Welfare Reform and Work Bill

Lord Liddle Excerpts

Wednesday 9th December 2015 Lords Chamber

We need to change these measures to ensure that government has to wrestle with what really drives poverty and takes steps to ensure that the next generation has a better chance than the current generation. It is easy to give the family of an addict another £100 a week—government is good at that—but these are serious measures to ensure that Governments place their money and their investment in significantly harder, but in the long-term more effective, interventions.

[Lord Liddle (Lab)]

My Lords, I had not intended to speak in this debate. I am no social security expert, but I did have quite a lot to do with these issues when I worked in 10 Downing Street as Tony Blair’s Europe adviser. My intervention was prompted by what my noble friend Lady Blackstone said.

It is not very popular today to talk about the admirable things that new Labour did, but I am certainly happy to do so. In 1997, we inherited a situation where, I think, 25% of children were living in poverty. That was the new Labour inheritance. It was the result of de-industrialisation, the downgrading of social security and all that had happened in the Thatcher years. We did not run away from the fact that 25% of children were living in poverty; we tried to do something about it. What is more, as members of the European Union, we were very happy to measure ourselves against the performance of other members of the European Union on the score of tackling poverty and social exclusion.

Actually, Britain’s record in this area is pretty deplorable and, I am afraid to say, still is not very good. One of the things we did was support a comprehensive set of indicators that was devised to measure poverty and social exclusion. This was done by a working group under the leadership of probably the most distinguished economic statistician of his generation, Sir Tony Atkinson. We were glad to see this comprehensive set of measures, including the standard measures of child poverty and lots of other measures of social inclusion, because we wanted to learn from the experience of other countries about how best to try to tackle the deeply embedded problem of child poverty.

It seems to me now that the Conservative Government appear to be trying to treat Britain, as it were, as a special case. They no longer want to see Britain compared to other countries on the standard measures. They want to devise their own measures in relation to what they think matters. This is deplorable because all of us in this House ought to share those ambitions and we all ought to be able to see how we are doing in relation to other countries and learn from the experience of other countries.

The second point I will make about what I remember from 20 years ago is that when we came in, I was certainly very convinced by the argument that the best answer to poverty was a job. I think that the noble Baroness, Lady Stroud, shares that view. There is a lot of truth in that proposition, but as time has gone on and we have seen how polarisation in our labour market has increased—and it has increased dramatically in the last two decades—and we have seen the spread of low-paid and insecure work, it is much more the case now than it was 10 or 20 years ago that people can be in poverty and have a job at the same time. That is why I thought that the speeches made about the importance of measuring in-work poverty were so right. This is a problem of our times: it has become a much more serious problem, and if we try to turn our back on it, we will betray the cause of a more socially just society.

[The Lord Bishop of Durham]

My Lords, I will speak in support of Amendments 24, 25 and 26. I know that everyone in this House, and indeed in the other place, is committed to protecting those children in our society who are vulnerable to suffering the worst effects of poverty. Indeed, I know that there is a broad recognition across the House that some form of statutory reporting on the issues of child poverty and children’s life chances is an important tool in driving initiatives that will combat that poverty. The questions about what should be included in Clause 4 are questions of best practice, rather than questions of best intention.

I welcome the Government’s commitment to tackling the disadvantage that can arise from worklessness and poor educational attainment. It is certainly true that children growing up in long-term workless households are placed at a significant disadvantage to their peers when it comes to their future working lives, as are those who leave school with low educational attainment. A thorough reporting on these indicators should help drive initiatives to combat these two factors, which can be so detrimental to the life chances of children. I welcome the Government’s focus on these two priorities.

However, it is my belief—and the belief of the vast majority of organisations working in this area, as we have already heard—that measuring workless households and educational attainment alone is insufficient as a method of measuring a child’s life chances and exposure to poverty. There are, of course, all sorts of other factors that can influence the future prospects of children: problem debt, substance abuse, family breakdown and substandard housing. The list of life-chance indicators should be extended to include these. We also know that children’s life chances are shaped very early on in their lives, so we need to be looking at cognitive and social development at a younger age.

Most significantly, however, the current set of life-chance indicators completely fails to capture income poverty and material deprivation, particularly in relation to in-work poverty. I think that we have to keep on repeating this: some 64% of the children defined as living in poverty under the current measures are in working households. This should give us cause to stop and think about how effective these new measures will be when no assessment of in-work poverty is facilitated. It is particularly problematic given the well-established body of evidence demonstrating the strong link between material deprivation and the wider life chances of the child.

The Government talk confidently about focusing on the root causes of poverty rather than the symptoms, but I think that the reality is a little more chicken and egg than perhaps they would like to admit. Let us take as an example educational attainment. Does poor educational attainment make it more likely that children will experience poverty and deprivation in later life? Yes, of course it does, but income poverty and deprivation also make it far more likely that children will do less well at school, lacking the resources they require to compete with their peers on an even footing.

As it stands, Clause 4 is inadequate. In the right desire to move away from an overly simplistic definition of child poverty rooted in money alone to a broader-based, root-cause understanding, I fear that a tap-root cause is being lopped off, and that will make the other roots less stable. We all know that if you take out the tap-root, the danger is that the whole tree will fall. We must retain some assessment of income poverty, and particularly in-work poverty, in the life-chances measures. Given that at Second Reading the Minister, the noble Lord, Lord Freud, committed the Government to the continued publication of the HBAI measures that are currently enshrined within the Child Poverty Act 2010, it seems odd that the Government are so reluctant to include those measures on a statutory basis in this Bill, which would cost almost nothing. I and most organisations working in the area of child poverty would like to see this happen. At the very least, a report of in-work poverty that draws on those figures must be included within the reporting obligations, as has been suggested by the noble Baroness, Lady Lister. A failure to report on in-work poverty would be a real failure by a Government who have prided themselves on combating low pay and making work pay.