Poverty

Lord Freud Excerpts

Wednesday 29th June 2016 Lords Chamber

[Lord Bird]

To ask Her Majesty’s Government what long-term plans they have, and what action they intend to take in this Parliament, to prevent the underlying causes of poverty in the United Kingdom.

[The Minister of State, Department for Work and Pensions (Lord Freud) (Con)]

The Government have set out a new life chances approach which will include a set of indicators to measure progress in tackling the root causes of poverty, such as worklessness, educational attainment and family stability.

[Lord Bird (CB)]

My Lords, I think I may go down in history as the person who asked only one question of this House—how do we begin the process of dismantling poverty? When we have a situation where 34% of all the money received by the Chancellor of the Exchequer is spent on and around poverty; when we spend 12% of our budget on education and yet we fail 30% of our children in school, who then become 70% of the prison population, who then become 50% of the people who use A&E as a drop-in place, when will the Government and the House get behind the idea that we need a different form of intervention in poverty in order to begin to dismantle it? We are pussyfooting around. We are not dismantling poverty in the way that it should be done. Let us be honest and accept that keeping people in poverty is incredibly expensive.

[Lord Freud]

We are trying to move away from the income transfer approaches that we have seen for some time, to try to handle the fundamental causes of poverty. I agree with the noble Lord that that is where the effort has got to go. It is difficult, but that is the only real way to tackle this problem.

[Lord Morris of Handsworth (Lab)]

My Lords, does the Minister agree that one measure of national poverty is the number of people using food banks? Can he therefore provide a report to this House saying whether that number has gone up or down since the general election?

[Lord Freud]

We do not collect those figures. There have been figures: I believe that the Trussell Trust put out some not so long ago, which showed those figures, from its perspective, flattening out. There has also been quite a lot of research on food banks, and the APPG did a very good piece of work, which showed that what drives people to this emergency support provided by the community—which one welcomes—is a very complex matter.

[Baroness Manzoor (LD)]

My Lords, no one chooses to be poor, but of course there are many people in the UK who experience poverty. We are moving into a global era when there is greater emphasis on technology, automation and robotics, and we need to upskill our workforce. What is the Government’s strategy to ensure that those who are trapped in poverty are given the skills needed to be able to contribute in that area? As we move forward, the gap between those who have and those who have not will get greater.

[Lord Freud]

There is a huge amount of work being done on the educational side, which is where this has to start—but clearly there is an element of remediation and later support beyond the school years. That is where, for instance, the apprenticeship programme, which is growing quite steeply, is really important.

[Lord Shinkwin (Con)]

My Lords, as someone who welcomes the Prime Minister’s commitment to social justice and improving life chances, and believes that he will leave a significant legacy to his successor, may I ask my noble friend what plans the Government have to help the most needy and vulnerable benefit recipients in future?

[Lord Freud]

One of the most valuable things I got from this House was during the passage of the Welfare Reform Act 2012, when we debated what to do for the most vulnerable in the context of UC. That led to the creation of universal support, whereby we join up with local authorities to try to provide services that join together. We have done that now for two of the barriers people face, in budgeting and in digital competence, and we are now exploring how to expand that approach, which shares information, data and support in relation to other barriers. We have some trials going on at the moment, one in Croydon and one in the London Bridge area, on how to do that most effectively.

[Lord Sutherland of Houndwood (CB)]

My Lords, one of the Government’s more successful innovations in dealing with the long-term implications of poverty has been the introduction of the pupil premium. I have to tell the Minister, from conversations I have had with headmasters in some of the most benefited schools in this area, that they are concerned that changes in the rules about how entitlement to benefit is calculated in future will affect very directly the input into schools through this rather good innovation. Any reassurances that can be given, now or in writing, would be appreciated.

[Lord Freud]

That is one of the topics that I and the Schools Minister are talking about. We now have, as a potential option for future use, far more specific measures of real levels of poverty in universal credit which we can use to record poverty, rather than the much cruder measures that we used in the legacy system.

[Baroness Sherlock (Lab)]

My Lords, if the Minister wants to measure poverty he could perhaps look at the official figures that came out this week. They show that while average household incomes are finally back to their pre-crash levels, child poverty has actually gone up by 200,000. It is the first rise for a decade, the largest single rise in one year since 1996, and even more of those poor kids are in working families. Ministers were warned by people around this House that this would be a consequence of government policy but the Minister kept telling us that we were crying wolf. I have rarely been sorrier to be wrong. But now that the warning signs are clear, what will the Government do about it? We have not yet had the effect of the cut in universal credit help or benefits for large families. Will he please urge his new Secretary of State, if he genuinely wants a one-nation country, to go back and reverse that catastrophic decision to cut help for working families on universal credit?

[Lord Freud]

Regrettably, the cry of wolf is wrong in this case. As the noble Baroness knows perfectly well, these statistics are fairly odd on a year-by-year basis. We have had quite a substantial rise in the median income, so the relative figure has gone down—although, I am told, it is genuinely not statistically significant. At the same time, there has been a decline in the number of children living in absolute poverty, with 100,000 fewer. These figures can be pretty odd, and this is another good example of it.