Coalition must not destroy legacy of lowest child poverty for 25 years

Tim Nichols, of the Child Poverty Action Group, looks at the policies brought in under Labour thast helped bring child poverty down to the lowest levels for 25 years.

Tim Nichols is the Press and Parliamentary Officer of the Child Poverty Action Group

The coalition government has argued for an approach to ending child poverty that is not simply about moving a few families over an arbitrary line. They want a strategy that is about making work pay, rather than income transfers, or “poverty plus a pound” as Nick Clegg often puts it in his dismissive soundbite.

But the new child poverty figures out yesterday present a problem for the government’s analysis and strategy.

Not only do they show a fall of 200,000 in the number of children in poverty – bringing the figure, measured before housing costs, to its lowest level in 25 years – but they also show a reduction of 100,000 in the coalition’s new measure of material deprivation combined with severe relative low income (below 50 per cent median income).

It had been predicted that any fall in poverty for 2009/10 would be largely a consequence of a fall in median income following the recession. The headline poverty mark is 60 per cent median income, so if median income falls, so does the poverty line, leaving some people who were just below it now just above it. But median income actually rose slightly.

Therefore we can only really attribute the fall in child poverty to three key investments the previous government made in families from April 2009:

• A rise in child benefit for the oldest child to £20;

• A £50 annual rise in child tax credit above indexing;

• The introduction of a child benefit disregard in housing benefit and council tax benefit, so that working families on low income got more help with their rent and council tax.

This strategy, combining universal benefits, income transfers, housing support and tax rebates, was of course working in parallel with other elements of a broad strategy on child poverty, such as a decade of growing investment in Sure Start centres. Clearly, it was working.

Not only was relative poverty impacted, but also so was severe poverty and material deprivation. This is not just a paper exercise of children moving over an arbitrary line, the evidence clearly shows a real impact on the lives and wellbeing of children affected by socioeconomic disadvantage.

But all this progress is now under threat. The Institute for Fiscal Studies (IFS) has predicted that, as a consequence of the coalition’s programme of cuts, especially cuts to family welfare, child poverty will begin to rise again.

See the table below:

  Millions % of children

Baseline year: 1998/99

3.4

26%
Latest figures: 2009/10 2.6 20%
IFS estimate: 2010/11 2.5
IFS estimate: 2013/14 2.7
Coalition’s 2020 target Below 10%

Sources: HBAI 1998/99-2009/10 (rounded figures before housing costs); Children and Working-Age poverty from 2010 to 2013, IFS 2010

Many of the coalition’s cuts run directly counter to ministers’ stated priorities of making work pay and increasing work incentives. Tax credits and support to help meet childcare costs are suffering the swing of the axe from chancellor George Osborne and his Liberal Democratic deputy, Danny Alexander, while Iain Duncan Smith’s much vaunted Universal Credit is also being hobbled by the Treasury.

The work incentives that his Centre for Social Justice calculate are needed are now being wrecked by a refusal from the Treasury to fund the scheme at the level needed. Meanwhile Eric Pickles at the Department for Communities and Local Government is throwing another spanner in the works by insisting Council Tax Benefit is replaced by a complicated plethora of local schemes, turning the transparent work incentives that were intended into a postcode lottery for many claimants.

David Cameron made a great promise when he was seeking election to 10 Downing Street, saying in 2007:

“We can make British poverty history, and we will make British poverty history.”

But with the deputy prime minster taking the lead, the drive for progress on poverty has been lost due to his dismissal of adequate incomes today in favour of a focus on ‘life chances’ for tomorrow. It is time the coalition left behind the deputy prime minster’s vague rhetoric and got back in touch with the prime minster’s ambition.

The evidence base clearly dictates the kind of policies that successfully impact on children’s lives and wellbeing today. If the progress achieved – despite the awful economic circumstances – in the final year of the previous government were to be replicated throughout a full five-year term of the coalition government, there would be a million fewer children in poverty by the next election.

Only this concrete progress will change life chances for the next generation.

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34 Responses to “Coalition must not destroy legacy of lowest child poverty for 25 years”

  1. Hans Guntersson

    RT @leftfootfwd: Coalition must not destroy legacy of lowest child poverty for 25 years: http://bit.ly/kpzZTb writes Tim Nichols

  2. Altany

    RT @leftfootfwd: Coalition must not destroy legacy of lowest child poverty for 25 years: http://bit.ly/kpzZTb writes Tim Nichols

  3. Marie J

    RT @leftfootfwd: Coalition must not destroy legacy of lowest child poverty for 25 years: http://bit.ly/kpzZTb writes Tim Nichols

  4. Violet Greaves

    RT @leftfootfwd: Coalition must not destroy legacy of lowest child poverty for 25 years: http://bit.ly/kpzZTb writes Tim Nichols

  5. jennifer roberts

    RT @leftfootfwd: Coalition must not destroy legacy of lowest child poverty for 25 years: http://bit.ly/kpzZTb writes Tim Nichols

  6. Extradition Game

    RT @leftfootfwd: Coalition must not destroy legacy of lowest child poverty for 25 years: http://bit.ly/kpzZTb writes Tim Nichols

  7. Michael

    Coalition must not destroy legacy of lowest child poverty for 25 years – http://j.mp/jXLpVZ – I fear they will.

  8. jennifer roberts

    RT @TheRightArticle: Coalition must not destroy legacy of lowest child poverty for 25 years – http://j.mp/jXLpVZ – I fear they will.

  9. Len Arthur

    RT @leftfootfwd: Coalition must not destroy legacy of lowest child poverty for 25 years: http://bit.ly/kpzZTb writes Tim Nichols

  10. Michael Carr

    RT @leftfootfwd: Coalition must not destroy legacy of lowest child poverty for 25 years: http://bit.ly/kpzZTb writes Tim Nichols

  11. Murray Rothbard

    Child Poverty is a socialist contrivance designed to promote income redistribution. It has nothing to do with the poverty of children at all. How about a bit of honesty for a change.
    http://www.libertarianview.co.uk/the-oecd-%E2%80%9Cchild-poverty%E2%80%9D-and-socialist-double-speak/

  12. paurina

    RT @TheRightArticle: Coalition must not destroy legacy of lowest child poverty for 25 years – http://j.mp/jXLpVZ – I fear they will.

  13. Anon E Mouse

    Murray Rothbard – Absolutely agree. Perhaps if the gap between the rich and the poor hadn’t increased under Labour it would be better.

    Also the stupid socialist dinosaurs influencing Labour mean the party agrees that child benefits should be given across the board – even to multi millionaires.

    I’ve said it before but Labour believe it is right for the nightshift minimum wage shelf stacker at Tesco pay a proportion of his wages to give that money to Eric Clapton, a multi millionaire who earns £500 000 an hour playing the guitar at night.

    It stinks. It’s unfair. It hurts the poor and Labour support it. This article is nothing more than socialist spin from someone trying to justify his non job.

    When will Labour realise we don’t but their spin and lies? We didn’t before the general election and we don’t now…

  14. 13eastie

    Child poverty was Brown’s very own hobby-horse, and evidence of success on this front is appositely as easy to find as rocking-horse dung: targets were missed consistently throughout the last decade. And then abandoned altogether.

    UNICEF voted the UK the worst developed country in the world in which to raise children in 2007.

    And it was the CPAG itself that, in 2009, after twelve years of Labour maleficence, named the UK as one of the worst in Europe at looking after its children, saying, “we need a frank focus on why other countries are doing so much better for their children”.

    http://news.bbc.co.uk/1/hi/uk/6359363.stm
    http://www.cpag.org.uk/press/2009/210409.htm

    Labour’s record was shameful.

    By choosing to focus solely on a metric that is based more on how the nation’s millionaires are faring than on anything that actually happens to children, Labour shirked its responsibilities and supervised the institution and maintenance of many societal determinants of child distress: marriage and stable family life persistently undermined statutorily, in common law and through a benefits system that punishes parents who face up to their responsibilities; escalating teenaged pregnancies; workless “families” positively encouraged; rampant gun and knife crime; rising drug and alcohol abuse.

    If, as you claim, “it was working”, why did the UN and your own CPAG disagree so vehemently?

    If you have kids, you will know they fast they are to spot a charlatan.

    The kids don’t buy Labour’s spin.

  15. LESPN

    Coalition must not destroy legacy of lowest child poverty for 25 years http://ow.ly/1cDRfa

  16. Ash

    ‘They want a strategy that is about making work pay, rather than income transfers, or “poverty plus a pound” as Nick Clegg often puts it in his dismissive soundbite’

    This remark makes me about as angry as anything the insufferable, sactimonious prick has ever come out with.

    I well remember moving from the dole into employment under the Tories in 1996. All of my family’s housing benefit and council tax benefit was withdrawn immediately, and we didn’t qualify for Family Credit because my net income, at £769 a month, was too high. (I was supporting a wife and two children on that.) By the time I’d paid for a train ticket to work, we were worse off than we’d been on benefits.

    Then tax credits came in. They were worth more than £4000 a year to my family. £4000 a year! Not only were we lifted out of poverty, but we could actually think for the first time about saving up a deposit for a house, taking an annual holiday, signing the kids up for sports clubs etc.

    ‘Poverty plus a pound’ my arse.

    (Oh, and worth adding: if Labour has chosen to spend £15 billion or so on ‘lifting the poor out of tax’ by raising the tax threshold, rather than on tax credits, low-income families like mine would have been a few *hundred* pounds better off rather than a few thousand. Most of the money would have gone to people with household incomes two, or four, or six times higher than ours. Which is exactly what’s happening now, of course.)

  17. Ash

    Sorry, should be “if Labour *had* chosen…” in that last paragraph above.

  18. Anon E Mouse

    Ash – I’m sure you’ll agree then that whilst the £4000 was a lifesaver for you it makes no difference to Eric Clapton who’s worth £millions and that the money should be given to those in need and not wasted on multi millionaires.

    I can feel a shared position with coming on… its going to be good…

    So Ash. Do you think it’s fair for minimum wage workers to give their money to pay to millionaires?

  19. scandalousbill

    Anon,

    I am not quite sure if your argument holds. Unless you can show that Clapton is a tax evader, it would seem that he would make a larger contribution than a minimum wage worker. It could also be argued that the cost to the minimum wage worker would increase without this type of larger contributions.
    Or are you advocating that if an individual can afford a privately funded service, they should not be required to pay for a publicly funded one.

  20. Tim Nichols

    @Murray Rothbard and Anon E Mouse
    The word poverty has been used for both absolute and relative meanings for hundreds of years and dictionaries record this usage. This is just pedantry. Whether we label it ‘poverty’ or not is neither here nor there. The main qustion is: ‘is there a problem here?’ Your real criticism therefore seems to be that you don’t see inequality as a problem, or the kind of consequences it brings to the UK as anything to worry about. You are of course entitled to this view, but many other people do not want the kind of segregated society created by the high level of inequality we experience in the UK; nor do they think it is fair that the poorest children have life expectancies over a decade shorter than the wealthiest, are twice as likely to acquire a disability, and are much less likely to reach their full potential in schooling and the acquisition of skills and qualifications.

    If the article is socialist spin, then there must be a lot more socialists around than care to admit it, including David Cameron and the IFS.

    Child Benefit has always worked in tandem with progressive taxation. Yes, Eric Clapton may get child benefit, but he pays much more in tax than a minimum wage worker. Universal child benefit has many advantages, including high take up and ensuring that within household budgets sufficent resources are spent on childrens needs. Means testing child benefit would lose many of the advantages and cost the taxpayer more due to double means-testing, which requires double the bureaucracy. Means testing through income tax is simple and efficient. Why make the taxpayer pay for thousands more bureaucrats through double means-testing bureacracy?

    @13eastie
    It was during the 1980s that rates of both lone parents and workless families rose steeply, so it’s rather weird to blame a government that came in after that change had happened.

    CPAG has indeed been critical of the Labour government’s child poverty record. They could and should have done more. As we have said many times on this point, the glass is half full. You may only want to look at the emply half of the glass, but it is important that we recognise and understand both. We need to appreiciate the progress that was achieved, and how it was achieved, as well as understanding why the greater progress hoped for was not realised.

  21. Anon E Mouse

    scandalousbill – The point I’m making is that benefits should be just that. A benefit based on need and not on lack of need just to try to force state control on the people.

    Millionaires shouldn’t get benefits because they don’t need them and thanks to Labour’s financial incompetence we don’t have the money. People retired overseas shouldn’t get Winter fuel payments either. The Queen shouldn’t have a bus pass.

    Realising that socialism has been rejected in every single country it has been tried – basically it is universally hated so the daft elements of the left in this country try to wangle it in via things like universal benefits.

    Whilst I accept that unlike the Guardian Newspaper Eric Clapton isn’t a tax evader, he doesn’t need child benefit so shouldn’t get it. Those with the broadest shoulders should carry the most weight I say.

    Funnily enough looking after the poor seems to be something no longer considered by Labour in this country…

  22. Anon E Mouse

    Tim Nichols – Please don’t make claims about me that are incorrect. My first sentence reads: “Perhaps if the gap between the rich and the poor hadn’t increased under Labour it would be better”.

    Your comment about double means-testing bureaucracy is nonsense and is just an excuse for your socialist leanings Tim. Or have you now renamed them as your “progressive” leanings?

    All that happens is the tax system is used to calculate benefits which are paid automatically based on need. Using my system the whole thing actually costs less than it does currently for one set of means testing. To suggest that it costs the figure I used, £4000 to tell the state that Eric Clapton doesn’t need that money is also unbelievable.

    You say it isn’t a socialist agenda Tim so perhaps you’ll confirm that in keeping with the rest of the country socialism, like “progressiveism”, has been resoundingly rejected and you’ll have no part of it. Assuming you want the return of a Labour government…

  23. scandalousbill

    Murray Rothbard,

    “You say:

    Child Poverty is a socialist contrivance designed to promote income redistribution. It has nothing to do with the poverty of children at all.”

    You base this on your referenced “analysis” that notes the following premise taken from the OECD, which you say is, “how the OECD define child poverty”, i.e. :
    “A child living in a home with less than half the median disposable income”

    You further maintain, “”You will see immediately, that this is not a measure of child poverty, it is a poorly disguised measure of income equality.”

    The mistake is yours. The OECD note the 50% of median disposable income as a threshold of, not the definition of, child poverty. A quick look at their child poverty database easily illustrates this point

    http://www.oecd.org/els/social/family/database

    Using your alleged definition in place of theirs, would be about as accurate and fruitful as attempting to observe atoms through a set of binoculars.

  24. Ash

    Anon –

    “Millionaires shouldn’t get benefits because they don’t need them”

    Does this also apply to the state pension (a universal benefit very similar to Child Benefit, which I guess could be described as a “young age pension”)?

    How about *services* not needed by millionaires – e.g. the NHS, state education? Should we restrict access to these to people who really need them?

    If not, why not? Why doesn’t your argument regarding Child Benefit apply equally to other currently-universal benefits and services?

  25. scandalousbill

    Anon,

    You say:

    “The point I’m making is that benefits should be just that. A benefit based on need and not on lack of need just to try to force state control on the people.”

    So, if for example, you are in an auto accident and taken to A&E for treatment, this somehow infringes on your right to have a faith healer?

  26. Anon E Mouse

    Ash – And here’s me thinking that we were about to have a unique moment – standing shoulder to shoulder nodding together in agreement…. ah well…

    You’ve introduced “services” which is a whole other topic I’m afraid.

    State Pension – Means test it. Schooling should be a choice.

    But we are discussing directly paid benefits and you seem to be ignoring me which really hurts Ash. (A one word answer is fine). The emphisis here is on the word ‘fair’ btw…

    “Do you think it’s fair for minimum wage workers to give their money to pay to millionaires?”

  27. Anon E Mouse

    scandalousbill – You’re being daft now. Same question as to Ash:

    “Do you think it’s fair for minimum wage workers to give their money to pay to millionaires?”

  28. Ash

    Anon –

    All right then, here’s your answer:

    No, it is not fair for minimum wage workers to give their money to pay to millionaires. The full cost of any benefit paid to millionaires should therefore be clawed back, in full, via the tax system.

    In fact, I’d go further: we should collect *more* in taxes from millionaires than the value of any benefits paid to them, so that they can subsidise the payment of benefits to those who are less well-off. It’s fair, in my view, for millionaires to give their money to pay for minimum wage workers.

    Which is exactly how things work at the moment, of course.

    By the way: I can’t help but chuckle that on pensions, you’re sympathetic to extending Labour’s means-testing approach, while I’m sympathetic to the coalition’s universal-benefit approach. Now there’s a turn-up.

  29. Anon E Mouse

    Ash – Agreed.

    Have a good weekend dude…

  30. Tim Nichols

    @Anon E Mouse

    Sorry I get a bit lost with banter about socialist this and capitalist that. You’d do better to argue that stuff with people who are into it rather than me.

    But on inequality, the IFS report this morning clearly shows that the rate of inequality growth produced by the economic restructuring of the 1980s was significantly mitigated by the Blair and Brown governments’ policies (albeit not reversed, which I agree is a shame). IFS said today that the gini coefficient for UK would be 0.03 higher had Blair retained the policies and economic structures of the previous administration. Let’s hope the Coalition does even better than Blair and actually reduces inequality back to what it was before the 1980s.

  31. scandalousbill

    Anon,

    If these millionaires contribute their fair share via a progressive taxation system, yes. I agree with Ash that redistributive measures should be a part of the progressive taxation system. However, I also feel that if they can provide initiatives that enable greater benefits to others, then there should be a reward for their efforts, and by that I do not mean the sort of “we provide jobs o reward us” type of blather.

  32. Daniel Pitt

    Coalition must not destroy legacy of lowest child poverty for 25 years: http://bit.ly/kpzZTb #ConDemNation

  33. Carolyn Anderson

    Coalition must not destroy legacy of lowest child poverty for 25 years | Left Foot Forward http://goo.gl/msV7M

  34. Rebecca Ward

    RT @carolynanderson: Coalition must not destroy legacy of lowest child poverty for 25 years | Left Foot Forward http://goo.gl/msV7M

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