It’s been said that Margaret Thatcher’s governments did two things for poverty. First they increased it. Then they pretended it did not exist. As Alan Milburn prepares to makes his first speech as the Independent Reviewer on Social Mobility and Child Poverty on Tuesday, his task will be to help the Coalition avoid a similar, devastating, legacy.
The last government’s record was far from perfect, but Milburn should advise the Coalition to recognise the very real progress made and learn from the successes just as much as from the failings.
Some Ministers, including Lib Dems, have bizarrely trashed the last government’s poverty record by pretending they were in office for only two years. ‘Child poverty rose by 200,000’ they have claimed. Well, yes, if you take 2005 as the starting point and 2007 as the end point. But if you take 1997 as the starting point and 2010 as the end point, the Office for National Statistics will tell you child poverty was reduced by 900,000.
The Institute for Fiscal Studies attributes this progress in somewhat equal measure to increased parental employment and the targeting of higher support to low income families with children through benefits and tax credits.
The absurd idea that ending child poverty should not involve counting the number of children in poverty is a disturbing and regressive echo of the approach that led to child poverty accelerating in the 1980s and 1990s. We have comprehensively responded to the myth making on measuring child poverty this way before.
Milburn needs also to remind the Government that tackling the scandal of child poverty should be a national priority in the good times but even more so in the bad times. Doing right by these children is also doing right by the economy. By limiting children’s potential, poverty reduces the skills available to employers, and impedes economic growth. Living with child poverty costs Britain at least £25 billion a year.
There are now two main government narratives about child poverty. In the yellow corner is the ‘social mobility’ narrative, led by the Deputy Prime Minister, Nick Clegg; and in the blue corner is the more emotive ‘bad British parents’ narrative, led by Work and Pensions Secretary, Iain Duncan Smith.
The social mobility narrative suggests that with a narrow focus on improving the quality of early years services and schooling, children can flourish and succeed despite material deprivation at home and regardless of being socially and economically excluded from the mainstream of society. The evidence is clear that high quality early education and care leads to improved outcomes for children and the effects are the most long lasting for the most disadvantaged children – hence the importance of this investment. But the most powerful factor is still the home environment, so if you make their parents worse off, chances are you will not get the same effect. And we have no evidence yet of the long-term impact on child poverty of these policies. As readers of The Spirit Level will know, the evidence points strongly to another relationship – that higher social mobility is an outcome resulting from a more equal society with lower levels of income and wealth inequality.
There are fundamental issues that the social mobility narrative does not address. The UK economy has a growing problem of dependency on low pay. In the 1960s, pay accounted for 60% of GDP, but it is only 53% today. Pay is shared less fairly too, with much larger pay differentials between those at the top and the bottom and twice as many low paid jobs in the economy today as there were in the 1970’s.
The single biggest cause of child poverty is therefore the lack of jobs with a decent income that parents can raise their families on. There are far more children in poverty because their parent is a care worker, a retail assistant, a cleaner, a factory worker or a hospitality worker than because their parent is a gambler, alcoholic or drug addict. Around 6 in every 10 children below the poverty line are in homes where there is a parent in work.
The bad British parents narrative (which I have written on before) is a surprisingly literal pursuit of a ‘nanny state’ for its Conservative and Liberal Democrat proponents. It suggests that state services need to intervene much more in the lives of low income families, forcing parents to work and to improve their bad parenting skills. If a parent is in work but the family are still too poor, then it is they – rather than unscrupulous employers – who will face new financial penalties under the in-work conditionality rules of the Universal Credit.
Measured after housing costs, there are 3.5 million children below the poverty line inBritaintoday. This is around 3 in every 10 children and it is about twice as high a child poverty rate as countries like Germany, Finland, Norway, Denmark, Slovenia and Sweden. Are we really to believe that the key difference between theUKand our European neighbours with much lower levels of child poverty is the poor quality of British parents? There is in fact no evidence that low income families are any worse at parenting than anyone else.
Surely it is differences such as better pay and conditions for workers, adequate benefit and tax credit payments, higher state investment in universal childcare provision, more affordable housing and high quality public services that explains why they are doing so much better for their children that we are in the UK.
So, on Tuesday, we will be looking to Milburn to remind the Coalition about what the evidence says about why people are in poverty, what works to reduce or prevent poverty and, ultimately, that rising child poverty will be an indelible mark not just on the lives and life chances of children and our national prosperity but also on the Coalition’s legacy.
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