2 Our approach
7. In March 1999, the Prime Minister committed the
Government to eradicating child poverty "within a generation".
The Committee understands child poverty to be an aspect of family
poverty. Following substantial growth in the national child poverty
rate from the early 1980s, the rate peaked at around 34% in 1996-97
and since then has been on a downward trend. Currently, some 3.6
million children in Great Britain are in relative poverty - a
rate of 28% in Great Britain. This report analyses the effectiveness
of the Government's anti-poverty strategy, examines what needs
to be done to ensure that the child poverty targets are met, and
looks to the future by considering child poverty broadly and making
recommendations accordingly. However, first it is worth attempting
to answer the question - why did child poverty increase by so
much?
8. The answer is that the past few decades have seen
fundamental social, economic and demographic changes which have
strongly influenced the child poverty rate. For example, unemployment
increased sharply in the first half of the 1980s - peaking at
more than three million - with another peak occurring in the early
1990s. Although the UK now has the lowest unemployment rate since
1975 (2.9%) and a claimant count of 885,200 (1.44 million using
the ILO measure), rates of economic inactivity have risen so that
more than one in five (21.3%) of the working age population is
now without a job and not actively seeking work. The proportion
of workless households doubled from less than 10% in the mid 1970s
to nearly 20% in 1996 - the rate is currently just under 16%,
and for households with children is 15%.[4]
Employment patterns have also changed with a substantial growth
in part-time work, temporary and short-term contract work and
in self-employment. More women are now employed and the nature
of work itself has changed with a decline in manufacturing and
a rise in service industries.
9. The child poverty rate is also affected by the
large-scale changes in family formation that have occurred in
recent decades with a large increase in lone parent families,
who now make up a quarter of all families with children in the
UK[5]. The proportion of
children living in lone parent families increased from 7% in 1972
to 25% in 2003[6] - one
of the highest rates in the EU[7].
The most common route into lone parenthood is marriage breakdown,
with over half of lone parents being divorced or separated. In
addition, a significant number of lone parents are ex-cohabitees.[8]
In 1971 there were less than 80,000 divorces, but this peaked
at 180,000 in 1993 before falling to 157,000 in 2001. The UK has
the third highest divorce rate in the EU (2.7 per thousand population)
and the fourth highest rate of births outside of marriage (41%)
although, in 2002, nearly two-thirds (64%) of the births outside
of marriage were jointly registered by cohabiting couples living
at the same address - more than twice the proportion in 1986.[9]
10. It can be argued that the high unemployment rates
outlined in paragraph eight and marital and relationship breakdown
interact, thereby decreasing family incomes, undermining stable
parenting, and increasing child poverty. A literature review on
families examined the range of research on family change and identified
several factors that increase the likelihood of marital breakdown,
concluding that economic disadvantage is clearly linked with divorce,
cohabitation, lone parenthood and step-families. The review also
acknowledged that cultural and attitudinal changes have contributed
to changing family structures and that the relationship between
these changes and structural changes in society are complex.[10]
11. Teenage pregnancy has also become a worrying
aspect of the social landscape with the UK continuing to have
the highest teenage birth rate in Western Europe. Although conception
rates in England for under 18s have fallen since the teenage pregnancy
strategy was established in 1999, the rate has increased from
2001 to 2002.[11] The
children of teenage parents are more likely than children of older
parents to be in poverty and are also more likely to suffer adverse
outcomes as they get older. In addition, the likelihood of teenage
pregnancy is greater for those who have grown up in poverty.
12. Other instances of social change have occurred
which are also strongly associated with poverty. These include
an increase in rates of people reporting a limiting long-term
illness or disability, an increasing minority ethnic population
and an increase in people seeking asylum in the UK.
13. Against this backdrop of social and economic
change child poverty grew to unacceptable levels and children
in all of the groups outlined so far were at particular risk of
poverty. However, it would be too simplistic to argue a direct
causal link with characteristics such as worklessness, lone parenthood
or teenage pregnancy. As the Child Poverty Action Group (CPAG)
point out, even the most affluent people may share these characteristics
- the difference is that they are able to buy their way out of
deprivation and exclusion.[12]
In addition, similar social and economic changes have been seen
in other countries too, yet they did not experience the same increase
in the child poverty rate. The difference may be that our social
protection system operated less successfully then those of comparative
countries, that our policy framework for families was less developed
than theirs, that our rises in unemployment were especially severe,
that our family structure was especially vulnerable or a combination
of some or all of these factors. The question remains: what can
the Government do to ensure that families have enough income to
provide a decent standard of living and to lift children out of
poverty and, more broadly, in partnership with the voluntary and
community sectors to increase good parenting, family stability
and children's life chances?
14. From 1980 to 1997, relative child poverty rose
markedly, although average absolute expenditure by poor families
also rose. That rise in relative poverty has been attributed
by some commentators to some of the policies of past governments,
for example, the freeze on Child Benefit.
15. The Government's approach to benefits and tax
credits has been called 'progressive universalism' and is described
in the Pre-Budget Report as providing "…help for all
families and more help for those who need it most, when they need
it most."[13] Universal
support is provided through Child Benefit and targetted support
through the progressive Child Tax Credit which aims to reach up
to 90% of all families with children. While a targetted approach
may be the most cost-effective method of raising the income of
low-income families there has to be recognition of the negative
side-effects associated with targetting, including disincentives
to work, administrative costs, eligibility, regional disparities
and non-take-up of benefits.
16. It should also be added that with the current
attention on the 2004 target to reduce child poverty by a quarter,
it is easy to focus on poverty defined as a lack of income and
ignore other aspects of poverty, including social exclusion. There
is considerable debate around what is actually meant by the term
social exclusion[14]
and, as the first Opportunity For All report noted, the
terms social exclusion and poverty are often used interchangeably.
Opportunity For All uses the Prime Minister's description
of social exclusion as:
"A short-hand label for what can happen
when individuals or areas suffer from a combination of linked
problems such as unemployment, poor skills, low incomes, poor
housing, high crime environments, bad health and family breakdown."[15]
17. The question has also been raised of whether
the emphasis on the income measure of poverty means that anti-poverty
strategies tend to focus the policy response on increasing parents'
incomes through a combination of raising employment rates and
reforming tax and benefits rather than, for example, focusing
on improving outcomes for children by improving public services
or supporting stable parenting.[16]
There is a debate to be had on this issue and on whether the new
poverty measure, which includes a measure of deprivation, will
change things.
18. Finally, in spite of recent and welcome increases
to the income of poor families through the £3.50 per week
increase in the child element of Child Tax Credit, it could be
argued that the Government appears to have placed more emphasis
on poverty alleviation by encouraging people into work through
a wide range of employment initiatives and work incentives. While
some of these have undoubtedly been successful, there may be limits
to how far the strategy can go. The various employment PSA targets
for different groups show that the Department is struggling to
increase the employment rate of minority ethnic people and disabled
people in particular. The rise in lone parent employment is also
slowing. This suggests that a new employment strategy is needed,
which recognises the multiple and diverse barriers to work faced
by some groups. In addition, for some people, the Department might
be approaching the limits of what can be achieved through the
welfare to work strategy, so that increasing benefits and tax
credits for those who are unable to work may be the best way to
further reduce child poverty and hit the 2010 target.
19. The Committee
recommends that a comprehensive UK-wide strategy for reducing
child poverty is drawn up and published as part of the forthcoming
Spending Review. The strategy should consolidate existing child
poverty reduction goals and other PSA targets and establish a
clear policy framework to be pursued between now and 2010.
4 ONS, Labour Force Survey, Autumn 2003 Back
5
ONS (2002) Living in Britain: results from the 2001 General
Household Survey, London TSO Back
6
ONS (2004) Social Trends, No 34, London: TSO Back
7
DWP, Family Resources Survey 2002-03 Back
8
Labour Force Survey figures, quoted in One Parent Families:
the facts 2003 Back
9
ONS (2004) Social Trends, No 34 Back
10
Millar J & Ridge T (2001) Families, poverty work and care,
DWP Research Report No 153, Leeds: CDS Back
11
The current conception rate is 42.6 per 1,000 females aged 15-17,
compared with 47 per 1,000 in 1998. Back
12
Flaherty J et al (2004) Poverty: the facts, London:
CPAG Back
13
HMT, Pre-Budget Report, December 2003,Cm 6042 pg 97 Back
14
Ev 62 Back
15
Department for Social Security, Opportunity For All: First Annual
Report 1999, CM4445, Sepr 1999 Back
16
Ev 126 Back
|
