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The noble Lord, Lord Freud, and others talked about equality in income distribution. Although income inequality is slightly higher today than it was in 1997-98, movements have been small compared with the sharp increases in inequality in the 1980s. The Institute for Fiscal Studies' analysis showed that tax and benefit reforms since 1997 have clearly been progressive, benefiting the less well-off relative to the better-off. Without those reforms, inequality would have risen a good deal further.
The noble Lord chided new Labour for being friends of the rich. He may wish to know that living standards for the poorest 20 per cent of households have risen by more than 1.5 per cent a year in real terms since 1997-98, keeping pace with the incomes of the richest 20 per cent of households. In the 1980s and mid-1990s, living standards for the poorest 20 per cent of households rose by less than 1 per cent a year compared with 2.5 per cent for the richest 20 per cent of households. It does not seem to bode well to propose inheritance tax cuts for the very rich. I do not see how that will help child poverty.
The noble Baronesses, Lady Thomas and Lady Walmsley, said that a target of 10 per cent would not mean the eradication of child poverty. I suggest that less than 10 per cent is an ambitious but challenging goal for sustaining the eradication of child poverty and will put the UK's child poverty rate firmly among the best in Europe. A relative child poverty level of below 10 per cent would be the lowest in this country since at least 1961 and would more than reverse the doubling of relative child poverty between 1979 and 1998-99. I acknowledge that it is a challenging target.
The noble Baroness, Lady Thomas, talked about disability costs and equivalised income. She is right that the current low-income measure does not take into account the extra costs of disability. This is a difficult issue. We recognise that additional costs are associated with disability but research shows that these vary significantly in level and nature. There is no general agreement on how to measure these costs but perhaps we can develop these discussions further in Committee; indeed, I am sure that we will.
The noble Baroness also asked whether local strategies add up to the national target. Local action to tackle child poverty will make a big contribution towards achieving the national targets. Success in tackling child poverty requires the delivery of high-quality services to support parents into employment, increase the take-up of financial support and improve children's life chances. However, the 2020 targets cannot be achieved by local action alone; national Governments must, for example, take responsibility for the tax credit and benefit system.
The noble Baroness, Lady Thomas, and the noble Earl, Lord Listowel, raised issues concerning looked-after children and asked whether they were missing out on the measurements. The vast majority-something like 84 per cent-of looked-after children and children in care are placed with foster parents, for adoption or with their parents and so reside in private households, which will be captured by the targets in the Bill. Therefore, the majority of looked-after children will be covered.
The noble Baroness asked whether the measure should be after housing costs. There are a number of reasons why the Government have chosen to maintain a before housing costs measure in the Bill, although I noted that the noble Lords, Lord Sheikh and Lord Freud, quoted the after housing costs data. First, income is measured before housing costs to allow comparisons with other European countries that also measure poverty in this way. We have stated our ambition to be among the best in Europe and therefore such comparisons are vital. Secondly, as the noble Baroness predicted I would say, measures of housing quality are currently included in the list of items used for the combined low-income and material deprivation measure. Of course, measuring income after housing costs can understate the relative standard of living that some individuals may have by paying more for better-quality accommodation.
The noble Baroness also asked about burdens on local partners and whether we would impose a duty on local authorities which would add burdens and bureaucracy to what they already face. Fulfilling that duty need not be an additional burden. Local partnerships should already be taking action to improve outcomes for the most disadvantaged families in their areas. A number of local authorities are already taking significant strategic action to tackle child poverty.
Baroness Thomas of Winchester: My Lords, will the Minister address the issue of more resources to local authorities?
Lord McKenzie of Luton: My Lords, I was just about to say that I have a long list of support which will be made available, particularly by the Child Poverty
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The noble Earl, Lord Listowel, talked about housing. Clearly, it is one of the building blocks on which the strategy has to focus. Since 1997, when there was a £19 billion backlog of repairs to social housing and 2 million homes were below basic decency standards, some £23 billion of public and private money has been invested in improving social housing-that is up to April 2006-and over £40 billion in total will have been invested by the end of 2010, making a significant difference to the decent homes standards.
The noble Earl also referred to the importance of good quality childcare. Childcare places have more than doubled since 1997. For the first time, local authorities now have a statutory duty under the childcare Act to secure, as far as is reasonably practicable, sufficient childcare for working parents.
The noble Earl, the right reverend Prelate the Bishop of Leicester and the noble Baroness, Lady Thomas, talked about vulnerable children excluded from the targets. The targets can apply only to children for whom we can measure household income. The surveys, which will be used to measure progress, will be the best instruments available for measuring the household income of children across the UK. Although some children from vulnerable groups are not covered by the surveys, including some disadvantaged groups such as Gypsy, Roma and Traveller children, asylum-seeker children and looked-after children, no children are excluded from the surveys on the basis of status. I stress that the strategies which have to be introduced are for all children in the UK.
The right reverend Prelate the Bishop of Leicester spoke about his engagement with children and his understanding of their needs and aspirations. In part, that illustrates why issues of material deprivation and persistent poverty are part of our targets.
My noble friend Lady Hollis, as ever, produced a thought-provoking contribution, running through the targets which we have proposed and how they might apply. When incomes generally remain static or maybe decline, of course, having an absolute poverty target must mean that, if it were met, the income of the poorest would nevertheless have to increase. That is why we have the absolute poverty target.
On the point that one way of tackling poverty is to seek to ensure that benefits are uprated by more than inflation and by more than earnings, I shall run through some of the measures that have occurred in recent years. In April 2008, we increased the child element of the child tax credit by £175 a year. In October 2008, the child maintenance disregard in out-of-work benefits increased from £10 a week to £20 a week and there was a full disregard in child maintenance for housing benefit and council tax benefit at that time as well. We increased the eldest child benefit rate by £20 a week and, in April 2009, we increased the child element of the child tax credit by £75 above indexation. So in a way we are addressing some of the points that she raised.
The noble Baroness, Lady Walmsley, said that early intervention is important, and I agree. She referred to the fact that there is a risk under the targets that we focus on those who are nearest to the border-line. That is why we have more than one target and each target must be met; it is not a question of picking the target that you want. She raised the point, as did the noble Lord, Lord Kirkwood, about Clause 15. Let me be clear that the duty to meet the target in the Bill is absolute. The only way to get out of the duty is by returning to Parliament to repeal the legislation. Clause 15 is about how we meet the targets, not whether we meet them. The clause in no way mitigates a failure to meet the targets; it simply means that the Government are required to consider the most cost-effective way to reach them in order to protect the taxpayer's pocket and the wider economy.
The noble Baroness, Lady Walmsley, referred to funding for the banks. Perhaps we should not get into that debate at this hour. She talked about the independence of the poverty commission. I should stress that it is an advisory committee. Of course, it must publish its advice, and it must be consulted. Those are requirements under the Bill, so it will be plain for all-Parliament and the public-to see what advice the commission has given. As I mentioned earlier, the OCPA process will be the basis on which appointments are made. I, too, very much hope that we can get a cross-party consensus on this measure. That is important. In my opening remarks, I dealt with issues about consultation with children. Perhaps I may write to the noble Baroness about the definition of "child" and why it differs from the United Nations Convention on the Rights of the Child. It is to do with how the surveys are constructed.
The noble Lord, Lord Northbourne, said that he had doubts about the Bill because he thought that it ignored the role of parents. With great respect, I do not believe that that is the case. The Government are committed. We have not lost faith in parents, as the noble Lord suggested. During 2006-08, the Government provided local authorities with a parenting strategy support grant. That provided funding to enable local authorities to develop and implement a strategic approach to parenting support and to build on strategic approaches already in place. The Government recommend that local authorities appoint a parenting commissioner to oversee and develop that strategic approach. We have also published guidance for local authorities on developing a parenting strategy.
I think that I have dealt with the issue of the Green Paper. The noble Lord, Lord Northbourne, asked why we should focus on child poverty rather than family poverty. The Bill is about helping children in poverty, stemming from the Government's pledge in 1999, as we heard from my noble friend Lord Giddens, but supporting parents and families as well as children and young people is a central part of tackling child poverty. An effective child poverty strategy must support families by improving the employment opportunities of their parents, providing access to good quality and affordable childcare for their parents, and so forth.
The right reverend Prelate the Bishop of Hereford talked about minimum income standards. We are committed to ensuring that the tax and benefit system
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Time is moving on. The right reverend Prelate the Bishop of Hereford talked about rural poverty not being included in the strategy. Rural poverty is an important issue, as families in rural areas may face additional burdens as a result of their location or because of lack of good transport links, especially difficulties in accessing employment opportunities or services such as health, education and leisure facilities, but those are part of the building blocks that must be addressed in strategies, both local and national.
My noble friend Lady Massey again raised kinship carers. I know she is committed to this cause and I pay tribute to her. The evidence points to care by family and friends being the best approach for many children who cannot be looked after by their birth parents. We want to recognise fully the additional support needs of this group as well as the contribution that family and friend carers make to the life chances of vulnerable children. My noble friend will be aware that we held a cross-government grandparents summit to listen to the experiences of grandparents. This will feed into the families and relationships Green Paper, which is due for publication later this year, in which the role of grandparents and the wider family will be a key theme.
The noble Baroness, Lady Nicholson, made an extremely interesting contribution and challenged me for anything like a detailed reply. I should make clear that the Bill is focused on poverty in the UK, but what she said was very thought-provoking. I shall take this matter away, write further and perhaps set up a meeting with her to see how, and the extent to which, the points she raised have already been addressed or might be addressed. However, it is outwith the scope of the Bill as drafted.
The noble Baroness, Lady Blood, vividly described the downward spiral of deprivation that parts of her community have suffered. I am pleased that she welcomed the role of the devolved Administrations provided for in the Bill. In particular, she referred to difficulties on measurements of persistent poverty. So far as Northern Ireland is concerned, they particularly arise because of the problems of getting an appropriate sample size. We are looking at the Understanding Society publication, which is a more detailed study.
The noble Lord, Lord Sheikh, talked about abject failure. I simply refer him to his Government's experience on child poverty. He talked about a multifaceted approach, and I agree. He talked about the need to help people reach employment and the impact of unemployment on poverty. Again, I agree, but I point out to him that
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My noble friend Lord Giddens again challenged me with a thought-provoking contribution. He talked about the need for a more comparative analysis with other countries. We have learnt a lot from our experiences over the past 10 years, and the target has always been incredibly challenging. Experience has shown how ambitious the interim and long-term goals are. We understand the importance of assessing the contribution that a wide range of public services can make in tackling child poverty, but we also need to make sure that we understand what progress other countries have made and that that analysis is properly fed into the strategies that are being developed. My noble friend asked where the earth-moving equipment is. I think the IFS suggested that £4.2 billion would get us to the interim target for child poverty by 2010, but that amounted to something like increasing the child element of the child tax credit by about 30 per cent on top of the uprating already planned, and that is not something that we see as currently affordable. He asked whether I agree that we need more radical policy innovation. That depends upon what "radical" means. I have seen plenty of documents with "radical" stuck in the front to imbue the strategy with some aura. If "radical" is relevant and can be delivered and make a difference, then I agree.
The noble Lord, Lord Kirkwood, talked about expectations being dashed. I accept that there is a long way to go, which is what this Bill is all about. I was asked what difference the Bill will make. It will make a difference because a clear duty will be put on the Government and local government to meet targets and to produce strategies. There will be reporting obligations and obligations will be imposed on local authorities. As to what the Child Poverty Commission will bring, I believe that it will bring expertise from people who are knowledgeable in this field and can advise the Government in a way which can make a real difference.
Finally, I acknowledge what the noble Lord, Lord De Mauley, termed as general support for the Bill in tackling child poverty. I am still unclear as to what type of targets he would wish to substitute for those in the Bill, those which he would seek to remove and those which his party would not see itself to be bound by. But perhaps that will emerge from the debates in Committee. I do not think that there is confusion on the role of the commission. If there is, Committee will be the chance to understand and to iron out that confusion.
Our vision is of a fairer society in which no child is left behind and has their future life chances damaged by living in poverty. Still too many families are on the edge of coping and we should not accept that there are children and families who lack the basic needs enjoyed by so many in this country. The Government are working to tackle injustice and inequality, and to create a country where every child can grow up enjoying
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Bill read a second time and committed to a Grand Committee.
Lord Bassam of Brighton: My Lords, there are now 12 speakers in the next debate. My noble friends Lord Corbett of Castle Vale and Lady Ford are sadly unable to participate this evening. If Back-Bench Members keep their remarks to around six or seven minutes, we should be able to rise shortly after, but not too long after, 10.40 pm.
Moved By Lord Faulkner of Worcester
That the House takes note of preparations for the hosting of the 2012 Olympic and Paralympic Games in London.
Lord Faulkner of Worcester: My Lords, I am sure that even at this late hour the whole House welcomes this opportunity to note the excellent progress being made by all of the parties involved in delivering the London 2012 Olympic and Paralympic Games. I look forward with great anticipation to the contributions that will be made by noble Lords in all parts of the House who not only have so much detailed knowledge of sport and the Olympics but are also making such huge individual contributions in planning for London 2012 and in securing the legacy afterwards.
I am pleased to be able to tell the House that London 2012 continues to be on time and on budget. With well over 40 per cent of the construction programme now complete, the Olympic Delivery Authority has made outstanding progress in creating the Olympic park and venues for 2012, and already it is possible to see how dramatically the landscape of east London is being transformed. The external structure of the Olympic stadium is now complete, with work progressing on schedule. The impressive aquatics centre roof is also in place, along with the huge land bridge that forms part of the roof of the venue and which will provide the main pedestrian entrance to the Games.
The construction of the distinctive velodrome is proceeding well, while the 4,500 tonne steel outer structure of the international broadcast centre was
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It is not only what the ODA is achieving but how it is doing it that is particularly inspiring. The London 2012 big build is breaking new ground for sustainability. It will be the first major event of any sort to undertake a full analysis of its carbon footprint, with the aim of minimising emissions. The measures that have been put into place will reduce by 400,000 tonnes the amount of CO2 that is produced and will make the Games a model for future mega-events worldwide.
The Games will provide a unique opportunity to promote healthy living. As an example, tobacco and cigarettes will not be sold at any of the Olympic venues. Smoking will be prohibited in all the enclosed Olympic and Paralympic venues, and LOCOG is currently looking at how it can best provide a healthy and enjoyable environment for all visitors to the Games.
The construction of the Olympic park and venues are not only helping to provide the basis for the regeneration of east London, but have helped to create opportunities for businesses across the UK in a time of economic adversity. Contracts worth £6 billion will be directly procured by the ODA and by LOCOG, generating tens of thousands of supply-chain opportunities for UK businesses. Of the 1,000 companies that have already won more than £5 billion of work to supply the ODA, more than 98 per cent are UK-based, 46 per cent are outside London, and around two-thirds are small or medium-sized businesses.
At the end of last year, the Olympic Delivery Authority produced a nationwide snapshot of some of the British businesses that have won 2012 contracts to date. It shows that building the venues and infrastructure for the Games is truly a nationwide endeavour, whether it is a basketball arena from Glasgow or structural decking from Poole, wetland planting from Norfolk or steel reinforcements from Neath. So far, thousands of companies across the UK have taken advantage of the London 2012 CompeteFor service, which not only provides businesses with the information they need to bid for 2012-related contracts but offers them dedicated business support that can help them to win.
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