Tackling Poverty in the UK

Lord Field of Birkenhead Excerpts

Thursday 10th June 2010 Commons Chamber

[Helen Goodman]

That is absolutely right. It is vital that we prevent the poorest people from being exploited in the way they have been. There is a lot of work to be done on this subject.

[Mr Frank Field (Birkenhead) (Lab)]

Has my hon. Friend had the same experience as I have in my constituency, where the Financial Services Authority is regulating credit unions in the way we wish it had regulated the big banks, thereby putting their future at stake? As my hon. Friend the Member for Alyn and Deeside (Mark Tami) said, credit unions play a vital role in giving poorer people an alternative way of getting cheap credit.

[Helen Goodman]

I do not know whether my experience in my constituency has been exactly the same as that of my right hon. Friend, but he reinforces the significant role that credit unions can play, and we urge the Government to maintain support for them.

--- Later in debate ---

[Helen Goodman]

Of course Members from the coalition parties could be elected in those areas, given that they did not say before the election that they would cut the future jobs fund. They promised that they would continue it, and now they have cut it. That is the problem. I suspect that the Government’s real agenda is to make young people do the same work that they were doing under the future jobs fund, but whereas everybody was paid at least the minimum wage through that fund, under the schemes that the Minister and the Government are proposing they will have to live on benefits. What will that do for poverty levels, and where does it leave the Liberal Democrats’ commitment to raise the minimum wage for people under the age of 24?

It is ironic that the one thing the partners in the coalition really cannot agree about is the role of the family. The Tories want to reintroduce the married couples allowance, but that is one of the few matters on which the coalition agreement allows the Liberal Democrats to abstain. Who will benefit from it? Not the widow, the abandoned mother or the woman who has left her husband because of domestic violence. The Liberal Democrats should have the courage of their convictions, and they should vote against it. It is a wholly regressive and retrograde step. As the Deputy Prime Minister said during the election campaign, it is

“a throwback to the Edwardian era”

and “patronising drivel”.

The Secretary of State, who unfortunately is no longer in his place, revealed on 27 May that he was still looking to the Treasury for an extra £3 billion to reform the benefits system. The coalition agreement states that

“initial investment delivers later savings through lower benefit expenditure…based upon the DEL/AME switch”—

the departmental expenditure limits/annually managed expenditure switch. That is obviously based on the work of the Centre for Social Justice, which we examined in some detail when we took evidence on the Child Poverty Bill. The Secretary of State even seemed to be laying his job on the line later on 27 May when he said that he had not taken the job to be a “cheeseparer”, and stated:

“If somebody tells me I have to do something different then I won’t be here any longer.”

I suspect that the Chancellor of the Exchequer may be telling him to do something different right now, because he says that tackling the deficit is the priority. If Ministers in the Department for Work and Pensions can persuade the Treasury that the extra £3 billion is the goose that will lay the golden egg, we shall be extremely surprised.

A further complication in trying to tease out the Government’s strategy is that No. 10 has appointed my right hon. Friend the Member for Birkenhead (Mr Field). We have not yet seen his terms of reference—I do not know whether they are to think the unthinkable—but there seems to be something strangely familiar about the situation. Last Saturday The Guardian said that he was going to look again at the definition of poverty. That really would be unthinkable. What is the point of it?

[Mr Frank Field]

Will my hon. Friend give way?

[Helen Goodman]

I will, because I would like my right hon. Friend to answer two questions. Is the purpose of moving away from the definition agreed in the European Union and the OECD to tell poor people that they are not really poor, or to avoid future embarrassing comparisons?

[Mr Field]

I am disappointed that my hon. Friend does not know the Labour Government’s record better. If she examines the last publication that we produced, she will see that we said there was a choice of four definitions of poverty. I shall go into them more if I catch your eye later, Mr Deputy Speaker, but that document asked for views on the balance among the four and whether we should add others. By all means let us have a go at each other about this on a personal level, but let us also be clear where the Labour Government left the debate.

[Helen Goodman]

I think my right hon. Friend ignores the fact that it is less than three months since the Child Poverty Act 2010 received Royal Assent. It committed any Government to eradicating child poverty and set out the four measures that will be used to make that judgment, which are of absolute poverty, relative poverty—that is the one agreed in the EU and the OECD—persistent poverty and material deprivation. Everybody in the House supported that Act, and I hope that the Government will not renege on that support.

The main problem with the Government’s position is that it is incoherent. They are divided on family policy and welfare strategy. Everyone knows that worklessness is one of the key drivers of poverty, but the proposals that we have heard from the Government so far will increase unemployment and the north-south divide.

--- Later in debate ---

[Mr Frank Field (Birkenhead) (Lab)]

I am pleased that you were in the Chair when I rose to speak, Mr Deputy Speaker, even though you are about to leave the Chamber, because I can add my congratulations to those of others. It is a particular pleasure to see someone from the north-west in the Chair.

As the debate is rightly dominated by maiden speeches, I wanted to comment on how I felt more than three decades ago when I made my maiden speech, but from what I have experienced in this debate, my recollections will be irrelevant. For days, my insides were chewed up with nerves because I was worrying about making that maiden speech. The good news that I thought I would be bringing to Members making their maiden speech today is that it does not get any better. However, I can see from their performance that their confidence and the quality of their contributions far exceeds that of the intake of 1979.

I am grateful for the chance to contribute to this wide-ranging debate on poverty. I hope the House will forgive me if I focus narrowly on part of the canvas rather than addressing some of the wider aspects that Members have already touched on. A starting point for me is our debate on the Child Poverty Bill before the last election, when I expressed both admiration for what the Government had done and a sense of worry about where we would go from that position of relative success.

If we cast our mind back to the then Prime Minister’s objective to abolish child poverty by 2020, we can only exclaim that it was one of the most audacious targets set by any Government. I happened to be a Work and Pensions Minister at the time, and I learned about the target for the first time when I went into my room at the Department and saw Sky News on the television. That is when I learned that the Government’s objective was to abolish child poverty by 2020, even though I was a Minister with some responsibility for it. Others will have shared my sense of awe about how decisions came down to us—lesser Members—from Mount Sinai.

Had I been consulted beforehand, I hope I would have advised the then Prime Minister that although we should commit ourselves to the objective, the formula was one that no other country in the free world had achieved. We should not set targets for people, nations or Governments to fail; we should set targets they can achieve. It was thus immensely important before we fought the general election that we not only set out attempts to broaden our understanding of how we might measure poverty but put them in an Act of Parliament. That process is being developed and possibly taken a stage further in the review that the Prime Minister has asked me to undertake.

It gives me considerable pleasure that I have been asked to carry out the review, but it would have given me even more pleasure had my own side asked me to undertake that activity. The terms of reference took some time to agree—about seven times as long as the coalition agreement. They are public—they are certainly on my website—and I shall set out what I hope the review will achieve by Christmas.

In interviews, I have cited just one study, although there are many others that we could cite from our constituencies. The study relates to the work of the Prince’s charities in Burnley. It is a wonderful project, where volunteer mothers make sure that children are up in time for school. The children are taken to school. If need be, they are washed at school, fed breakfast and made ready, with all the other children, to start their day’s activities and endeavours.

My plea to the House is that if anyone thinks that those projects will be made irrelevant simply because we increase household incomes, however necessary basic income is, they are doing a disservice to poorer families and to the poor generally. Indeed, one of the great purposes of the review, if it fulfils its ambitions, is not only to run alongside the monetary definitions of poverty considerations of what non-financial aspects push children into poverty but, more importantly, to move the debate on. Until now, it has been obsessed with inputs—what we put in, and how much money is at stake, crucial though that is—and we need to consider outcomes. Therefore, part of the review will consider how we can together construct an index of what determines children’s life chances, how we can extend those life chances and, more importantly, how we can measure that, so that we can report back to our constituents on whether we have been successful during each Parliament.

[Helen Goodman]

I should like my right hon. Friend to be specific. I am not sure whether we were at cross-purposes earlier. My concern is that we do not redefine the poverty level. That is the major concern among Labour Members. We should not say, “Oh, 60% of median income is far too high. We want to go to 40%.” I draw his attention to the full definition that we put in the Child Poverty Act 2010. We now take into account a wide range of things: outdoor space in which to play, celebrations on holiday and at Christmas and swimming at least once a month. Those items are under a continual process of renewal, because that index is based on surveys of the whole population and what the whole population thinks it is reasonable for a child to have.

[Mr Field]

I am happy to give assurances to my hon. Friend. The law is quite clear about the objectives. I have no idea what the report will contain, but those objectives that we have are ones that we should achieve. The primary definition that we used before the 2010 Act was not only difficult to achieve mathematically, but has not been achieved in any country in the free world—hence we asked in the document that we published whether we should use an average of those countries that do best in achieving that definition in setting our target.

Time is scarce, and I obviously do not want to be delayed by a narrowly focused, technical debate on definitions—I hope there will be plenty of time for that—but my hon. Friend says that other aspects of the 2010 Act that are used to define poverty are important. Of course they are important, but I want to focus much more clearly on pathways out of poverty and on increasing life chances. I hope that those Members of Parliament who have views—they clearly have, given today’s maiden speeches—that will add to that side of the review, as well as to the debate on the technical definition of poverty, will contribute to the review.

[Chris Williamson (Derby North) (Lab)]

Does my right hon. Friend agree that measures such as the future jobs fund, tax credits and the increase in child benefit provide an important pathway out of poverty? I hope that he will touch on that—I see from his notes that he might—because I am very concerned about the coalition Government’s proposals to undermine those schemes.

[Mr Field]

If my hon. Friend had really good sight, he would be able to see that No. 3 on my extensive notes is the jobs fund.

There will be two tasks for Opposition Members as the Government begin the necessary task of reducing public spending towards the level of what people in this country are prepared to pay in taxes. We will no doubt have a rigorous debate, but even when the details are decided, I hope that stage 2 will be to argue whether any cuts are being made in the right areas. My plea to Ministers is that they look most carefully at their choice of making initial cuts to the new deal jobs fund programme. When I sat on the other side of the House, I was clear in my criticisms of the new deal. One has only to look at the outcomes regarding levels of unemployment, levels of NEETs—those not in education, employment or training—and levels of retreads to conclude that that huge area of expenditure clearly needs to be examined.

The one thing that I hoped we would do in our first year in office—we got round to it only towards the end of our time—was to ensure that we could give some job guarantees to our constituents, including our younger constituents. That is important for two main reasons, the first of which is that, as we all know from our constituencies, many people try desperately hard to get jobs yet fail to do so, and the cumulative effect of that failure has an enormously crushing effect on them. The jobs fund was beginning to offer concrete jobs for people to go to, and that was a lifeline that had never been offered by any amount of new deal, any amount of retreading the new deal, or any amount of rhetoric from our side. The fund was one of the most precious things with which the previous Government were involved.

The second reason why the scheme was valuable was because we all have individuals in our constituencies, especially young lads, with no intention of working, although this is not the time for us to delve deeper into why that is so. If we are telling people that their benefits will be time-limited, cut or ended, we will carry the electorate with us only if we can definitely offer someone a job. Those young lads who have worked out how to fiddle the new deal and know that, if they turn up in a certain state, no employer in their right mind would ever give them the job on offer will know that it is decision time for them if, through the jobs fund, we can guarantee to offer them jobs irrespective of how they turn up. As I said, the fund was one of the most precious initiatives that the Labour Government introduced, so although I am not arguing with Ministers against their cuts, I ask them to think differently about how the cuts are distributed among people on benefits whom we would hope would be seeking work.

I am grateful for being called to speak, and I am even more grateful for the interventions because they have given me a bit of extra time. I look forward to hon. Members’ contributions to both this debate and the review.