Child Poverty in the UK (Target for Reduction) Bill

Lyn Brown Excerpts

2nd reading: House of Commons
Friday 3rd February 2017 Commons Chamber

[Lyn Brown (West Ham) (Lab)]

Does my hon. Friend agree that if someone does not meet their targets, they should change their actions, not their targets?

[Dan Jarvis]

My hon. Friend speaks with real authority on this matter, which I know is very important to her personally. I agree with her, and let us be clear: this House has previously united behind that principle, most notably in enacting the Child Poverty Act 2010.

--- Later in debate ---

[Dan Jarvis]

The hon. Lady is right. So far I have been outlining the moral case for action on poverty, but I think there is a sound economic case for it as well. We should recognise that that focus is necessary if we are to build an economy that works for everyone. Action on child poverty today can strengthen our economy, improve productivity, and reduce pressures on the public purse. Both the International Monetary Fund and the OECD have emphasised that poverty acts as a drag on economic growth. Reducing poverty will strengthen our economy, not least because the less well-off households spend more of the money that they receive than those that are better off.

When we hear about those who are, as Prime Minister described them, just about managing, we must all seek to understand the reality of those people’s lives. Many families are just one bill away from finding themselves struggling. Those families have been feeling the squeeze for years: 50% of households have received no meaningful pay increase since 2005. Over the last decade, real earnings have fallen by more than 10%, which, as the TUC has pointed out, leaves the United Kingdom at the bottom of a league table of OECD nations, equal only with Greece. This has been the longest pay squeeze for more than a century.

Poverty also increases demand on the public purse. It is responsible for £1 in every £5 of public spending. To put it simply, poverty will make it even harder to balance the books in the future.

[Lyn Brown]

Poverty is not just about “now”. Poverty among children creates conditions in which they will not thrive in the future, and in the future it will cost us more to deal with the poverty that our children are experiencing today. Food, education, prosperity and health all involve costs.

[Dan Jarvis]

My hon. Friend is absolutely right. We need to invest in our future as a country.

The Joseph Rowntree Foundation estimates, on the basis of its research, that the annual cost of poverty to the public purse comes to £78 billion. That is why it is penny wise but pound foolish to cut investment in early years intervention.