House of Commons - Work and Pensions

Select Committee on Work and Pensions Written Evidence

Memorandum submitted by Professor Ruth Lister into Child Poverty (CP 01)

SUMMARY

1. Progress has been made towards meeting the Government's child poverty targets but further measures are necessary, if they are to be achieved.

2. The current, future-oriented, emphasis on children as an investment and on their future development needs to be complemented by greater recognition of the importance of childhood and of the impact of poverty on childhood.

3. Development of a new measure of child poverty should be based on a clear and focused definition.

4. Children's poverty cannot be divorced from the poverty of the families in which they live and in particular from that of their mothers.

5. The DWP's decision to do further work on a "tiered" measure of child poverty is sensible. Income should remain central to the measure. For all its weaknesses, the "relative" 60% of median income measure should be retained. It is, though, regrettable that the DWP has rejected the proposal to develop a research-based income measure through use of minimum income standards.

6. Particular attention needs to be given to a number of pressure points: large families, minority ethnic families (including asylum-seekers) and the transition into paid work.

7. The child poverty strategy needs to balance: child tax credits and child benefit; help for those in and out of paid work; improvements to financial support for children and adults.

8. In addition to improvements to benefits, the social fund and tax credits, there needs to be a transformation in the social infrastructure, including child care.

9. A higher profile, unequivocal and consistent anti-poverty government message, integrated into a vision for a fairer society, is necessary to create the political support for the further steps necessary to eradicate child poverty.

10. The Government should build on the steps it has begun to take to involve those with experience of poverty in the development of policy.

EVIDENCE

Introduction

1. The Government deserves praise for its pledge to eradicate child poverty in two decades and its commitment to interim targets for reducing child poverty by a quarter and by a half. The policies it has introduced are beginning to have an impact on the numbers of children in poverty but there is a general consensus that further measures will be needed, if it is to meet its 2004 PSA target of reducing the numbers by at least a quarter and its 2010 target of halving the numbers. The Chancellor's welcome announcement of a "Child Poverty Review", which "will set out what further action is required to halve child poverty by 2010 and eradicate it by 2020", suggests that the Government itself recognises that more needs to be done.[1]The Committee's inquiry therefore comes at an opportune moment.

2. The main argument put forward by the Government for the priority it gives to tackling child poverty is that "our children are our future and the most important investment that we can make as a nation is in developing the potential of all our country's children".[2] This is a powerful argument and it is supported by the growing body of evidence of the effects of poverty on children's educational and health development and their future life chances. There is a danger, though, that such arguments take on an instrumentalist tone, as in the statement that "support for today's disadvantaged children will therefore help to ensure a more flexible economy tomorrow".[3] There is a growing concern that this kind of future-orientation, which constructs children as citizen-workers of the future, is losing sight of children qua children and the importance of childhood.[4] Childhood is only lived once and for a limited time span; the impact of poverty on childhood, particularly of longer term poverty, is therefore important in its own right.

3. This submission does not attempt to address all the issues raised in the Committee's call for evidence. It focuses on three main areas: measurement, particular pressure points and strategy.

THE MEASUREMENT OF CHILD POVERTY

Measures and definitions

4. A recent parliamentary question asked when the "new definition of poverty will be announced". The answer referred to the consultation on measuring child poverty and stated that "we will announce our definition of child poverty by the end of the year".[5] This exchange illustrates the tendency to conflate—or confuse—definition with measurement. Despite the consultation on measurement of child poverty, there remains a lack of clarity as to what it is the Government wants to measure in terms of a definition of child poverty.

5. Measures are the means of operationalising definitions. The starting point should, therefore, be a clear and focused definition of child poverty. This should capture the essence of what distinguishes the state of poverty from that of not-poverty. There was no such definition in the measuring child poverty consultation document. Instead, there and elsewhere in official statements about poverty, there is a tendency to list conditions associated with poverty as a substitute for definition. In a number of cases, most notably the annual poverty report Opportunity for All, some of the indicators of child poverty are better understood as indicators of lack of "well-being" or "capability deprivation", which, while important in its own right, is a broader condition than poverty, as conventionally understood.[6] To conflate the two is unhelpful and potentially misleading.

Child and family poverty

6. A working general definition of poverty, which reflects much of the literature, would be on the lines of "an inability to participate in society and to enjoy a standard of living consistent with human dignity and minimum standards of social decency due to lack of resources". However, given the particular focus on child poverty there may be a case for amplifying this. For example a definition of adult and family poverty could be complemented with a notion such as the "inability, because of lack of resources, to enjoy the kind of childhood taken for granted in the wider society and advocated by experts on childhood". Both are necessary because ultimately childhood poverty cannot be divorced from family poverty and to do so could lead to an underestimation of the extent of child poverty relative to adult poverty. In countries such as the UK, where childhood poverty rates are higher than adult rates, this would be the effect of suggestions that we should compare children's incomes and living standards only with those of other children.[7] In other words, while we need to be sensitive to the specific experiences and perspectives of children, this is not the same as arguing that the incomes and living standards of children and the families in which they live should be compared only with those of other children/families. To do so would be to understate the rate of child/family poverty in countries where this is higher than the overall poverty rate.

7. This does, though, raise the question as to whether what is at issue is the extent of poverty among children or among households in which children live. The former would require examining poverty at an individual rather than household level, which would also have the advantage of opening to the public gaze, the extent of hidden poverty among women. In terms of deprivation, though, a measure of child poverty, which focused only on children, would camouflage the extent to which parents, and in particular mothers, sacrifice their own living standards in an attempt to protect their children from the worst effects of poverty. Thus, while I am in favour of measuring adult poverty at the level of the individual (difficult as that would be), the measurement of child poverty cannot be separated from that of the families in which they live.

Broader conceptualisation

8. Ideally, a definition of child/family poverty, which combines low income and both parental and childhood deprivation, is what needs to be captured in any long-term measure(s) used for monitoring progress in tackling child poverty. This/these can then be complemented by:

Opportunity for All

The role of income in measuring poverty

9. The attempt to develop a new measure of child poverty—including a "headline" measure—faces a dilemma. On the one hand there is a growing consensus in the academic literature that no single measure is adequate to capture the extent and depth of poverty and its relationship to deprivation. On the other hand a headline measure implies a single measure. Moreover, as the majority of those who responded to the consultation document argued, low income is widely seen as "being central to any poverty measure".[10] The decision to do further work on a "tiered approach" therefore makes sense. I would argue for the following in this process:

— Consideration should be given to including both a poverty gap measure and some specific childhood deprivation indicators.

— A clear distinction needs to be made between indicators of poverty and indicators of capability deprivation or lack of well-being.

10. Another issue arises in relation to the nature of the income measure(s) adopted. The current "headline" measure of 60% of median income is an arbitrary measure. Nevertheless, for all its conceptual and technical weaknesses, it is simple, it provides historical continuity and it allows for international comparison especially within the European Union. Moreover, so long as the Government itself retains responsibility for the compilation and publication of the poverty statistics, to jettison this headline measure could open it to accusations of "moving the goalposts".

11. Indeed, such fears are currently being voiced in relation to the post-2004 PSA targets. In particular, there is some anxiety that the fixed "absolute" measure will replace the current "relative" measure as the basis for the child poverty targets. If poverty is understood as a relative phenomenon, it does not make sense to measure it using a poverty line that does not reflect changing living standards and expectations. There may be a case for retaining the fixed measure as a "bottom line measure" but it should not be substituted for the "relative"' measure currently widely used as a headline measure.

12. There is also a case for the longer term development of an income measure grounded in empirical research, drawing on minimum income standards. This case was made by the former Social Security Select Committee on more than one occasion. It is therefore regrettable that it was dismissed in the Preliminary Conclusions to the Consultation.

PARTICULAR PRESSURE POINTS

13. Within the overall statistics, there are some groups of children with a particularly high risk of poverty. These include children in large families and children in minority ethnic families.

Large families

14. Larger families are at disproportionate risk of poverty. The DWP estimates that "by 2004 over half of those children in low income will be in large families".[12] Recent research published by the DWP found that "greater hardship was associated with families of three or more children . . . Couple families with three children were twice as likely to be in hardship compared to families of two children, although the degree of hardship was concentrated at the moderate level. Severe hardship (three or more problems) was substantially greater for families of four or more children".[13] This applied to both lone and two parent families. A study by the Centre for Research in Social Policy, carried out for Save the Children, found that children in families with three or more children were more likely to be in severe and persistent poverty.[14] Although the analysis suggested that family size was not the cause of that poverty, the researchers point out that the structure of benefits for children in the UK disadvantages larger families. The child benefit differential in favour of the first child has been increased significantly under the present government. As I argued in my evidence to the Social Security Select Committee's inquiry into child benefit, we need an evaluation of the available evidence in order to assess whether the current structural bias in favour of smaller families is justified.

Minority ethnic families and asylum-seekers

15. The Households Below Average Income report observes that individuals in households headed by a member of a minority ethnic community "were skewed towards the bottom of the income distribution. This pattern was particularly marked for the Pakistani and Bangladeshi group, with approximately three out of five individuals in these families having incomes in the bottom quintile of the income distribution".[15] Analysis of the depth, as opposed to the extent, of poverty also indicates that minority ethnic children "are likely to be further below the poverty line".[16] Not surprisingly, there is also greater deprivation among minority ethnic children than among the white majority, with "an extraordinary level of concentration among Pakistani and Bangladeshi children".[17] Within this overall context of disadvantage, both the diversity of experience between minority ethnic groups and what has been described as the "shocking"' position of Pakistani and Bangladeshis, for whom "poverty is their most common experience" stand out.[18]

16. The accumulating evidence of the greater risk of child poverty among minority ethnic groups, particularly those of Pakistani and Bangladeshi origin, means that it is essential that the ethnic dimension is "mainstreamed" within the analysis of child poverty and within the Government's child poverty strategy.

17. In addition, attention needs to be given to the position of child asylum-seekers. The fact that they are not included in the poverty statistics does not mean that they should be excluded from the commitment to tackle child poverty. Policies to combat child poverty must be inclusive of all groups of children resident in the country.

Transitions into paid work

18. Although movement into paid work (supplemented by tax credits) is usually associated with an improvement in income and living standards, this is not necessarily the case—especially in the short term. A number of policy changes have been introduced designed to ease the transition from benefits into paid work and to protect people if a job does not work out or is short-lived. These have been very welcome. Nevertheless, these changes may not have been sufficient to overcome the problems revealed by research. Two recent studies, in particular, highlight how the transition into paid work can represent a pressure point.

19. A study by the National Centre for Social Research for the DWP found that a combination of low pay and higher costs (especially childcare), and sometimes former debts, meant that some households described themselves worse off after a move into paid work. Money management was more difficult than when on benefit. Although "some `worse off' families were determined to remain in work and off benefits, others found that the impact of being worse off financially, and psychologically too, became too much over time. Ultimately some households felt forced to leave their jobs and return to benefits as they saw this as being the better option".[19] The children, in particular, suffered because any discretionary spending while on benefits had been directed towards them.

20. One of the most significant findings of the CRSP study for Save the Children, mentioned earlier, was that persistent and severe child poverty was associated with income volatility, measured as two or more transitions between benefit income and work or other income as the main source of income. "Children whose households underwent two or more such transitions were much more likely to be in persistent and severe poverty than children who did not experience these transitions".[20] The authors point to the need for policy to provide greater protection during periods of transition between benefits and paid work and vice versa and to do more to prevent people falling back on to benefit or moving on to benefit in the first place. This last point, which implies the importance of prevention, deserves emphasis in its own right.

STRATEGY

21. As stated in the Introduction, there has been real progress in the reduction of child poverty since the Government came to power but more needs to be done, if that progress is to be maintained and targets are to be met. This section considers the question of strategy from three perspectives: questions of balance; the broader policy context; and the politics of child poverty.

Questions of balance

Child Benefit and Child Tax Credit

22. The Government has adopted a principle of "progressive universalism", which means "supporting all families with children, but offering the greatest help to those who need it most through a light touch income test".[21] There is growing support for a further increase in the child tax credit (CTC) in order to meet the 2004 PSA target. Such an increase is needed but it should be complemented by an increase in the real value of child benefit, if the commitment to universalism is not to start looking rather hollow. The administrative problems associated with the introduction of the new tax credits system underline the importance of a benefit that is reliable and cheap to administer. Although the acceptance of the case that benefits for children are best paid to the caring parent is very welcome, a caring parent's entitlement to CTC is still affected by a partner's income. Where income is not shared fairly in the family, this could still mean that some mothers are not getting the money they need. Under the new CTC structure, a payment of child benefit will, like CTC, be of equal value to children in families in or out of paid work.

23. In its 1999 report on Child Benefit, the Social Security Committee endorsed child benefit's multi-purpose role and welcomed the Government's commitment to its continuation as "the foundation for the future support for children".[22] That foundation might start to look rather shaky, if child benefit is frozen in real terms while CTC grows in value. It would therefore be very helpful if the Committee could reiterate its support for child benefit as a key element in the strategy to end child poverty.

In and Out of Paid Work

24. "Work not welfare" has been the central plank of the Government's child poverty strategy. The increase in employment has contributed to the reduction in child poverty. Nevertheless, there continues to be a real problem of poverty among those in paid work, which tax credits are only partially addressing. As End Child Poverty and the Work Foundation have argued, more attention needs to be given to what happens to people once they have made the move from benefits into paid work in order to ensure that they do not get trapped in low-paid work subsidised by tax-credits.[23]

25. Despite an initial antipathy to improving out-of-work benefits, the Government has increased the real value of the children's income support/income-based jobseeker's allowance rates so that, for younger children, they have virtually doubled in real terms over the lifetime of the Government. This is very welcome. The big reduction in the incidence of severe hardship among non-working families and their children in the panel study conducted for the DWP by the Policy Studies Institute would appear to vindicate the decision to improve out-of-work benefits for children.[24]

26. Nevertheless there remains a significant proportion experiencing moderate or severe hardship; indeed the increase in the proportion experiencing moderate hardship suggests that many of those no longer experiencing severe hardship continue to experience real difficulties. Further improvements are therefore necessary. Concerns that improvements in out-of-work benefits will adversely affect work incentives need to be weighed against the evidence that the greater the hardship, the lower morale and self-confidence are likely to be, to the detriment of job-seeking.[25] Getting by on inadequate benefits involves hard work that can sap the energy needed to seek ways out of poverty. The ill health experienced by many parents and children in families on benefit makes the task harder and can act as a barrier to movement into paid work.[26] It is therefore unhelpful and demeaning to characterise benefits as a "passive" form of welfare in contrast to "active" forms of welfare designed to activate people to find work. Adequate benefits are necessary to support parents in their struggle to get by and bring up their children.

27. Urgent reform of the social fund is also necessary as part of the child poverty strategy.[27] It is already two years since the Committee reached its verdict that the inadequacies of the social fund were undermining the Government's child poverty strategy and indeed that they were exacerbating the poverty experienced by families with children. It declared this "unacceptable".[28] The position continues to be unacceptable.

28. There needs to be sensitivity to the tensions that the emphasis on paid work can create for lone mothers in particular. For instance, a small UK study reveals the strain and time squeeze that conflicting policy pressures—to take paid work and to be more involved in their children's education—can place on lone mothers.[29] An ethnographic US study found that the move to paid work can have a detrimental effect on mothers' efforts to help with their children's education.[30] Thus, a short term improvement in financial position might have perverse longer term consequences for their children's ability to get out or stay out of poverty. The evidence on parental help with homework from the DWP Families and Children 2001 survey does not show a clear pattern as between low income parents in paid work or on benefit [31]; more research—both qualitative and quantitative—on the issue would be helpful.

Children and Adults

29. Although there has been a significant real increase in out-of-work benefits for children, particularly younger children, there has been no real increase in the standard adult rates. While it made sense to prioritise the children's rates, which research had shown were particularly low relative to needs, the time has come to consider whether this is sufficient. A qualitative study carried out for the DWP into how low-income families with children spend an increase in household income decided to exclude households who remained on benefit because those in the pilot "found it hard to perceive any increase".[32] Some of these families contained under-11 year old children and therefore will have benefited from the significant phased improvement in these rates. However, a significant real increase in what was a very low amount to start with may not always make sufficient difference to the finances of hard-pressed families. Parents will judge the amount of benefit on the total amount they receive, not the amount provided for each family member. For the increase in the total amount to make a real perceptible difference to the recipient may require an increase in the adult as well as the children's rates.

30. As argued above, child poverty cannot be divorced from the poverty of the family in which they grow up and in particular the poverty of their mothers who tend to manage poverty in the family and to act as shock-absorbers in an attempt to protect their children from its full effects. Poverty is, for this and other reasons, a gendered phenomenon.[33]It is important therefore to combine a children's perspective (including their perspective on the effects of poverty on their childhood) with a broader concern with family and women's poverty. Families need sufficient income to participate in society and to enjoy a standard of living consistent with human dignity, as called for by the European Commission.[34] Children should be able to enjoy their childhood and to "fit in" and "join in" with their peers.[35]

The broader policy context

31. In addition to thinking about immediate policy decisions, it would be helpful to look at those countries that have achieved very low child and family poverty rates, most notably the Scandinavian countries, in order to see whether there are any policy lessons that can be learned. Of course, it is not a simple question of just importing policies from different kinds of welfare regimes. It is nevertheless telling that, as a report from the Innocenti Research Centre has pointed out, "no country with a high rate of gross social expenditure has a high rate of child poverty". The report also concludes "it is clear that state provision for poor families is an important factor in all countries that have succeeded in reducing child poverty rates to low levels".[36]

32. Other evidence suggests that it is also the support provided for children and families generally which is important, including, in particular the social infrastructure of services and parental leave provisions that help parents combine paid work and child-rearing. Despite the very welcome child care strategy launched by the Government, and the Government's recognition of child care's crucial role in its child poverty strategy, provision remains woefully inadequate. Child care is a key policy not just in terms of enabling parents to participate in the labour market but also for its potential contribution to enhancing children's quality of life and development. Overall, the goal should be the kind of social infrastructure, which is necessary for the long-term elimination of child poverty and to improve the quality of life of families with children generally. Given the years of neglect, during which child care was regarded as a private responsibility, this will require not just marginal improvements but a transformation.

The politics of child poverty

33. The success of the Government's strategy to combat child poverty will not depend simply on its choice of policies. There is still a huge mountain to climb and in order to climb it the Government has to be able to carry the general public with it. There therefore has to be a political as well as a policy strategy. There are times when the Government appears to be pursuing such a strategy. But much of the time it keeps quiet about what it is doing. "Doing good by stealth" needs to give way to a higher profile, unequivocal and consistent anti-poverty message across government.

34. The anti-poverty message should not stand alone but should be integrated into, and presented as part of, a broader strategy to create a fairer society, and one in which children are genuinely valued. Engagement of the general population is necessary to combat the residualisation of the issue of poverty and thereby to build public support. A similar point was made in the New Policy Institute/Fabian Society report on a national strategy for social inclusion.[37]

35. Finally, the strategy should reflect the Government's commitment to revitalising democracy. The debate about the future direction of anti-poverty policy needs to include those most affected. The voices of those living in poverty can help to bring the debate alive to the wider population. The development of anti-poverty policy can benefit from the expertise borne of experience, as the Government is beginning to acknowledge at national as well as local level.[38] It needs to build on the steps it has begun to take to draw on this expertise.

Professor Ruth Lister

29 August 2003

1 HM Treasury Press Release (82/03), 7 July 2003, emphasis added. Back

2 Gordon Brown, Foreword to Pre-Budget Report, Tackling Child Poverty: Giving every child the best possible start in life, HM Treasury, 2001. Back

3 Budget Report 2003, para 5.4, HM Treasury, 2003. Back

4 See, for instance, T Ridge, Childhood Poverty and Social Exclusion: From a Child's Perspective, Policy Press, 2002; R Lister, "Investing in the citizen-workers of the future: transformations in citizenship and the state under New Labour", Social Policy and Administration, 37(5), 2003 (forthcoming); L Adelman, S Middleton and K Ashworth, Britain's Poorest Children: Severe and Persistent Poverty and Social Exclusion, Save the Children, 2003. Back

5 House of Commons Hansard, col 603W, 7 July 2003. Back

6 The notion of "capability deprivation" comes from A Sen, see, for instance, Development as Freedom, Oxford University Press, 1999. Back

7 See, for instance, B Bradbury, S P Jenkins and J Micklewright "Conceptual and measurement issues" In B Bradbury et al (eds), The Dynamics of Child Poverty in Industrial Countries, Cambridge University Press, 2001; J Micklewright, Social Exclusion and Children; A European view of a US debate, CASE, 2002. Back

8 See F Bennett with M Roberts, forthcoming report for Joseph Rowntree Foundation. Back

9 These ideas are developed in greater depth in R Lister, Poverty, Polity Press, forthcoming. Back

10 Measuring Child Poverty Consultation: Preliminary Conclusions. Department for Work and Pensions, 2003, p 31. Back