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27 Feb 2008 : Column 285WH—continued
Mr. Letwin:
The hon. Lady may remember, as I am sure the Minister does, that I was arguing for such early intervention many years back and I continue to believe in it. I also agree with what the hon. Lady said about health interventions at an early stage. However, just before she talked about those things, she spoke about those in dire poverty, which we could define as people earning less than 40 per cent. of median income. Does she agree that in that group, the bulk of the immediate problem is that people are not in work? Does she agree
that, above all, if we are to deal with people who are in the direst poverty, we need to find means for parents to get into work so that they are not stuck in dependency, often with chaotic lifestyles to go with it?
Fiona Mactaggart: I spoke about how important work is as a route out of poverty, but my suspicion is that the direst poverty is among people who are not able to take their first step into work at the moment because they or their children are disabled, or because of other complexities. That is one of the reasons why I argued that we need to have a definition of severe poverty, and why we should examine targeted strategies to deal with people in severe poverty. Simply saying to people in the circumstances that I described that their road out of poverty is employment is not, on its own, sufficient for those who cannot take the first step.
Mr. Letwin: I agree with that, too; we are not, on the whole, talking about people who can simply waltz into work. The problem is that there are hurdles to overcome. Does the hon. Lady agree that we need to find a means of getting what many of the third-sector providers provide—a way over the hurdles—if we are to find for people who earn under 40 per cent. of the median income a route into work and out of the chaotic lifestyles of addiction and indebtedness, and the other cycles of deprivation?
Fiona Mactaggart: I have long been an advocate of third-sector providers. I vividly recall visiting an American project that in this country would be classified as a project that deals with ex-offenders. However, it was an anti-poverty project. It recognised that people who had been in the criminal justice system were the most likely to face massive barriers to employment, ranging from having been locked away for so long that they did not know how to use the equivalent of the Oyster card in New York, to prejudice from employers. By providing targeted support to enable them to get into work, or by providing some element of supported employment as a step towards independent employment, the project was able to demonstrate that it could make a huge difference to the experience of some of the poorest people.
We should not romanticise the capacity of voluntary organisations to deal with these issues. Because state provisions have to be scalable and replicable and to meet targets and so on—that is a democratic imperative—the state can sometimes be what I might call stupid. It does not intend to be, but that is a consequence. However, although voluntary organisations can sometimes be fleet of foot, flexible and imaginative, going round the back door rather than the front, they cannot always do so; there are some groups that they cannot help, and if the state starts stitching the voluntary sector into the statutory system, it can sometimes lose those good qualities.
The romanticism that I sometimes see in Opposition Front Benchers—that such fantastic initiatives, many of which are good, are always available to solve the problem—is just that: romanticism.
Ms Buck:
I am grateful to my hon. Friend for giving way; I shall soon have to leave for a meeting with Mr. Speaker. Although I endorse what my colleagues said about the role of the voluntary sector in supporting
vulnerable individuals, let us not be seduced by that argument at the expense of recognising that the real barrier for people getting into work is almost always financial. That is particularly so for families. The real dilemma for those living in London—in inner London, 51 per cent. of children live in poverty—is the barriers of high housing costs and high child care costs. Voluntary organisations can support the individual, but they will not overcome those financial barriers. That needs Government support.
Fiona Mactaggart: My hon. Friend is right. She has done some excellent work in showing how, in high rent areas such as in her constituency and mine, a massive poverty trap excludes people from work. We need more intelligent mechanisms for housing benefit and so on to help support those who want to take low-paid work. Such people want to take work because they are desperate to get on, but the interaction between rent levels, housing benefit and tax credits means that taking work costs them, which means that they have less time to spend with their children. We should not expect poor people to have to make such a choice.
I hope that I have managed, in what was a longer speech than I had intended, to show that child poverty is a critical issue for the Government, that there are ways of solving the problem, and that we need to admit the difficulties of meeting the interim targets. We need to be as transparent as possible about that, but we must also keep the determination that we had when setting the target—that it is possible to eradicate child poverty and that we intend to do so.
John Bercow (in the Chair): Five or six Members are seeking to catch my eye. It is my intention to call the Front-Bench spokesmen to start winding up at, or close to, 3.30 pm. Members are perfectly capable of doing the mental arithmetic, but a certain self-denying ordinance would be helpful. I would like everyone to have the chance to speak, and I simply observe that if everyone called were content to settle for five minutes, I could probably achieve my objective.
3.4 pm
Mr. Mark Harper (Forest of Dean) (Con): It is a pleasure, Mr. Bercow, to serve with you in the Chair. I shall attempt to comply with your ordinance. I note that the hon. Member for Bradford, North (Mr. Rooney), the Chairman of the Work and Pensions Committee, is here; it would indeed be a shame not to hear from him, as I know that the Committee will be publishing next week its report on child poverty deprivation and social mobility—all issues raised by the hon. Member for Slough (Fiona Mactaggart). I pay tribute to the hon. Lady for securing this debate; it is about an important subject, one on which every Member of the House has views.
I shall touch upon four points, Mr. Bercow, and I shall try to keep as close to five minutes as I can. The first point I do not need to discuss at length. The hon. Member for Slough acknowledged that the Government have made some progress, but not as much as she would
have liked. Indeed, their performance has been disappointing by their own standards. The Minister will acknowledge that the Government’s target was to reduce child poverty by a quarter by 2004-05; the next target on that road is to halve child poverty by 2010. I would welcome it if the Minister did as the hon. Member for Slough asked, and was honest about her assessment of the Government’s progress. That issue came up last in questions to the Secretary of State for Work and Pensions, when my hon. Friend the Member for Epsom and Ewell (Chris Grayling) asked whether the Government were on track for hitting that target. The Secretary of State avoided answering the question; he confirmed that the Government were committed to the aspiration of doing so but would not give us a progress report.
John Penrose: My hon. Friend may like to know that when giving evidence to the Select Committee several weeks ago, the Government’s child poverty adviser said that it was her firm opinion that the Government would not hit the interim target in 2010.
Mr. Harper: I am grateful to my hon. Friend for that intervention. Given that that assessment was made by a Government adviser, it would help if the Minister shared with us the Government’s assessment, so that we know where we stand. The ultimate aspiration is one that we share. My right hon. Friend the Member for West Dorset (Mr. Letwin) put it on the record in 2006 that we were committed to the aspiration of eliminating child poverty by 2020.
John Battle: Our party went for that target a long time ago, and then Conservative Front Benchers signed up to it; it took a little longer for the Liberals to join up. I want to be absolutely clear about whether Conservative Front Benchers are still signed up to that target; there is some ambiguity.
Mr. Harper: I am grateful to the right hon. Gentleman for allowing me to make the position clear. There is no ambiguity at all. Our aspiration is clear.
Mr. Terry Rooney (Bradford, North) (Lab): An aspiration?
Mr. Harper: Yes, it is an aspiration. It has to be an aspiration because we do not know how things will be when we come into office. The hon. Gentleman will know that in the most recent period, between 2004-05 and 2005-06, the number of children below the poverty level increased. There are another two and a half years to go under the present Government, and if we come into office at that point we will not know how things will stand. The hon. Gentleman can make fun of the difference between “aspiration” and “target”, but the Secretary of State for Work and Pensions rather avoided using such specific language when talking about the 2010 target. It would be interesting to hear the Minister’s assessment of whether the Government will hit it. As I said, the Conservative party is committed to the aspiration of ending child poverty by 2020. That point was made clear earlier by my right hon. Friend the Member for West Dorset—and by my hon. Friend the Member for Epsom and Ewell in an excellent article in the press at the weekend, which made our position clear beyond peradventure.
Returning to your injunction, Mr. Bercow, I shall attempt to move on a little more quickly. We have touched on some of the facts. I did not have the chance to intervene at the time, but the hon. Member for Regent's Park and Kensington, North (Ms Buck), who is no longer in her place, referred to the fact that in London more than 50 per cent. of children are in poverty. That is clearly an important issue—one that will no doubt be discussed during the mayoral elections later this year.
In the remaining few moments, I shall touch on what the Conservative party would do in office. First, I pick up on the point made by my right hon. Friend the Member for West Dorset about welfare reform and getting many more people back into work, particularly the several million people on incapacity benefit. As the hon. Member for Slough said, we should not use only the voluntary sector because some things are not scalable; we should use private sector providers as well, as the Government look likely to announce they will this week. As the Secretary of State for Work and Pensions has made clear, they will adopt the Freud report in its entirety to move a significant number of people into work. Nearly 5 million people are on a range of out-of-work benefits, and that is obviously a significant contributor to child poverty.
The second issue, which I mentioned in my intervention, is ending the couple penalty in the tax credits system. In an analysis that it carried out for the social justice policy group chaired by my right hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith), the Institute for Fiscal Studies said:
“Bringing tax credits fully into line with the rest of the benefit system”
“1.8 million of the poorest couples with children will gain on average £32 a week”,
which would have the direct effect of lifting
“300,000 children in two parent families out of poverty.”
Clearly, that would be a significant achievement. The Conservative party has committed itself to ending the couple penalty in the tax credits system. That would be a powerful tool, and it would be interesting to hear the Minister’s response.
Finally, it would be interesting if the Minister indicated which Department has lead responsibility for the Government’s child poverty target. According to its website, it is the Department for Work and Pensions whose Secretary of State has the objective of ending child poverty. The Department for Children, Schools and Families does not have direct responsibility, but it works across government to achieve that target. It is important to clarify that, because if the Government miss their 2010 target, we want to be clear which Cabinet Minister the Prime Minister will blame.
3.11 pm
Mr. Terry Rooney (Bradford, North) (Lab): It is a pleasure to take part in the debate. I should just make one correction regarding the report that my Committee will publish on Monday: it is actually a seminal child poverty report, and I hope that people read and take an interest in it.
I want to focus narrowly on the issue of work because of the limited time available. The absolute fact is that moving people into work increases a household’s income;
it might not lead that household totally out of poverty, but it will significantly increase the income available to it, and we need to remember that.
One key issue is that literally tens of thousands of lone parents start work and stop again within three months, which suggests that some of the support mechanisms are not working. When we meet lone-parent groups, the key issue for them is the point of change. Although such people are on a relatively low income, it is secure and it is there every week, so they can pay their rent and keep a roof over their heads. When they move into the uncertain world of being paid a month at a time and having to make a fresh claim for housing benefit—frankly, some local authorities are abysmal at processing new claims—they say, “No. That is too big a risk for my children. I’m not going to do that.”
We can eliminate some of that risk, but the system is, unfortunately, extremely complex, although that is often for good reasons. It is designed to deal with the 0.2 per cent. of people who try to fiddle things, not the 99.8 per cent. who play the game. If a lone parent is willing to take the big step of moving into work, we should pay them 100 per cent. housing benefit for the first three months that they are in work. During that period, the local authority should assess their new level of housing benefit so that it will kick in on the first day after those three months. That would give the individual additional security.
People on incapacity benefit are in exactly the same situation. Many years ago, we had the horrendous system of therapeutic earnings, which was an abuse of individuals’ civil rights. We now have permitted working, which allows people to test work and to keep any earnings that they get up to a certain limit. Unfortunately, we have four different systems of permitted working rules. If somebody gets a job after having been on incapacity benefit for five, eight or 10 years, as people often are, I would say, “Well done. You can carry on getting your incapacity benefit and you can keep all your wages. Come back after three months, and we’ll talk about how it’s going and how we can translate this into a permanent situation.” The benefits system does not allow that, however, and we should not allow a system that has grown up over 60 years to hinder the drive to give people more money.
I want to touch on a longer-term issue. Whether the Government meet their target in 2010 or not is now an arcane debate; the direction of travel is right and the policies are getting better all the time. The issue is whether, come 2020, we have in place the longer-term infrastructure that we need to deal with such issues, in so far as that is possible, and there will always be somebody who accidentally falls temporarily into poverty. The major issue that we face is that benefits are increased by the retail prices index, while poverty is measured against wages. Wages will always go up faster than the RPI, so the gap between earnings and benefits will always increase. By 2020, there will be a cohort of people who cannot work because of disabilities or other factors, and we must ensure that the benefits available are such that they will lift those people out of poverty. That raises the issue of work incentives, and we need to start work now if we are to reach a situation in 10 years’ time where the benefits system does not trap such people in poverty.
There are huge issues relating to child care, and I know how committed the Minister is to promoting child care. Vast sums have been invested in it, and the number of places has increased exponentially, which is fantastic. However, 22 per cent. of places nationally are vacant, which raises a question. Only a third of those who are entitled to the child tax credit take it up, so something structural is obviously not working. We need to marry up those two points, because there is no point in investing in staff and buildings and creating places if they then stand idle.
If I may say so, I think that we have slightly oversold the guarantee on nursery education. We are talking about two and a half hours a day, although it will go up to three hours a day by 2010, but such child care does not assist the welfare-to-work programme or help somebody to move into work. Lots of people—particularly lone parents—will typically want to work evenings and weekends so that they can be around during the school day, but the child care system does not accommodate that. It certainly breaks down totally when we come to disabled children.
There were lots of other things that I could have said, but I have seen the time, so I will sit down.
John Bercow (in the Chair): As far as I can tell, four Members are still seeking to catch my eye from the Back Benches. I would dearly love to call each and every one of them, but I require some pretty exceptional self-discipline from Members at this stage.
3.18 pm
John Barrett (Edinburgh, West) (LD): I will certainly keep to your guidance, Mr. Bercow.
Before I turn to the issue of child poverty close to home, I shall take one minute to look at the wider problem elsewhere in the world, because the scale of poverty worldwide is hard to imagine. According to a recent UNICEF report, tens of millions of children in developing countries still do not have access to basic human needs such as food, water and sanitation. In many such countries, poverty is increasing, not decreasing, and issues such as malnutrition among the under-fives are particularly significant. Such children are often plunged into poverty through no fault of their own, because of famine, drought, conflict and war, corruption, the scourge of AIDS and natural disasters—the list goes on.
Closer to home, there is a wide variety of reasons why child poverty continues in the midst of wealth in many parts of our country, and I congratulate the hon. Member for Slough (Fiona Mactaggart) on covering many of those issues in her speech. There is no need for any child in the UK to live in poverty. The only thing that is lacking is practical action. A recent report by the Select Committee on Scottish Affairs showed that child poverty levels are at a historical high in Scotland, with 30 per cent. of children living in families whose income fell below the commonly used poverty line of 60 per cent. of median income.
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