The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)
My Lords, I am pleased to close this important debate on addressing the root causes of child poverty. It will be interesting to check with Hansard on whether this is indeed a first, as the noble Lord, Lord Bird, said, in focusing on root causes as a subject.
I thank all noble Lords for their valuable contributions and the noble Lord, Lord Bird, in particular, for securing this debate, as well as the debate on a similar topic in February. Once again, his s=-peech was a tour de force, reminding us why the noble Lord is in this House. I also pay tribute to my noble friend Lady Bottomley for giving us a historical perspective on this subject, with a few namechecks that went back, I think it is fair to say, several decades.
I echo the words of several Peers about Lord Field of Birkenhead. The first line of the statement given out by his family, which was issued by his parliamentary office, was interesting:
“Frank was an extraordinary individual who spent his life fighting poverty, injustice and environmental destruction”—
that is rather telling. As Sir Tony Blair said in his statement, he was an “independent thinker”, and we must applaud that. I would like to say that he was a thoroughly decent man and, crucially, one of our country’s great influencers. That is an important point to make.
As I said earlier, this is an important topic, and I believe we all recognise that child poverty is a complex issue that can be associated with a range of factors, including worklessness, poor educational attainment, inadequate housing, parental conflict and poor mental health. Many people who experience poverty face a range of barriers, which can make it difficult for them to manage and move on with their lives. I will say more about this later in my speech, and I acknowledge the different reasons for poverty that have been spoken to.
I will mention the annual statistics published last month. On the remarks made by the noble Baroness, Lady Lister, I doubt we will ever agree, but I took note of what she said. None of us wants to see child poverty increasing, and I share the concern expressed about this. The latest statistics cover 2022-23—please note that period—when global supply chain pressures, partly linked to the war in Ukraine, led to high rates of inflation, averaging 10% over the year, and food price inflation that reached a high of 19.1% in March 2023, which is not so long ago. These factors are reflected in the latest statistics.
In response, the Government provided unprecedented cost of living support worth £96 billion over the period 2022-23 and 2023-24, including £20 billion for two rounds of cost of living payments. This additional support prevented 1.3 million people, including 300,000 children, falling into absolute poverty—our measure—after housing costs in 2022-23. Since then, we have taken further action to support those on low incomes, including uprating benefits and pensions by 10.1% last year. The noble Baroness, Lady Lister, may not like the fact that I am reminding her of this, as she said. The latest statistics show that 1.1 million fewer people were in absolute poverty after housing costs in 2022-23 than in 2009-10, including 100,000 fewer children. I will stick with those statistics.
The noble Baronesses, Lady Lister and Lady Janke, and the noble Lord, Lord Sikka, who is not in his place, asked about the two-child policy. We believe that those on benefits should face the same financial choices when deciding to grow their families as those supporting themselves solely through work. On 9 July 2021 the Supreme Court handed down the judicial review judgment on the two-child policy, finding that it was lawful and not in breach of the European Convention on Human Rights.
Baroness Bennett of Manor Castle (GP)
I question the point about making a choice about having a child. People fall into poverty and need benefits after they have had a child. What do they do then?
Viscount Younger of Leckie (Con)
Of course, and the noble Baroness will know that I have spoken at length on this matter and that there are a number of exceptions to this particular policy. But I stick to our view that there is a balance to be struck between helping those people in the way that we do, not having the two-child policy and, equally, being fair to the taxpayer. I know that the noble Baroness will never agree to that.
Baroness Lister of Burtersett (Lab)
Does the Minister accept that many of these families are taxpayers and in paid work?
Viscount Younger of Leckie (Con)
Absolutely. As I have said before, I do not think that we will agree at all on this—but, as I say, we are not minded to move on this policy. Both noble Baronesses will be well aware of our position on this.
There are encouraging signs that the economy has now turned a corner. Inflation has more than halved from its peak, delivering on the Prime Minister’s pledge, and is forecast to fall below 2% in 2024-25. Food price inflation is at its lowest since January 2022, at 4%, and wages are rising in real terms. We remain committed to a strong welfare system for those families who need it, and have uprated working-age benefits by a further 6.7% from this month and raised the local housing allowance to the 30th percentile of local rents, benefiting 1.6 million private renters in 2024-25.
Some questions were raised by the right reverend Prelate the Bishop of Lincoln and also alluded to by the noble Lord, Lord Shipley, about social housing, which is an important subject. Their questions were linked to items of damp and mould; they asked what the Government were going to do about this. The Government have now introduced Awaab’s law through the Social Housing (Regulation) Act 2023, which gives the Secretary of State powers to set out new requirements for social landlords to address hazards such as damp and mould in social homes within fixed time periods. We are now analysing the responses to the consultation, and then we will publish a response setting out findings and bringing for secondary legislation as soon as possible.
What I should say, which think was alluded to by the noble Baroness, Lady Bennett, is that everyone has a right to a safe and decent home. Since 2001, the decent homes standard, the so-called DHS, has played a key role in providing a minimum quality standard that social homes should meet. We are currently reviewing the DHS to ensure that it sets the right requirements for decency, and we will publish a consultation on a proposed new standard soon.
Lord Bird (CB)
I am not against social housing—I am for social housing—but I want to break out of the situation whereby, if you get into social housing, you tend to fall behind everybody else. On what the Minister is saying about how they are going to change the requirements on social landlords, social landlords should be turning their tenants into people who can have a larger life and can get out of poverty. For most of them, even if they get into work, it is always in the low-wage economy, and they stay there. What are the Government doing about breaking the low-wage economy that many people in poverty find themselves in, who are often in social housing?
Viscount Younger of Leckie (Con)
Indeed, I will allude to the cross-government work that is going on. It may be that it requires a letter to write on that point, but I shall allude to it later, if I have the time.
Altogether this year we will have spent £306 billion through the welfare system in Great Britain, including around £138 billion on people of working age and children. This includes additional support to ensure the best start in life for children. For example, we have extended free school meal eligibility several times and to more groups of children than any other Government over the past half century. They are now claimed by more than 2 million of the most disadvantaged pupils. In addition, healthy food schemes provide a nutritional safety net for more than 3 million children. For those who need extra help with essentials, as inflation continues to fall, we are providing an additional £500 million for the extension of the household support fund in England, for a further six months, including funding for the devolved Administrations.
While it is right that we maintain a strong welfare safety net, we know that having parents who work, particularly full-time, plays a key role in reducing the risk of child poverty. My noble friend Lord Effingham mentioned this. In 2022-23, children living in workless households were more than six times more likely to be in absolute poverty after housing costs than those where all adults work. This is clear evidence of why, with more than 900,000 vacancies across the UK, our focus is firmly on ensuring that parents get the right support to find work and succeed in work. Our policies include: our generous universal credit childcare offer for working parents; our in-work progression offer; further increases to the national living wage to £11.44 an hour; and national insurance cuts.
The noble Baroness, Lady Lister, asked about making the housing support fund permanent. The HSF is not the only way we are supporting people on lower incomes. April’s benefit uprating of 6.7% will see an average increase in universal credit of £470. Raising the national living wage will deliver an increase of over £1,800 to the gross annual earnings of someone working full-time on that wage. Uplifting the local housing allowance to the 30th percentile of local rents, as mentioned earlier, will benefit 1.6 million private renters by an average of £800 per year.
The noble Lord, Lord Bird, and the noble Baronesses, Lady Lister and Lady Bennett, asked whether we accepted that a strategy was now needed. I did promise to try to answer this. We have consistently set out a sustainable long-term approach to tackling child poverty, based on evidence about the important role of work in substantially reducing the risk of child poverty. I am very aware of the interest that the noble Lord, Lord Bird, takes in this, and I reassure the House that Ministers continue to work across and beyond departmental boundaries to ensure that we take a co-ordinated approach to supporting vulnerable and low-income households. This includes a cross-government senior officials group on poverty, as well as bilaterals and meetings with external anti-poverty stakeholders. The noble Lord, Lord Shipley, is right that Treasury input to this is vital.
I return to the question of childcare raised by the noble Baroness, Lady Bottomley. She asked what extra support we are providing to parents. The Department for Work and Pensions and the Department for Education work closely together to ensure that there is a comprehensive childcare offer that reflects different family circumstances, covering children over a range of ages.
Earlier, I mentioned some of the problems families in poverty face which mean that they can struggle to move into work and improve their financial circumstances. This Government offer a range of programmes to help people address these complex underlying challenges, so that they can take their first steps towards securing better outcomes for their families.
I applaud my noble friend Lord Effingham for making a number of interesting points. The noble Lord, Lord Shipley, put it well when he said that they were interesting contributions to the debate. I agree with many of the points that he made.
The pupil premium funds schools to help improve educational outcomes and close attainment gaps for disadvantaged children in state-funded schools in England. Funding for this is increasing to over £2.9 billion in the year 2024-25. That is £80 million more than last year.
We are taking significant action to improve children’s health, which is another important point. This includes dramatically reducing sugar in children’s food, investing over £600 million to improve the quality of sport for children, and encouraging healthy diets for lower-income families through schemes such as Healthy Start. We are also investing £2.3 billion a year in mental health services.
The Money and Pensions Service’s UK Strategy for Financial Wellbeing is a 10-year framework to help everyone make the most of their money. It has set out five goals to be achieved by 2030, including to see 2 million more children and young people receiving meaningful financial education.
One example of the support that we are giving is the Supporting Families programme, which is now the responsibility of DfE. This has funded local authorities to help almost 637,000 families experiencing multiple disadvantages to make sustained improvements with their problems.
A network of 300 supporting families employment advisers, specialist DWP work coaches, work with the programme, providing employment support that is helping almost 10,000 families, resulting in around 200 job starts every month.
My noble friend Lady Bottomley mentioned Reducing Parental Conflict. This is very close to my heart—I am directly responsible for it in government—and we have £33 million-worth of funding available from 2022 up until next year, 2025. This programme has enabled local authorities to support couples to address conflict in their relationship, which has helped to deliver positive impacts for children over no less than three major evaluations at the end of last year. We are also looking to see how we can ingrain that in the Child Maintenance Service, which again is my responsibility. I feel very passionate about it, and the work we do, by the way, helps to take 160,000 children out of poverty each year, and there is always more to be done.
The noble Baronesses, Lady Janke and Lady Bennett, spoke about childcare, and I want to give a quick response. The department is aware that, for some universal credit claimants, childcare costs present challenges to entering employment. To support people to become financially resilient by moving into work and progressing in work, eligible UC claimants can claim back up to 85% of their registered childcare costs each month, regardless of the number of hours that they work, compared to 70% in tax credits.
The right reverend Prelate the Bishop of Lincoln is not in his place, and I am not sure why. I think I will write to him rather than answer him when he is not in his place. He asked about rural communities.
I shall conclude, given the hour, by reassuring the House again of the importance we place on this matter. The early years, as I am sure the noble Lord will agree, are vital to securing good outcomes for children, and that is why we continue to work across government to ensure the best start for all children, including through our early years childcare provision and funding for school breakfast clubs. We understand that many families still face challenges, we are not shying away from that, and we will continue to work to ensure that the welfare system supports families who need it. To conclude, with inflation falling towards target and the economy beginning to turn a corner—perhaps green shoots; I do hope so—it is right that we continue to support parents to meet their responsibilities towards their children by seeking employment opportunities wherever that is possible.