Researchers at the Institute for Fiscal Studies have analysed the impact on households in London of the changes in taxes and benefits due to come into effect by 2014-15:
– The increases in taxes and cuts in benefits and tax credits due to take effect between now and 2014/15 hit lower income Londoners harder than those on higher incomes. For instance they amount to 5.7% of net income for the poorest fifth of Londoners, on average, compared to 1.7% for the richest fifth.
– Roughly half of poor children and one third of children just above the poverty line are in families that report they are receiving housing benefit. Furthermore, almost 90% of all children living in families receiving housing benefit in London are in poverty or just above the poverty line.
Meanwhile, the coalition’s poverty tsar, the Labour MP Frank Field, has published his review of child poverty, The Foundation Years: Preventing Poor Children from Becoming Poor Adults. It calls for greater investment in early years education and argues that funding should be both shifted towards the first five years of children’s lives and weighted to help the most disadvantaged. It also calls for all disadvantaged children to be provided with affordable, full-time, graduate-led childcare from the age of two.
So far, so reasonable. But at the same time Field also thinks, as his subtitle implies, that we may as well give up on trying to alleviate child poverty:
The electorate is now somewhat jaundiced about the prospect of being asked to fund further huge fiscal redistribution, especially as the gains so far have been so modest both in terms of combating poverty and, more importantly, of seeing these sums translated into social progress. I, similarly, sense a wish to move from a strategy that alleviates financial poverty, however admirable, to one which is seen to tackle its root causes.
According to Unicef, however, household income is the most important factor in child inequality in the UK. Report Card Nine: Children Left Behind, which looks at child inequality in 24 developed countries, confirms Field’s view that early years are critical, and that the earlier the intervention, the greater its effect. But looking at three kinds of inequality – material, educational and health – the report finds that they tend to go together, and have a mutually reinforcing effect.
Yet in Field’s view, it’s OK to cut benefits to fund parenting support services, when both are in fact necessary. He thinks that the goal should be to stop poor children becoming poor adults, not to stop poor children being poor, and that this can be somehow be done without tackling material deprivation.
The Foundation Years doesn’t consider children in care, young carers, children living with a disabled parent, or children living in households where there’s drug or alcohol misuse or domestic violence. Field didn’t have time to think about them, apparently, though he recommends more work be done in these areas. When, and by whom, isn’t clear, given that the government will be publishing its Child Poverty Strategy in March.
Field also overlooks the problem of in-work poverty. The 13th Monitoring Poverty and Social Exclusion report by the Joseph Rowntree Foundation and the New Policy Institute has found that 58 per cent of children in poverty now come from working families. The Unicef report points to ‘the changing distribution of income and employment opportunities brought about by technological innovation, by the globalisation of markets, by the migration of manufacturing to countries with rising skills and low labour costs, and the increasing premium on high-end abilities and qualifications.’ In the face of all that, Field’s proposed universal parenting courses aren’t going to make much difference.
According to the Unicef and Rowntree reports, despite the recession, and although the proportion of children in poverty in working families has increased, the total number of children in poverty in the UK has fallen. In other words, Labour’s redistributive policies were making a difference. Yet Field insists:
It is clear that a strategy that addresses poverty by transferring income in the short term is less sustainable than one which aims to reduce the ‘supply’ of poor families by reducing the chances that poor children will end up in poverty in adulthood.
When a Labour MP writes in such terms from the opposition backbenches, what hope is there?