A fairer share for all – Ending Poverty in the UK – Part One

A fairer share for all – ending poverty in the UK Part One

In our consultation paper https://www.libdems.org.uk/sconf19-consultation-paper-137  A Fairer Share for all, we have a section on “reducing poverty and increasing opportunity” which mentions the UN Special Rapporteur “damning statement on the level of poverty in the UK today”.

It doesn’t mention the Joseph Rowntree Foundation’s latest report, “UK Poverty 2018” (https://www.jrf.org.uk/report/uk-poverty-2018” which states the following as the poverty line for different household types in 2016/17 (amounts per week):

Single person no children £148
A single person with two children £306
Couple with no children £255
Couple with two children £413.

These are from April 2016. The CPI rates which benefits should have been increased by were 1% for April 2017, 3% for April 2018 and 2.4% for April 2019 cumulatively making 6.5% https://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-8458  House of Commons Briefing Paper CBP.

Therefore the rates after being increased by inflation (CPI) for April 2019 are:

Single person no children £157.62
A single person with two children £325.88
Couple with no children £271.58
Couple with two children £439.84.

The consultation paper lists some of our existing policy:

  • Increase benefit payments in line with CPI, with a longer-term aspiration to tie increases in benefits rates (apart from housing benefit) to increases in median earnings;
  • Scrap the benefits cap;
  • Increase Local Housing Allowance in line with local rents;
  • Increase the minimum wages for young workers up to the same as the minimum wage for older workers; increase the rates of JSA and UC for those aged 18 – 24 in line with
    increases in minimum and apprentice wage rates for that age group;
  • When personal Income Tax or National Insurance allowances rise, increase work allowances by the same amount so that poorer people don’t lose out on the benefit of tax cuts;
  • Separate employment support from the administration of benefits, through devolution of powers to local authorities;
  • Support claimants living in areas with poor transport links, and those who are unable to travel for other reasons, through increased use of mobile Jobcentre surgeries and home visits.

It doesn’t list:

  • Reversing the cuts to Universal Credit;
  • Abolishing the Bedroom Tax;
  • Scrapping the two-child limit on benefits;
  • Scrapping sanctions.

The working group has failed to address how to remove 22% of the UK population from poverty. That is 8.2 million working-age adults, 4.1 million children, and 1.9 million pensioners.

The easiest group to remove from poverty should be pensioners. One in six pensioners lives in poverty. According to the Joseph Rowntree Foundation “recent rise in pensioner poverty has been primarily driven by increases in poverty among pensioners who rent”. The abolition of the bedroom tax which is party policy (but missing from the list of policies in the paper) should remove pensioners in social housing from poverty. However, just increasing Local Housing Allowance in line with local rents will not help the 36% of pensioners who rent privately from poverty. Even restoring the level to LHA is unlikely to remove even 9% of them.

To assist pensioners, the pensioners receiving the old pension may need to receive more. The old pension rates are £129.20 for a single person and £206.65 for a couple a week. The Guarantee Credit rates are £163 for a single person and £248.80 for couples. Therefore we need to increase the Guarantee Credit for couples to poverty level (excluding housing costs) of £271.58.

In part two I will set out what more can be done concerning the LHA, what level of benefit is needed for each child and how we could increase adult benefits to the poverty level over six years.

* Michael Berwick-Gooding is a Liberal Democrat member in Basingstoke and has held various party positions at local, regional and English Party level. He posts on this site as Michael BG.

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10 Comments

  • Katharine Pindar 13th Mar '19 - 5:43pm

    Another excellent contribution from Michael to show the policies needed to address the worsening poverty in our country. The specific amounts required, and their relationship to our policies together with restatement of these, are the specifics which members need to know so as to keep demanding urgent action from the Government, whatever its other preoccupations.

    I trust the Fairer Shares for All Working Group in its Consultation Session in York will be made fully aware of Michael’s conclusions, and that you will yourself, Michael, contribute a full statement to the WG covering them, including the conclusions of the paper yet to come, by the end of this month as is required. Anyone attending the Consultation Session on Friday afternoon (as I myself hope to do) will surely be glad of this reinforcement of our arguments and our aim to help the poorest.

  • David Warren 13th Mar '19 - 6:19pm

    Excellent article by Michael.

    I really hope we can convince the wider party that the current level of benefits are nowhere near enough to live on.

    A truly radical policy that advocates a decent amount of money for those who can’t find a job, or are unable to work due to illness or caring responsibilities would not only be right and popular but it might also move us on from the legacy of some of our MPs voting for welfare cuts during the coalition years.

  • @ Simon McGrath

    Thank you for pointing out the mistake in my article. As David Raw points out the bedroom tax will apply to pensioners from April this year. I think this is some pensioners and not all. Therefore the bedroom tax cannot be the reason that 130,000 more pensioners living in social housing are living in poverty now than in 2012. Perhaps this is because the Guarantee Credit pension level has not been increased in line with inflation (RPI) by about 5% since 2010.

    Thank you Katharine Pindar, David Raw and David Warren for your positive comments. I hope others will agree with us that in the words of David Warren, “the current level of benefits are nowhere near enough to live on.”

  • I am very glad that this issue is being raised. We need to ensure that nobody has to live in poverty.
    There are a number of issues we need to look at when discussing this. The developments in epigenetics are showing the genetic mechanisms by which stress in the parents can transmit changes in the children. This is of course in addition to the environmental impacts on the children.
    Although I do not oppose the pupil premium, I believe that the best way of dealing with educational underperformance is to ensure that children can get sleep, an adequate diet, and live in a situation where there is not unreasonable stress.

  • Sue Sutherland 14th Mar '19 - 10:59am

    You’re absolutely right Michael. Of course we must reverse those punitive measures. I’m glad you and Katharine are on the case.

  • As chair of the working group I wanted to quickly clarify that we are in favour of the party’s existing policy to:

    Reverse the cuts to Universal Credit;
    Abolish the Bedroom Tax;
    Scrap the two-child limit on benefits;
    Scrap sanctions.

    We are also keen to address the current local housing allowance system, whether this is through UC, UBI or NIT – a big question which needs to be settled to form a framework for our welfare state before its constituent parts can be finalised.

    I should also clarify that we have met with, and taken evidence from, a range of outside groups including some of those mentioned above.

    With such a broad ranging policy paper, there is a need to take into account party policy in other areas which we have not had the scope or time to focus on during the course of the working group such as housing or education policy. We have focused instead on three policy areas – reducing poverty (with a focus on Universal Credit and potential alternatives such as UBI, negative income tax, or universal basic services), improving work life (which has so far focused largely on the issue of universal childcare), and local services and regional infrastructure (with a focus on how we rebalance capital spending geographically across the UK).

    We have deliberately tired to cast the net widely and be non-prescriptive on setting new benefit levels etc at this stage so as to capture the input from those on this forum, from those who will be in York tomorrow, and from across the party before the end of the month.

    All of the working group look forward to hearing from party members and external experts on all of the above issues.

  • Thank you Tom Harney and Sue Sutherland for your positive comments.

    The children who get free school meals based on poor family incomes are those whose parents receive Jobseekers Allowance, Employment and Support Allowance, the Guarantee element of the State Pension Credit, Child Tax Credit if earning £16,190 a year or less but not receiving Working Tax Credit, or Universal Credit if earning less than £7400 a year (the rules in Scotland are different). As the parents who receive Jobseekers Allowance, Employment and Support Allowance, the Guarantee element of the State Pension Credit are living in poverty no-one should be surprised if they are suffering with stress. If there are at least two children in the family it is likely that that family if earning £16,190 a year or less and receiving Universal Credit are also living in poverty.

    @ Paul Noblet

    Firstly thank you for posting a comment. It is good to know that the working group is in favour of the four policies you list. I hope this fact will make it into the final report.

    It is disappointing that you don’t state that the working group is aware of the issues with LHA and will be coming forward to proposals to dramatically reform the system so at least half of the property in an area can be lived in by people who are receiving benefits.

    I can’t see where it is stated in the consultation paper that benefits should be set at the poverty level; I can’t even see where it states that this should be even a long-term aim for the party.

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