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The Financial Secretary to the Treasury (Mr. Stephen Timms): I bid you a warm welcome to the Chair of our Committee, Mr. Key; I look forward to the debates ahead. The hon. Member for South-West Bedfordshire helpfully prompted an interesting debate, which has taken us to the heart of the question, “What is the Bill for?” I entirely accept that the amendments are well meaning, as the hon. Member for Northavon said, but if agreed to they would detract from the Bill’s clarity of purpose, as others said.
The opening debate is a good opportunity for that clarity to be achieved. We can be straightforward: the Bill is about tackling poverty—income poverty and material deprivation. Our aim is that children in the UK should not live in poverty, so the Bill deliberately has a tight focus on income and material deprivation. The reason for that is the evidence of poverty’s impact on children’s lives—on their experiences now and on their chances for the future. The evidence is clear and is set out in some of the documents to which the hon. Member for South-West Bedfordshire drew attention. Poverty blights children’s lives: it impacts on their education, health, social lives, relationships with their parents—sometimes on the relationship between parents—and future life chances.
Mr. Gauke: In the light of what the Minister has just said about income poverty, can he explain why over the past three years the Government have not increased the level of tax credits necessary to meet their 2010 child poverty target?
Mr. Stuart: Will the Minister give way?
Mr. Timms: Let me make a couple more points and then I shall gladly give way to the hon. Gentleman. I want to comment on what he said. I sensed from his remarks that he was arguing that income poverty may not be that important, and there are other things that may be important. Of course there are other important things, but the key to the Bill is the conviction that income poverty—living below the poverty line—for children should end. That strong conviction drives the Bill, and I hope the hon. Gentleman accepts that.
Mr. Stuart: The Minister is right to say that income poverty is a blight. Those outside the House will find it extraordinary that the Government oppose an amendment that would ensure that such a Bill puts the causes of child poverty—the broad basket of issues that successive Governments have signally failed to tackle—at its heart. Instead the Government fixate on income only, and thus do not ensure that the broader range of issues is tackled. The amendment would at least ensure that the causes of poverty are at the heart of the Bill—not just the quick fix that the Government are not even prepared to employ for next year’s target of more tax credits.
Mr. Timms: People listening to and reading the debate will be much more likely to agree with my hon. Friends the Members for Amber Valley and for Regent’s Park and Kensington, North: poverty is an overriding concern. As others have said, it is right for the Bill to focus tightly on that concern, rather than on lots of things. The amendment suggests that instead, the Bill should cover a wider range of policy areas and set targets through regulations on a wide range of outcomes relating to child poverty. It is true that they relate to child poverty; they are not irrelevant or unrelated and it is important to tackle them. Indeed, there are Government proposals and measures in place to tackle them, and there are targets, but we should not have targets in the Bill. That would water down the bright spotlight on poverty, which is the Bill’s great strength.
John Howell: I am slightly confused by that argument. The Minister has already admitted that the Bill contains not just income targets but targets relating to material deprivation, so surely that already widens the Bill. The problem is the evidence given by Neil O’Brien that the material deprivation data are not solid. Why have an imperfect definition outside the income ranges for those targets when we could have a better one?
Mr. Timms: As others have said, there is not a single number that tells us about poverty. That is why we have taken the view, which has been widely supported by those who have looked at this issue, that there should be four measures, all four of which I would defend. The hon. Member for Northavon indicated that he will take a contrary view on at least one of them. All four measures are about poverty, how much income people have, how much they are able to buy and whether they suffer from material deprivation. That focus is clear. I will resist suggestions that we ought to water that down by looking at a load of other things as well.
Mr. Gauke: Will the Minister give way?
Mr. Timms: Let me make one more point on this issue. I am not sure that the amendments would result in a broad strategy to tackle child poverty, as has been argued. The target should cover our ultimate goal—the outcome that we seek to achieve—not the range of policies and other topics likely to be addressed as part of an effective strategy.
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The strategy needs to be multifaceted if we are to end child poverty, but specifying targets, and specifying measures for a range of policy areas, would reduce its effectiveness and result potentially in a focus on those eight areas, rather than other things which equally need to be addressed. It is a pretty selective list. A much better approach would be to ask, what are we trying to achieve? We are attempting to achieve the eradication of child poverty. That will be our target.
Mr. Stuart: Will the Minister give way on that point?
Mr. Timms: I will give way first to the hon. Member for South-West Hertfordshire.
Mr. Gauke: The Minister is generous, as ever. I seek clarity on his approach to tackling child poverty. It seems that there was a stage when the Government argued that the way to reduce child poverty was simply through better benefits and tax credits and such transfers of resources. In recent years the Government’s emphasis has been more on tackling what we consider the long-term causes of poverty. It is not clear from what the Minister has said today quite where he stands. Does he believe essentially that the child poverty target set out in the Bill will be met by transfers of resources, such as tax credits and child benefit? Or does he believe it is about addressing what we would consider the causes of poverty? What is his position?
Mr. Timms: It will need to be both. Given the substantial investment in education, child care, Sure Start centres and other public services over the past 10 years, we will benefit in the coming decade more than in the past, simply because that investment and those services are now in place. Some of the children who benefited from that investment will have their own children by 2020.
Mr. Timms: We have, of course, seen significant improvements in education standards in primary schools. Many more young people leaving primary and secondary school are achieving—
Mr. Stuart: That is hotly disputed.
Mr. Timms: I do not think it is hotly disputed. The evidence is actually very clear. We have seen substantial gains, including progress in reducing the incidence of teenage pregnancy.
The child poverty strategy will set out the specific actions that need to be taken. The development of the strategy will identify those groups of children most at risk of being in poverty, including particularly vulnerable groups, and the underlying causes of poverty: the kind of things set out in the amendments. Annual reports will enable us to monitor progress, tracking a wide range of indicators. I imagine those indicators are likely to change, as circumstances change over the coming decade. The ultimate goal— the end of child poverty—will be unchanged. It is right that that should be at the heart of the Bill.
The hon. Member for South-West Bedfordshire mentioned the publication of “Opportunity for all”. The Under-Secretary of State for Work and Pensions, my hon. Friend the hon. Member for Bishop Auckland wrote to Members of the Committee late yesterday about that, to set out that the Department for Work and Pensions is considering what form in which to continue publishing that information. The data are included in other documents, such as annual departmental reports, reports on public service agreements and so on. My hon. Friend is considering the issue at the moment, recognising the interest that there is and has been in “Opportunity for all”.
The Bill requires all four of the targets to be met. The hon. Member for Northavon said that perhaps in 10 years’ time someone would say, “We’ve done two of them, that’s not too bad”, but the terms of the Bill are clear—all four targets need to be hit.
I hope that the Committee will accept that it is right for the Bill to have the tight focus on poverty—no ifs and no buts—and that the hon. Member for South-West Bedfordshire will withdraw the amendment.
The principle definition that we use is shifting people from below 60 per cent. of median income to just above. An analogy that I often use is that if one of us were to knock on the door of a home in our constituency and find a family in which income had moved from 58 per cent. of median to 61 per cent., Ministers would claim that that was a family taken out of poverty. They would be correct in a purely statistical sense—that is what would have been achieved according to the Government terms. However, if we sat down and spent some time with that family, we would probably be told that, yes, they did have a bit more money, which was important and for which they were grateful, but that the deep-seated problems that led to ongoing difficulties in their lives were still there. New clause 3 and amendment 59 try to deal with the issue.
To make a further point to the Minister, in 1987 the rate of child poverty was 23 per cent., as it was in 2007, the last year for which we have figures. Over a 20-year period the rate has not shifted much, so it is time for a new approach. I shall seek to divide the Committee on amendment 59.
Question put, That the amendment be made.
The Committee divided: Ayes 5, Noes 11.
Division No. 1]
AYES
Baron, Mr. John
Gauke, Mr. David
Howell, John
Selous, Andrew
Stuart, Mr. Graham
NOES
Barrett, John
Blackman, Liz
Buck, Ms Karen
Goodman, Helen
Keeble, Ms Sally
Mallaber, Judy
Morgan, Julie
Mudie, Mr. George
Reed, Mr. Jamie
Timms, rh Mr. Stephen
Webb, Steve
Question accordingly negatived.
Steve Webb: I beg to move amendment 21, in clause 1, page 1, line 11, at end insert—
‘(3) The Secretary of State shall also ensure that interim targets for child poverty are met in relation to the United Kingdom in the financial year beginning with 1 April 2015, where such interim targets are specified by the Child Poverty Commission.’.
The amendment seeks to put into the Bill an interim target, which is halfway between now and the target date or, alternatively, three-quarters of the way from when the promise was first made about 10 years ago. Given the length of our previous debate, I shall endeavour both to be brief and to encompass any remarks that I might otherwise have made on a clause stand part debate, which may be a position shared across the Committee.
On the 2015 targets and why we might want them, one of the worries about where we are in 2009-10 is the economic situation. We will be going through a difficult five-year period, when the public finances will be in a mess and we may even have legislation to put them on an even keel, so it will be hard to make much progress in the next five years, frankly. When there was, on the face of it, plenty of spare Government cash—we can debate whether there was—it was relatively straightforward, when the economy was growing rapidly and things looked good, to find money to boost tax credits. Even in those halcyon days, as they now seem, we could not meet the targets.
We missed the five-year target and we missed the 10-year target by more, so it is not hard to see that the next five years will be more difficult than the preceding 10 and, therefore, pro rata we will miss the 15-year benchmark by even more. One option says, “Well, that doesn’t matter because the only number that matters is 2020. We’re going to have rolling reports and the child poverty commission will tell us how we are getting on and there will be pressure to keep on track, so we don’t need to worry.” It is true, obviously, that we have not had a child poverty commission for the past 10 years, so we have not had that external discipline. The worry is that the momentum, such as we have had bearing in mind that child poverty has risen for the past two years, will be lost irreparably in the next five years.
We may get to 2015 even further behind schedule and it will have become impossible to hit the 2020 target. At that point, the legitimate concern about the Bill as a whole becomes relevant: if we do not have the interim target to keep us on track, we run the risk of running round pulling the only lever available to us, which is income transfer. In a sense, that is a comment for a stand part debate. One reason for a 2015 target is to say, “We need to act now to deliver in 2015”, so we do not get to 2015, miss the target, have no enforcement mechanism and realise that the only thing that we can do is rely on cash transfers, which, although a very important part of the mix, are clearly not the whole story. We have just had that debate.
The 2015 target is a valuable interim target. The Minister may say that the Secretary of State will give us three-year strategies reflecting on progress to date, and the child poverty commission will tell us, advise us and do all the rest. That would have some force if we felt that the child poverty commission had real clout. Obviously, we will debate in greater detail the clout of the child poverty commission, but it is relevant here because I am concerned that it is a weak institution compared with other analogous bodies, such as the Low Pay Commission—the minimum wage recommendations of which Governments have great difficulty ignoring—and the Committee on Climate Change, which has had a huge influence already and even before it existed had a huge influence in shadow form. The child poverty commission will be 14 people meeting four times a year, plus two members of staff and a hired meeting room. That is it. The idea that it will hold a Government to account for what the regulatory impact assessment says is £400 billion of spending over 10 years is implausible. We need a body with more teeth.
The amendment gives us a binding interim target. What that should be is clearly a separate question. There is an argument that it should not be half the distance between here and there, because some investments are longer term and will yield fruits later in the decade, but we need to be explicit and transparent. That argument could become a great get-out clause for the next Government, who could say, “We’ve sown all the seeds but you will not see the fruit till 2018 or 2019, so don’t worry about the fact that we are miles away from our target in 2015, it’ll be okay.” If we can do all those things by 2020 but they will not flower by 2015, let us be explicit, transparent and accountable.
To sum up, we have not had a statutory target hitherto. The Bill gives us one at the end of the period, but we will not know if that has been achieved until 2022 or some time, so the worry is that we have no real toothy accountability.
 
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