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27 Feb 2008 : Column 291WH—continued

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Earlier, several Members touched on the specific issue that I shall concentrate on today: the link between disability and child poverty, which applies all over the world. I hope that the Minister will address some of the relevant issues, as some people have a constant battle every day of their lives and would like to be entitled to the same opportunities that the rest of us take for granted. While we debate today how best to meet the ambitious targets on child poverty, the link between child poverty and disability is a key area that warrants our attention. Indeed, the Government themselves have rightly noted that the 2020 target will be achievable only with targeted help for disabled children and their families.

Disability is both a cause and a consequence of poverty and the link between the two is so strong that policy makers simply cannot afford to ignore it. To tackle it, however, we need a better understanding of why that is the case. I commend the work of the Child Poverty Action Group, Contact a Family and the Every Disabled Child Matters and End Child Poverty campaigns, all of which have played a key part in doing that. According to conservative estimates, there are at least 770,000 disabled children in the UK, although it is likely that there are more than 1 million children living in poverty and affected by disability. A quarter of all poor children have a disabled parent.

On top of the broader social and economic reasons behind child poverty that we have discussed so far today, disabled children face a number of other challenges. Perhaps the most obvious is that they are more likely to live in poverty simply because the incomes of disabled households are 20 to 30 per cent. lower than the income of the average household.

The Government will rightly be commended for recognising the need to re-evaluate the support provided to disabled children, and indeed much has been done. However, there are genuine concerns about the way the current system operates, and a number of changes are necessary to help us to break the link between poverty and disability. I would particularly welcome the Minister’s view on Monday’s forthcoming announcement about the independent living strategy, and the impact that she anticipates it will have on the matter.

At present, a key tool in the context of disability and child poverty is the disability living allowance. When it works it is effective, but there are too many problems; there is too much distrust of the system, too great a lack of awareness and too many other things outwith the scope of today’s debate. Disability living allowance is not having as big an impact as it might. If we are to have any chance of meeting the 2010 target we simply have to do more specifically to target disabled child poverty and to give better support to disabled children and their families.

Child poverty is a national disgrace and a global disaster and is all the more tragic for being preventable. Poverty and disability often go hand in hand, but the link is not inevitable and it will have to break if we are to have any chance of meeting the child poverty targets that we all want to be achieved.

3.23 pm

Dr. Roberta Blackman-Woods (City of Durham) (Lab): I congratulate my hon. Friend the Member for Slough (Fiona Mactaggart) on securing this timely debate.

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In 1997 the UK had the worst rate of child poverty in Europe, and one of the worst of any industrialised nation. In 1999 the Government set what is widely recognised as a very ambitious policy objective—to eradicate child poverty within a generation—which was reiterated in the children’s plan published by the Department for Children, Schools and Families in December 2007. As I understand it, the target of halving child poverty by 2010 and eradicating it by 2020 remains intact.

It is worth remembering, especially in the light of what I shall say, that through investment in support of children and families the Government have stopped the long-term trend of increase in child poverty, and by April 2009 the poorest families will be an average of £4,000 a year better off. That has meant a reduction of 600,000 in the number of children living in relative poverty in the UK, which is the biggest reduction in any EU country during the period. In the north-east, my region, child poverty has fallen by a massive 26 per cent. However, 31 per cent. of children still live in poor households, which is obviously much too high.

Despite the general downward trend of child poverty, the most recent figures show only a levelling off, or even a slight increase. The Joseph Rowntree Foundation has noted that changes to the child tax credit announced in the previous Budget might lift another 200,000 children out of poverty by 2010, but that would still mean that the Government were falling massively short of reaching the 2010 target. The Institute for Fiscal Studies, which my hon. Friend the Member for Slough mentioned, has estimated that between £3.8 billion and £4 billion is necessary to achieve the target.

The key policies that have been used to reduce child poverty—redistribution of income through the tax and benefits system to provide a safety net for the poorest families, and assistance to make work pay—have been successful so far, but the charity Barnardo’s now believes that those policies will produce diminishing returns, because the families that have so far been lifted out of poverty have been the easiest to reach. We know that the families still experiencing poverty are those with the most stubborn problems and the most complex needs. The Child Poverty Action Group has outlined a range of measures, including increasing child benefit, tax credits, getting more reliable child support through to lone parents and a fairer and more equitable tax system. I am keen to hear what the Minister thinks about those measures, and whether the Government intend to look at the CPAG proposals in detail.

There was discussion earlier of universal services, so I shall mention free school meals. Families living on low incomes have huge financial pressures: rent, council tax, utility bills, debt and social fund repayments. The most flexible part of the budget is often food costs. Before the Liberal Democrats took over and stopped it, Hull had a scheme for universal free school meals. There could be enormous benefits from that for all children in helping them to concentrate at school and learn social skills, but it would be excellent if the Government commissioned some research and perhaps set up some pilots to examine the impact that universal free school meals could have on reducing child poverty.

3.27 pm

Kerry McCarthy (Bristol, East) (Lab): I join other hon. Members in congratulating my hon. Friend the Member for Slough (Fiona Mactaggart) on securing
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the debate. I obtained a similar debate about a year ago and the turnout has roughly tripled since then, which shows the extent to which the issue is now firmly on the political agenda. I welcome that.

Because of the time constraints I want to make just two brief points. First, considering the issue in the context of what the Government are trying to do, particularly through the Department for Work and Pensions, in encouraging more people to get into work, good work is being done on moving people from incapacity benefit into work, and moving lone parents into work. Several other hon. Members have made the point that such movement into work is crucial to tackling child poverty. However, we must make sure that where those measures relate to families with children there is always a child-focused element to them.

For example, the provisions on lone parents having to start work when the youngest child reaches 12 will be introduced later this year—eventually the requirement will be to start work when the youngest child reaches seven. If we do not get the “better off in work” calculations right, or if for example child care arrangements do not stack up, the child will be the one who suffers if sanctions are introduced. I accept that conditionality per se may not be a bad thing, but we must make sure that we do not punish the children because of the parents. Often it is through no fault of their own that the parents are not working. It is not that they do not want to, or that they are undeserving in any respect; it is just that they cannot make all the elements of going back to work stack up. We must make sure that sanctions against the parents do not result in suffering for the children. That is a note of caution that I want to sound.

Secondly, like other hon. Members who are present, I was at yesterday’s launch of Save the Children’s book “Why Money Matters”, which clearly makes the case that, for most children who are living in poverty, household income has a huge impact, not just on the household’s resources but on such things as educational attainment, health and the child’s development.

I welcome the fact that the Government, by having the Department for Children, Schools and Families take a lead on the child poverty issue, are looking at the wider picture. I particularly welcome the Families at Risk review, because all of us who have people coming to our constituency surgeries know that some families have a multitude of problems. It is not just about the fact that there is not enough money coming into the household; there are other issues.

For example, I think that there are about 250,000 to 300,000 children for whom a parent is a problematic drug user. There are also issues associated with parents who are serving prison sentences and there are parents with mental health problems. It is estimated that families in that situation—where they face a number of problems—often deal with eight to 10 agencies in trying to sort out their problems. Therefore, I welcome the fact that the Minister is taking a lead in looking at a whole family-based approach and is not just looking at income.

3.30 pm

Annette Brooke (Mid-Dorset and North Poole) (LD): May I also start by congratulating the hon. Member for Slough (Fiona Mactaggart) on securing this important
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debate, as we rapidly approach the deadline for the target of halving child poverty by 2010 and also the forthcoming Budget?

A number of organisations must be congratulated on their ongoing campaigning work and I would also like to mention in particular the launch yesterday of “Why Money Matters” by Save the Children, which I was pleased to attend. This has been a wide-ranging debate and in my short contribution I cannot touch upon everything that I would like to, or answer certain points that were made. However, I shall do my best to achieve a wide coverage of the issues.

It is generally accepted that progress has been made by the Government on child poverty targets and we congratulate them on that. We also well remember how rapidly child poverty grew in the 1980s. However, it is clear that more action is needed if both the 2010 target and the longer-term goal of eradicating child poverty by 2020 are to be achieved.

Changes to the benefits and tax credits for families with children have helped to lift a substantial number of children above the poverty line. However, it seems to be a great irony that the policy of tax credits and the complexity of the tax credits system have plunged some families into poverty when they have been overpaid and that money has subsequently been clawed back, sometimes in a very unsympathetic manner. There are also the complexities of the child care element of the working tax credit; I saw today on the website that the guide to that alone is 23 pages long. We need reform and simplification in those areas.

The expansion of child care provision and other policies aimed at reducing the number of out-of-work families has undoubtedly had a positive impact on reducing child poverty. However, as has previously been said, the latest figures tend to show a rise in the number of children living in poverty. I think that it has always been known that, while some families needed only a small change in circumstances to take them out of poverty, the more marginalised families living in persistent poverty would be much harder to reach.

In fact, we have noted today that half of the children living in poverty come from working households. Clearly, there is a need to make progress towards higher-paid work and sustainable work, via education, training and mentoring, as well as by making work pay and making it beneficial for lower-income families. Clearly, there are costs for entering the labour market and we need to look at those.

With the change in policy that requires lone parents with older children to register for work, the extended school programme, which is already operating well, will continue to be important, as are the issues of affordability and parents applying for the tax credits for which they are eligible.

The poorest pay proportionately more tax than the rich and I would like to see some changes in that regard. For example, council tax should be replaced with a local income tax based on the ability to pay.

We have commented today on the “poverty premium” and I am sure that there is more that we can do in that regard across a range of items, particularly utility bills. We have also spoken about securing credit, which is a real drawback for those poorer people who are financially
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excluded. They pay higher rates of interest, which only increases poverty. Reform could be made to the social fund to make it more accessible to those who need it most. We must also ensure that the poorest people are well advised and supported when they borrow money.

Save the Children has estimated that, at the current rate of progress, the target of halving child poverty will not be met until 2024. We have heard that various organisations have estimated that we need an extra spending commitment of £4 billion annually between now and 2010 to ensure that the 2010 target is met.

The Liberal Democrats have signed up to the child poverty targets, but we were concerned that there should be policies in place showing how those targets might be reached. One policy that we have in place is increasing child benefit, raising it to £5 a week through the elder child rate, which would reduce the number of people living in poverty by 400,000. In due course, we would make further investment in improved child benefit, directed at second and subsequent children, to help to remove larger families from poverty. We would also invest more in the child tax credit and, crucially, we would improve its administration. Furthermore, many benefits available to poor families have poor take-up rates and I feel that we could do much more to improve those rates.

My hon. Friend the Member for Edinburgh, West (John Barrett) has already said that families with disabled children remain disproportionately likely to be in poverty and he has mentioned a number of the things that we desperately need to do to improve that situation. Of course, anyone with a disabled parent in the family has an increased risk of poverty.

There are other groups, besides families with disabled children, that are most likely to suffer from poverty: large families; black and ethnic minority children; Travellers’ children; children leaving care; and asylum seekers. Children in those groups are the most socially excluded children and are faced with inequality and poor social mobility. Those are issues that we must address if we are going to reduce child poverty permanently.

We can talk about the extra spending that we need, but to have a sustainable reduction in child poverty entails breaking into that vicious cycle of deprivation and inequality. That cycle means that children growing up in poor families are far more likely to be poor themselves. Britain consistently performs poorly in studies of social mobility by the Organisation for Economic Co-operation and Development, and, of course, we also had the UNICEF report last year, in which the UK came bottom.

There is a strong relationship between family income and educational attainment, which indicates the desperate need to form policies aimed at tackling inequality across society. That involves targeting funding at the poorest, most disadvantaged sections of society in order to improve opportunities for all.

The Government have made considerable investment in Sure Start, but the latest evaluations are showing that the most disadvantaged are not being reached. The Liberal Democrats would like workless families to receive more support with child care, because that would be a way of providing extra early years provision and thereby breaking into that cycle of deprivation that I referred to earlier. We also propose a pupil premium, which will attach additional funding directly to pupils who are
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identified as disadvantaged. That funding will follow the pupil to whichever school the pupil attends.

It is well documented in the 2007 UNICEF report that the Scandinavian countries scored highly on all measures, including those dealing with child poverty, in contrast with the UK. So what can we learn from those countries? They have a high proportion of single parents, but a high proportion of them are in work. There must also be lessons that we can learn from them about how to avoid disincentives and how to make it easier and more beneficial for parents to work. Scandinavian countries clearly have a high degree of transfer of earnings between rich and poor and they have high-quality child care, including good early years services and family centres.

Poverty affects so many aspects of a child’s well-being: health, cognitive development, achievement at school, aspirations, relationships and employment. We must identify the action that can be taken quickly to combat poverty. I think that it was alluded to earlier in the debate that it would be a very good idea to have “poverty-proofing” of all new measures. I would like to ask the Minister: to what extent has that been considered?

3.38 pm

Tim Loughton (East Worthing and Shoreham) (Con): I add my congratulations to the hon. Member for Slough (Fiona Mactaggart) on securing this debate and also on her frank exposition of some of the problems that are still facing us on the very important issue of child poverty. It is good to see a good turnout from both sides of the House for the debate.

The hon. Lady made some interesting points about the Budget possibly being the last chance to do something about the problem of child poverty, because simply to go on as we are at present will mean that we miss out 700,000 children, as she said. I also thought that her suggestions about seasonal cash grants were interesting.

The hon. Lady began by saying that to eradicate child poverty is a bold ambition. It is a bold ambition and we need to turn it into cold reality rather than just having some of the targets that I fear have failed to be achieved in recent years. Certain matters need to be addressed, therefore, including the couple penalty, which my hon. Friend the Member for Forest of Dean (Mr. Harper) mentioned. We have to tackle the increased cost of borrowing by the poorest—my hon. Friend the Member for Weston-super-Mare (John Penrose) mentioned credit unions. We have to do something about the bureaucracy involved with benefit claims—a point made by the Chairman of the Work and Pensions Committee, the hon. Member for Bradford, North (Mr. Rooney) and repeated today by the hon. Member for Mid-Dorset and North Poole (Annette Brooke)—which means that the most vulnerable have the most hurdles to straddle when filling in forms and getting benefits that they need more than other people.

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