of poverty and £8.5 billion in lost earnings to individuals. What a waste! Surely, even forgetting the human stories and experiences behind those figures, the statistics and costs are enough to make any Government reconsider their strategy for dealing with the child poverty that our country faces.

As Nelson Mandela said, standing just yards away from here while he addressed Parliament,

“poverty is not natural. It is man-made, and it can be overcome and eradicated by the actions of human beings.”

I have managed to agree with the Prime Minister and Nelson Mandela in one fell swoop, which does not happen very often.

11:17

[The Minister for Employment (Priti Patel)]

It is a pleasure to serve under your chairmanship, Mr Howarth. I thank the hon. Member for Bootle (Peter Dowd) for securing this debate. I agree completely with him that child poverty is an incredibly important issue, and that child poverty levels are too high in this country. Indeed, he and I discussed the indicator and its importance to addressing child poverty while discussing the Welfare Reform and Work Bill in Committee not long ago.

The issue is of immense importance. The hon. Gentleman referred to my right hon. Friend the Prime Minister in his remarks. Tackling child poverty is close to the Prime Minister’s heart, and it is at the heart of this Government’s agenda. We have committed to eliminating child poverty and to improving the life chances of children up and down the country. They are the future of this country. It is also important to recognise, as the hon. Gentleman has done, that poverty is not natural. At the same time, it should not be defined by arbitrary measures. We must look at the actual causes of poverty and how we as responsible Government and parliamentarians use policy levers to create the right solutions to address the actual causes of poverty.

[Nick Thomas-Symonds]

Does the Minister agree with what the Social Mobility and Child Poverty Commission said just before Christmas? It said that

“it is not credible to try to improve the life chances of the poor without acknowledging the most obvious symptom of poverty, lack of money.”

Will she take this opportunity to confirm that in defining child poverty, the Government will take into account income, as well as their defeat on this matter in the House of Lords last night?

[Priti Patel]

I recognise the defeat that took place in the House of Lords last night. It is a perfectly normal part of the parliamentary process. On income measures, we will continue to use the number of households below average income. On the point about the Social Mobility and Child Poverty Commission, the SMCP itself is clear that the current approach focuses on dealing with symptoms and not the underlying causes of child poverty. Of course, that is exactly the purpose of this Government.

In fact, we debated this issue very extensively during the passage of the Welfare Reform and Work Bill. We are focusing on the root causes rather than symptoms. It is also important to say that we are seeking to prioritise the areas that will make the biggest difference and help to transform the lives of children.

[Nick Thomas-Symonds]

Will the Minister simply confirm something? Does she agree that lack of money is an obvious measure of poverty—yes or no?

[Priti Patel]

Income is a significant part of this issue, but there are many other causes as well. Through the Welfare Reform and Work Bill, we are focusing on certain factors, because all the evidence tells us that the factors that have the biggest impact on child poverty and our children’s life chances, and consequently they become the real drivers, are focus on education, educational attainment and work, because they make the biggest difference to disadvantaged children, both now and in the future.

In particular, with the new life chances strategy we are focused, as I have already said, on tackling the root causes. The Prime Minister has already outlined that strategy, which sets out a comprehensive plan to fight aspects of disadvantage and extend opportunity. However, we should also recognise that many of those in poverty have to confront a range of challenges and issues, such as drug addiction, alcoholism and health issues, including poor mental health. It is important that we use the right public policy levers to bring the support together to deliver the right services and mechanisms for those households.

The strategy will include a wider set of non-statutory measures on the root causes of child poverty, including family breakdown, the problem of debt, and drug and alcohol addiction. These measures will sit alongside the life chances measures in the Welfare Reform and Work Bill. This spring in particular will present an opportunity to examine the details and to consider how we start to address these deep-rooted social problems, and how we can work collectively—by using public policy and the delivery mechanisms that we have in all our communities—to focus on how we can support children and transform their lives.

[Jo Cox]

I thank the Minister for giving way. I just want to push her a little bit on whether she will now accept the defeat last night and listen to a range of experts, the Social Mobility and Child Poverty Commission, and the public, who feel that the Government should report annually on income-related aspects of child poverty. While I acknowledge that child poverty is a complex issue, the income dimension is such a key part of it that it is not credible to ignore it.

[Priti Patel]

The Bill is going through the right process of scrutiny now in the Lords, as it already has in the Commons. Of course, we will consider all responses when it comes to considering the next steps in particular. That is the right and proper parliamentary process and of course all legislation goes through it.

Once again, however, I must emphasise that there is no silver bullet for this situation; there is no way in which child poverty can be just addressed overnight. A range of areas need to be looked at and, as I have said, tackling the root causes is a fundamental step in the right direction.

[Nick Thomas-Symonds]

The Minister is being very generous in giving way. Does she accept that trying to change the definition of child poverty simply confirms what the Social Mobility and Child Poverty Commission has said about missing the existing targets by a country mile? Are the Government not just trying to change the definition because they will miss the targets?

[Priti Patel]

I completely reject that assertion for many reasons, and I do not have the time now to have the full debates that we had in Committee; please forgive me, Mr Howarth.

This process is not about moving goalposts or changing definitions; it is about making a fundamental review of the approach that we take. I will not be tempted by the hon. Member for Bootle, who basically said that I would inevitably regale Members with what happened under Labour. However, this process is a fundamental shift in the strategy and the approach that are being taken. The approach is a holistic one, looking at the root causes and recognising that we have to address, for example, the number of workless households and the causes of worklessness, and ask why households have been workless in the past, and recognising that having work in households changes the future outcome for children and of course redefines child poverty and what it means to households.

We should also recognise in this debate that work plays a very important role in addressing the issue of poverty, including child poverty, because we know that work is the best route out of poverty. Evidence has shown that nearly three quarters of poor workless families who have found employment have escaped poverty. So these are some of the crucial underlying factors that we have to address, and of course work—

[Liz McInnes]

Will the Minister give way?

[Priti Patel]

I will give way just one more time, because there are other points that I want to make.

[Liz McInnes]

I thank the Minister and I will ask a brief question. If work is the route out of poverty, can she explain why two thirds of those who are defined as being in child poverty are in working households?

[Priti Patel]

We should also recognise that evidence shows that the highest poverty exit rate—75%—was for children living in families who went from part-time to full-time employment. Of course, as the economy grows, and through the introduction of the new national living wage as well, we will see those households benefiting much more when it comes to income in particular.

Regarding the hon. Member for Bootle’s own constituency, the latest figures show that the number of children living in households that receive out-of-work benefits fell by 7% between May 2013 and May 2014. Of course, we are seeing that trend develop by providing more employment opportunities, by recognising that, of course, work is the best route out of poverty, and by finding the right employment to support those families in particular to gain employment.

[Imran Hussain]

I accept that work assists with removing child poverty. Nevertheless, while the Government talk about mass employment and this road to economic recovery, in my constituency of Bradford East many of the jobs are zero-hours contracts, part-time work and poorly paid work. That does not assist my constituents and it certainly does not go towards eradicating child poverty in my constituency.

[Priti Patel]

There is good news in the economy and not all the jobs in the hon. Gentleman’s constituency will be part-time, low-paid or zero-hours, so he has made a sweeping generalisation. However, regarding his point about low-skill, low-wage work, he is right; that is a wider issue in the economy that we must tackle. Tackling it is based on getting a higher skill country and economy, which can only be achieved by our being competitive as an economy and by investing in education, which is exactly what this Government are doing, and by focusing on education as a key factor in transforming the outcomes and lives of children in particular. Educational attainment is the biggest single factor in ensuring that poor children do not end up as poor adults and get stuck in that cycle of dependency and that cycle of low wages and low skills.

We all know that good English and maths are important. There are plenty of studies—hundreds of them, and international studies as well as national ones—that recognise that those subjects are key aspects in improving children’s future life chances. Focusing on educational standards and having a new, vigorous curriculum are part of this Government’s commitment. However, educational attainment is also important. In areas of deprivation, turning around schools that unfortunately have been focused on low standards and low outcomes, and ensuring that we have more good and outstanding schools, particularly in areas of deprivation, including wards, is important, and we would all support that.

Hon. Members have obviously touched on measures in the Welfare Reform and Work Bill, but once again we must look at the changes that we are introducing, particularly regarding welfare. This process is not about individuals and using some of the terms that have been used: I think that the language that the hon. Member for Bootle used about shirking should not be used at all.

In the minute or so that I have left, it is important for me to emphasise that part of these reforms is focusing on the support that we can provide to individuals; not only cash payments but support to help people to get into work. That is exactly what the Welfare Reform and Work Bill is about.

I want to reassure the House about our focus when it comes to eliminating child poverty. The Government and this Prime Minister have been very clear about that. Our focus is on work and education, on a commitment to improving the life chances of all children and—importantly—on tackling the root causes of child poverty.

Question put and agreed to.

11:28

Sitting suspended.