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I said that noble Lords were reflecting disappointment in urging the Government to do more. There is nothing new in this Bill. Nothing will be different after it is passed. I say that as someone who has watched this argument from the Beveridge lecture in 1999. I was one whose jaw dropped when the commitment was made. Since then, there has been a huge amount of activity in terms of developing the policy such as in the 2004 Child Poverty Review, which was a substantial Treasury document. In 2006, we had Lisa Harker with a very important take on what needed to be done. In 2008, we had an interesting and instructive report from the Commons Select Committee, with a plethora

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of recommendations and warning signs about what had to be done. We have had public service agreement targets and the 2002, 2004 and 2007 CSR periods. We had Opportunity for All. The noble Baroness, Lady Hollis, was absolutely right: it is a document that I read avidly and it has not really recovered since she gave up the editorship. We have had targets all over the place. Is the Secretary of State expected to resign in 2010 or 2020, whoever he or she may be, if these targets are not met? What is different about putting them on the statute book? That is an important question.

I now turn to the commission because the Child Poverty Commission is not that new either. We have been blessed with lots of experts. The Social Policy Research Unit at York, with Jonathan Bradshaw and his colleagues, and many other institutions-not just the LSE-have done marvellous, world-leading work on analysis of the problem and on offering prescriptions. What will the Child Poverty Commission add to what has been done there and in the Joseph Rowntree Foundation report, or work done by Donald Hirsch? It is world-class and I do not see how the Child Poverty Commission will find it easy to better that. It is all available free anyway, so what will the Child Poverty Commission bring that has not been available to us in the past?

One thing that I would like the commission to undertake is firm qualitative research-and no doubt we will discuss that in Committee. I am particularly worried now about some of the persistent levels of poverty in working families in the United Kingdom. I have been subscribing to and agree with the Government's active labour market policies, and I concede that the Government have done a lot. I acknowledge that, but we are now finding that there is persistent poverty in working families. That might be because there is a lot of part-time work in the system now. We need to understand that because if people think that it is safe to get people into jobs and assume that the problem is solved, they are wrong if some of these statistics are right. Maybe there is some work to be done there.

I enjoyed the speech of the noble Lord, Lord Freud. I do not know anything about iron triangles. I did O-grade geometry and there are isosceles, scalene and obtuse triangles. I do not mean obtuse to be a derogatory term because it is a type of triangle with an angle of greater than 90 degrees within it, but I will go away and learn about iron triangles as well as three-legged stools for mothers and fathers and the state. I will go away and think about all those things.

Although the noble Lord, Lord Freud, was trying to establish clear blue water between himself and everybody else, I do not think that he is that far away from us in saying that we have to produce the resources in a holistic way. I agree with him on that. He is worried about family breakdown and I know where he gets that worry from. My good friend Mr Andrew Selous is a very good thing and I am in favour of him. The only thing about which I disagree with him-he was a member of the Select Committee on which I served-is that he has this thing that families need fathers; he thinks that everybody needs to be married before the world will be right. I do not think that that

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is true. The noble Lord, Lord Giddens, made the important point that in Scandinavian countries lone-parent families are very successful, so I do not buy the idea that the vows make the difference. I think that you can support and work with family units that are less than two married people.

If the noble Lord, Lord Freud, is to address family breakdown, addiction, worklessness and the lack of educational skills, I am with him, but that needs not only a holistic approach but investment. I notice that neither he nor the Minister mentioned Clause 15, which is the get-out for any Government in the long term, as it makes all this subject to financial capability and that kind of thing. The Committee will want to drill into what that means for both major parties. If it represents a complete block on extra resources, we really are toiling.

All parties at the coming election will need to find some way of devoting extra resources to this problem, whether through the benefits system or through the more holistic approach that I think the noble Lord, Lord Freud, has brought to the table. He is an innovator. He is the man who won the argument about getting the Treasury DEL and AME rules changed. However, if it is true that you can do that in a welfare/work context, why do we not say to people who live in families that are multiply deprived and in persistent poverty, "If you can prove that for an expenditure of £X,000 you can trade your way out as a family unit, never mind the benefit that you are on"-Professor Gregg has persuaded me that it does not matter what benefit you are on-"and if you can find your way to the table, to the local authority or the Jobcentre Plus personal adviser, and say 'Look, just get me the resources, the grant or the loan that I need to become a nurse or a teacher and I can get my family into a much better place in three or five years', we will say to you, 'Come on down!'"? We should give those people the money. That is the kind of innovation that I hope we will be able to look to in the longer term.

How should we present all this? The British population hates poor people, mainly due to the Daily Mail. That is an exaggeration, but only a slight one. There is a poisonous atmosphere to the debate, which is all about "scroungers" and the rest of it. We should start changing the rules. My noble friend Lady Walmsley made an important point about the cost-benefit analyses in the IFS and Joseph Rowntree Foundation studies. We should demonstrate that by spending money early-by early investment, pre-empting some of the worst effects of the long-term disadvantage that poverty causes-we can save the taxpayer money. We will explore the figures in Committee. I defer to colleagues who know more about the human values and moral virtues of protecting the life chances of individuals who are young and need protection, as they do, but I believe that we should get a bit more realistic about presenting this debate. We should take a much more cost-benefit analysis approach and say, "We can save a lot of money doing it this way". If we did that, we would be much better able to engage public support.

I enjoyed the maiden speech of the right reverend Prelate. I understand the rurality issue. I come from south-east Scotland, where my constituency was, so it

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was music to my ears when he identified the fact that, although the needs are different, they are just as great. I hope that the Committee will have the chance to look at some of that. There are all sorts of issues in which we can get involved in Committee.

More than anything else, as a political institution that is interested in doing something in this area, we have to understand that, although money is of course going to be difficult to find, we must find ways, if we are to make any progress, of investing sensibly over the next 10 years in domestic households that are at the bottom of the social ladder. I am absolutely up for looking at new ways of doing this. There are problems with some of the Centre for Social Justice suggestions, which seem to ignore the fact that benefits are for households while taxation is about individuals. I do not yet see how those marry properly, but that is perhaps because I do not understand the iron triangle.

I was told by the noble Lord, Lord Freud, in the period between the debate stopping and starting again, the very bad news that the book is 800 pages long. It might take me until next Christmas to read that. We must all expose ourselves to any new ideas that we can find, but we must also rededicate ourselves collectively-across the House, through all parties and the Cross Benches-to finding extra resources if we are going to tackle this problem adequately.

8.30 pm

Lord De Mauley: My Lords, I start by thanking all noble Lords who have taken part in this debate. In particular, I welcome the right reverend Prelate the Bishop of Hereford to your Lordships' House. I congratulate him on his maiden speech and agree, in particular, with his emphasis on the importance of the family.

This has been a very interesting debate which has quite properly highlighted the strength of feeling that many have about the importance of reducing child poverty. As my noble friend Lord Freud made clear in his opening remarks, it is a strength of feeling that the Conservative Party wholeheartedly shares. During the Bill's passage through another place, it was sad to see many of the debates degenerate into acrimonious arguments about what did or did not happen more than 15 years ago. Before I go any further, I reiterate the Conservative Party's support for the Minister's desire to reduce the number of children growing up in poverty, and echo my noble friend Lord Sheikh in his general support for the Bill.

I am sure that your Lordships' House will debate the detailed provisions in its usual constructive manner, and that we will be able to pass a Bill that gives the Government the powers they need to make the necessary changes to people's lives. Unfortunately, the Bill is not yet there. The Bill is flawed, not in what the Minister claims it is setting out to do-we all agree with that-but in how it tries to achieve those aims.

I am very pleased, as I am sure are all other noble Lords, that the Minister responsible for piloting the Bill through our Chamber is the noble Lord, Lord McKenzie, for whom we all have the greatest respect. I hope that, since his department is keeping control of the Bill, we will see a greater appreciation of the power

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of individualised intervention, as opposed to the Treasury's often narrow-minded and ultimately ineffective reliance on financial manipulation. I hope that the Minister will be willing to see the principles on which the Welfare Reform Act was based translated into this Bill.

The noble Lord, Lord Northbourne, rightly emphasised, as did my noble friend Lord Freud, the importance of understanding the causes of poverty and addressing these directly, rather than sweeping them under the carpet and treating only the symptoms with direct financial transfers. As an IFS report commissioned by the Government tells us, it would take £19 billion a year in today's money to achieve a solution through purely financial means. Of course, that was a static analysis; it ignored the spiralling effects of encouraging more and more people to live on benefits.

Even the Government agree that this is unsustainable, especially when their own finances are in a hole to the tune of £178 billion. If the Government have failed to meet their own 2010 target after a decade of unprecedented growth, the next Government will clearly have to use different and more effective tactics to meet the targets in the Bill during the bust into which Labour's economic policies have driven us. Unfortunately, the Bill does nothing to set out what tactics this Government think should be used. It talks of creating strategies but gives no clue as to what those strategies should be. It would be interesting to hear what the Minister thinks were the flaws in Labour's policies in recent years that have led, as the noble Baroness, Lady Thomas of Winchester, mentioned, to the 2010 target being missed. What changes does he think should be made in order to do better in the future?

The Bill is also silent on many other important details that will be critical to successful implementation. There has been confusion, for example, about the intended role the commission will play. We would support, of course, the establishment of a credible body that focuses on collating and commissioning high quality and relevant research and giving unbiased and constructive advice to the Government. However, there are considerable and understandable fears that instead we will be landed with just another lobby group, this one taxpayer funded, which adds little value to government policies.

We need to explore as well how the Government envisage local authorities and partner authorities will meet their obligations under the Bill. What difference will this legislation make? Local authorities are, of course, the right place to start; poverty is very much a local problem, caused by local issues and needing locally targeted solutions. However, as my noble friend Lord Sheikh suggested, local authorities already have significant obligations on them to look out for those in their area who need support. We must make sure that these provisions empower local authorities and do not stifle them or bury them under more box-ticking paperwork.

Our most fundamental disagreement with the Bill is, as my noble friend Lord Freud made clear, that it focuses on the symptoms, not the causes, of poverty. We will seek throughout Committee to ensure that the

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measures target those experiencing genuine deprivation. As my noble friend Lord Freud said, children as a group do not generally have incomes or wealth, so we are driven to the income and wealth of their families as a proxy. However, it is a deeply unsatisfactory proxy because not all families share out their income as we would like. The Centre for Social Justice estimates that about a million and a half children are growing up in substance-abusing households, either of drugs or alcohol. That is likely to be a very substantial proportion of the children we are concerned about. What good does it do to tackle the problems in these families by increasing benefit payments? Surely that is a strategy designed in these cases to delight the local drug dealers and off-licence stores.

In order to make a real difference to these children's lives, we must be honest about those factors which lead to poverty. As my noble friend Lord Freud said, relationship breakdown, substance abuse, unemployment-the right reverend Prelate the Bishop of Hereford also referred to that-and lack of education, which the noble Earl, Lord Listowel, mentioned, are the big four causes. Although they might not cover every single example of a family struggling to bring up a child in poverty, they are certainly among the reasons for most of them. The Bill must address these causes squarely.

Nor must the Bill become a tool for whitewashing. The right reverend Prelate the Bishop of Leicester referred to the vital need to pay the closest attention to those deepest in poverty. We agree that it would be quite wrong for government to focus attention on those families who fall just under the target income levels. Indeed, I am sure that this is not the Minister's intention. However, such a flawed policy would be the most efficient way of meeting these targets and allowing a Government to present the appearance of making headway. We must make sure that the reports on these targets give accurate information about what difference the Government's policies are making to real people, not just to statistics.

As the noble Baroness, Lady Walmsley, said, the Bill must instead be targeted at those most in need. Children in care or those caring for a disabled parent, to whom the noble Baroness, Lady Hollis, referred, are often the most vulnerable and those at risk of suffering serious or persistent poverty. What is there in the Bill to make sure that, in the desire to meet an arbitrary target, those most deserving of government assistance are not ignored in favour of those closer to the 60 per cent mark?

The noble Lord, Lord Giddens, for whom I have great respect, asked what would replace targets if a Conservative Government were to abolish them. My noble friend did not say that we would abolish targets; he said that we needed the right targets. He said that we will aim to widen the agenda and build up targets that are more likely to address the underlying causes of poverty. Our debates in Committee will allow us to expand on that. I dare not, as a layman, go into the intricacies of the iron triangle, but I shall say for today that a Conservative Government would certainly seek to reduce poverty among children, but we must address the causes, not the symptoms.

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The Government have much to explain in the Bill. The noble Baroness, Lady Nicholson, asked why they are tying future Governments to a target when they have failed to meet their own, but that question has not yet been answered. I look forward to the debates in Committee, where I hope we will be able to extract considerably more detail about these provisions and persuade the Government to improve the Bill.

8.40 pm

The Parliamentary Under-Secretary of State, Department for Communities and Local Government & Department for Work and Pensions (Lord McKenzie of Luton): My Lords, I thank noble Lords for a fascinating debate and for their generally warm welcome for the Bill. I acknowledge the honest doubts of the noble Lord, Lord Northbourne, and I hope that along the way we will be able to encourage him to feel warmer about the Bill.

I congratulate the right reverend Prelate the Bishop of Hereford on his impressive and wide-ranging maiden speech and I look forward to his future contributions, some of which, I hope, will be on subsequent stages of this Bill. He talked to us about the role of the church in supporting families, and he made the telling point that setting targets of itself does not change things; those targets have to be met. I agree with that. He referred to issues around poverty of aspiration. The Bill is not only about targets; it is about strategies that should seek to ensure that all children do not suffer socio-economic disadvantage. There are fascinating issues around lone parents and how we encourage them into work and the support that we have given them in the Welfare Reform Bill which we debated not long ago.

It is encouraging to listen to the many interesting contributions to this debate. It is clear that this House, across parties, is passionate about tackling child poverty and ensuring that every child has the opportunity to realise their potential. I look forward to working with noble Lords to ensure safe passage of this measure through your Lordships' House in what we know will be a truncated Session.

I shall try to deal with as many of the points raised as I can. I shall start with the noble Lord, Lord Freud. I say to him, as he talked about figures since 2004-05, that I do not think he gave proper recognition to the measures that were announced in and since the Budget 2007 which should lift a further 550,000 children out of poverty. I will come on to some of the detail of those measures later. There is also the simulation and the work that IFS did, which predicted that child poverty would fall by more than half a million between 2006-07 and 2010-11 to around 2.3 million; so it is not right to represent that these things are mired and moving in an increased direction. The noble Lord talked about the UNICEF report and suggested that the UK performs badly on child well-being. We accept that the 2007 UNICEF report highlighted some significant challenges for children's well-being in the UK, and we are not complacent. However, much of the data used are old, with some taken around 2003 and some relating to 1999 to 2001.

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The noble Lords, Lord Freud and Lord De Mauley, suggested that in a sense our approach is all about income transfers. That is not the case. Certainly, income transfers, the working tax credit and child tax credit in particular, have been a key part of the strategy to tackle poverty and child poverty, but the building blocks set out in Clause 8 cover a whole range of key policy matters-some of which, from the noble Lord's analysis, we actually share. It is to do with employment and skills; it is to do with health and education; it is to do with childcare and social services; and it is to do with housing. It is not just about looking at income.

Regarding the iron triangle, if the noble Lord, Lord Freud, looks at the data, he will see that fewer people experience high rates of withdrawal of benefits than under the predecessor Government. I am not sure if that was the noble Lord's party at the time, but if he looks at the data, that is the case. A lot of effort has gone into making sure that work pays through things such as the national minimum wage and tax credits.

The commission is not a political appointment and the OCPA rules will apply to it. It is a genuine advisory body and I hope that the noble Lord would welcome that.

He asked why we use the 60 per cent median income measure. The Government consulted widely on the measure of child poverty during 2002 and 2003, and it was strongly agreed that income was central and that 60 per cent of median threshold is an internationally recognised standard. While other EU countries do not have statutory targets on this measure, all use this indicator as part of the annual monitoring of social inclusion undertaken by each member state.

The noble Lord and others asked why we focus only on targets around income. The targets explicitly focus on tackling income poverty and material deprivation. This reflects our aim that children should not live in poverty in the UK or suffer the effects of wider socio-economic disadvantage. Ensuring a focus on income and material deprivation is central to that. Indeed, income poverty is at the heart of the Bill because of the evidence of the impact that it has on children's lives, both in their experiences now and their chances for the future.

The noble Lord, Lord Freud, also talked about the accuracy of the poverty statistics and said that these were not a sound basis on which to be judged. The HBAI is an annual statistical series that has been running for two decades. It is a well-established comprehensive data source for estimates of poverty and measuring UK household income distribution. It complies with international best practice in measuring household income.

A number of noble Lords-the noble Lords, Lord Freud and Lord Northbourne, and the right reverend Prelate the Bishop of Hereford in particular-talked about child poverty and family breakdown, and touched upon marriage. Research shows that the quality of parental relationships and family functioning, rather than its form, has the greatest effect on children. It is just too simplistic to say that family breakdown causes poverty. Research has shown that children are at an increased risk of adverse outcomes following family breakdown. However, the difference between children

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from intact and non-intact families is small, although statistically significant. Some children can actually benefit when breakdown brings to an end a harmful family situation-for example, when there are high levels of parental conflict, including violence. Evidence suggests that although child poverty is associated with family breakdown, there is no clear causal link. It is the high level of worklessness among lone parents that increases the risk of poverty for children in lone-parent families, rather than the family structure itself.

The noble Lord, Lord Northbourne, asked when we would publish the families and relationships Green Paper. We are planning to do that later in the year; I do not have a precise date, and I cannot promise that the paper will be available in draft by the time we reach Committee stage.

The noble Lord, Lord Freud, also referred to the couple penalty. Tax credits treat couples and lone-parent households equally and are not designed to favour any particular arrangements. Lone-parent households face particular difficulties, as is evidenced by the fact that the risk of a child growing up in poverty is twice as high in a lone-parent family as in a coupled family. Arguments that the tax and benefits system disadvantages couples are too often based on simplistic comparisons that assume that a separated couple will continue to pool their income. At this juncture I shall not dwell on reinstating on some basis the married couple's allowance and on how much that might cost. However, it seems to me that any approach of that nature is most likely to produce less for the poorest in our society compared with the richest.

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