Child Poverty

Lord German Excerpts

Wednesday 8th July 2015 Lords Chamber

[Lord Freud]

The HBAI measure will clearly still be published and is a useful measure to track what is actually happening. It is, however, a very poor measure as a statutory target because it is simply not forecastable. I come back to the point about the so-called cuts for those in work. After today’s Budget, by 2017-18, eight out of 10 working households will be better off as a result of the combination of personal allowances, the new national living wage, which will rise to £9, and the welfare changes. That is 17.7 million households better off.

[Lord German (LD)]

My Lords, a policy that reduces the number of children in poverty when the economy is on the way down yet actually increases it when the economy is on the way up is surely a nonsense. You can never eradicate child poverty under that measure. But surely household income and knowing the circumstances in which children live is a very important measure in determining whether they are in poverty. Will the Minister agree to the Government including household income as a factor in whatever child poverty measure they use in the future?

[Lord Freud]

We will clearly go on reporting on the HBAI measure. As a legal target it is very dangerous, and we have just seen why. In 2011, the IFS projected a figure which was wrong by 5 million children. The IFS thought that there would be 5 million more children in 2013-14 than there actually were when the figures came out. If it is a legal target, you have to start working to reduce your poverty by 5 million children—sorry, half a million children, not 5 million. That is completely unforecastable and implies huge unnecessary costs on the state.