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What the poverty figures show

Rising poverty among working age adults reflects the recession's impact, says Julia Unwin

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The new Households Below Average Income (HBAI) figures show a small fall in child poverty and a slight fall in pensioner poverty. Although early progress in tackling child poverty under the Labour government was not sustained, for pensioners improvement has been more consistent.

Rising poverty among working age adults, including a rise of 300,000 in 'absolute' poverty in one year, reflects the recession's impact. There is a longer-running theme of rising poverty, particularly among childless adults. Poverty for both pensioners and children is higher among some ethnic groups, Pakistani and Bangladeshi households in particular.

Our research suggests child poverty could rise again, to 3.1 million children by 2020. This should be a serious worry for all political parties, with high levels of child poverty costing the country at least £25bn a year.

Arguments about tackling child poverty haven't changed much with the new government. Get more parents into work. Lower poverty. Reduce the welfare bill. Given that pensions easily form the largest proportion of welfare spending, and the amount spent on benefits for out of work adults is much smaller, such arguments may owe more to rhetoric than reality. For many people, paid work fails to reduce poverty. This must change. Jobs must be sustainable, decently paid (or leading to higher pay) and be able to be balanced with family responsibilities. But low income families too often find none of these are the case.

The new government needs to address some deep-seated issues:

The benefits system

Moving into work can still be difficult, with major problems for people who go in and out of work. Last year Ian Duncan Smith's think tank, the Centre for Social Justice, made some radical proposals (Dynamic Benefits: Towards Welfare That Works), including much bigger earnings disregards and better benefit tapering. But they come with a price tag.

Childcare

The government coalition agreement supports free nursery care for a range of providers. But it says nothing about improving overall availability, affordability or quality.

Skills

Improving skills is important. But better skills don't necessarily lead to better jobs. That can only happen if those jobs exist, in the right places and on a basis allowing parents to do them.

Encouraging more family friendly, flexible jobs

The coalition agreement includes extending the right to request flexible working to all employees and promoting flexible parental leave. Good first steps, but they are unlikely to provide the culture change needed.

Addressing low pay

Minimum wage and living wage policies are vital here. The London Living Wage and public sector fair pay review suggests government interest. Apart from anything else, the cost of using tax credits to subsidise low pay may be on the minds of those tasked with reducing spending.

But the plans seen so far are nowhere near enough to transform the employment prospects of low income families. And that is what is needed if we want to control the welfare bill without creating a new, devastating, era of poverty.

• Julia Unwin is chief executive of the Joseph Rowntree Foundation jrf.org.uk

http://www.bbc.co.uk/news/uk-politics-1878688311 July 2012 Last updated at 03:21

Poverty target will not be met by 2020, says Milburn

Families are currently considered to be in poverty if they are on less than 60% of the median income

The UK has no chance of meeting its target of ending child poverty by 2020, the government's adviser on social mobility has said.

Ex-minister Alan Milburn said officials must "come clean" and admit the aspiration, first adopted by the Labour government, would not be realised.

He told MPs that £19bn would have to be spent to achieve the goal.

The UK failed to meet a target to halve child poverty by 2010 although numbers have fallen to a near 30-year low.

The government defines child poverty as children living in homes taking in less than 60% of the median UK income.

The 2020 target of eradicating child poverty was agreed by the Labour government in 1999 and enshrined into law in 2010. It was accepted by the coalition when it took power.

But Mr Milburn, who was health secretary under Tony Blair, told the Commons education committee that current trends indicated that the earliest that this could be achieved would be 2027.

'Moment for honesty'

To do so seven years earlier would require the biggest redistribution of income in history, he told MPs.

"The only way we're going to hit the 2020 target is if one or other political party commits to what I don't think any of them are going to do.

"I think there is a moment for honesty here. I think it is time for all the political parties to either put up or shut up.

"I don't believe, frankly, that there is a snowball's chance in hell that we will hit the 2020 target. I think that's very widely privately acknowledged and I think it should be publicly acknowledged too. It is time to come clean about this stuff."

The number of children living in poverty fell by 300,000 to 2.3 million in 2010-11, which campaigners said was the lowest level since the mid-1980s although 600,000 below the amount required to meet the 2010 objective.

The reduction was due to a drop in median household incomes - since the poverty measure is based on median incomes. The median - the middle figure in a set of numbers - for 2010-2011 was £419 a week, down from £432 the year before.

'Deep poverty'

Mr Milburn, who has been advising deputy prime minister Nick Clegg on social mobility, has been nominated by the government to be the first chairman of the new Social Mobility and Child Poverty Commission.

Despite the best intentions of ministers, he said the weak state of the economy and cuts to public expenditure meant it was not an "auspicious time" to try to accelerate progress on child poverty.

The government, he added, should focus on helping the 800,000 children under five living in "deep poverty" by increasing investment in early years education.

Ministers say poverty should not be calculated purely in terms of income and that problems such as unemployment, family breakdown and addiction should be taken into account.

Speaking last month, Work and Pensions Secretary Iain Duncan Smith said Labour's strategy of spending money on benefits to try to push families above the poverty line had failed.

He said the government's consolidated universal credit - which will replace a series of benefits and tax credits - would pull the "vast majority" of young people out of poverty if at least one parent worked 35 hours a week at the minimum wage.

Comments

Bottom of Form 2

Comment number 237.

Many posters seem be under the misapprehension that as long as children don't live (die?) naked, barefoot and starving on the Streets then there is no child poverty.
Fact is that the government has set a benchmark level for poverty to eradicate and are failing to meet it. This is not a third world country ... yet.

Bottom of Form 4

Comment number 164.

I think the use of the word "poverty" is misleading. The aim is to reduce income inequality by raising the lowest incomes closer to the median. This is a laudable goal, but perhaps should not be described as the elimination of "poverty", which I have always understood to mean barely having the means to survive.

Bottom of Form 6

Comment number 120.

What if the kids who live in "poverty" are only affected by financial aspects but grown up to be well rounded, loved, educated and socially aware individuals?
Im sure there are plenty of kids that come from households that earn 60% above the national average that barley see there parents and grow up with problems associated to it.
Money isn't everything...especially to kids!!

Bottom of Form 8

Comment number 62.

When no child in this country dies of starvation, lives in cardboard boxes on the street, wanders the streets dressed only in rags or cannot attend school though inability to afford it or requirement to work fulltime to support the family , then we shall have eradicated child poverty.
Job is already done - things can always be improved, but society has already done its part.

Bottom of Form 10

Comment number 60.

We live in a first world country, where those who do not have the means to support themselves are looked after by those do, where the sick, disabled and terminal are looked after and provided with medical interventions and medication for which they do not have to pay for at the point of access or delivery. Therefore, can we please stop referring to child poverty in this country

http://www.bbc.co.uk/news/uk-1843679514 June 2012 Last updated at 14:47

Child poverty down as household income drops

The number of children living in poverty in the UK fell by 300,000 last year as household incomes dropped, official figures have revealed.

In 2010-11, 18% of children (2.3 million) lived in households classed as below the poverty line - a 2% drop.

This was because the measure is based on median incomes which also went down.

The Children's Society welcomed "the lowest poverty level since the mid-1980s" but said that may be reversed by "drastic cuts to support and services".

The government, meanwhile, says drug addiction, homelessness and unemployment should be considered as well as income when defining child poverty.

UK income drop

The government's Households Below Average Income statistics define child poverty as children living in homes taking in less than 60% of the median UK income.

The median - the middle figure in a set of numbers - for 2010-2011 was £419 a week, down from £432 the year before.

As a result, the level of household income which defines "in poverty" fell from £259, in 2009-2010, to £251 a week, the following year.

The BBC's Mark Easton said that explained why 300,000 fewer children were classed as living in poverty.

A fall in income throughout society in tough economic times has meant that thousands of families have been lifted above the poverty line without their circumstances changing at all.

The figures show ministers have a long way to go to meet a target set by the previous Labour government - and enshrined in the 2010 Child Poverty Act - to eliminate poverty by 2020.

And they mean a target set by Labour 10 years ago - when 3.4 million were living in poverty - to halve that figure by 2010/2011 was missed by about 600,000.

The Children's Society said that, while action since 2000 had "pulled 1.1 million children out of poverty", current levels were still "a scar on our national conscience".

Case study

Jessica May lives with her disabled husband and one-year-old son in a rented home in Coventry.

Despite struggling financially, she questions the current definition of poverty.

"Compared to where I grew up in South Africa, people here are ridiculously wealthy.

"In Africa if you do not work, you do not eat. It is normal to see children walking to school without shoes on and digging for food in the dustbins.

"Poverty there is also the fear that you are replaceable if you do not turn up for work. There is no protection.

"The British government want to change the way poverty is measured, but if you choose to buy alcohol or drugs, you choose to put yourself into poverty.

"The poverty we live under is mental poverty, not true poverty."

"It is shameful that over the coming decade this progress is likely to be reversed by the government's drastic cuts to support and services for the country's most vulnerable children and families," chief executive Matthew Reed said.

Save the Children chief executive Justin Forsyth said the government should focus "not on changing definitions but on policies that work, like the living wage, affordable child care and on early education programmes targeted at low-income families".

The Joseph Rowntree Foundation said "breaking the crippling low pay, no pay cycle that keeps so many working families in poverty would be a welcome start".

Work and Pensions Secretary Iain Duncan Smith said the government remained committed to the Child Poverty Act targets but that it was "increasingly clear that poverty is not about income alone".

Speaking at a community centre in London, he said it was "perverse" that "the simplest way of reducing child poverty is to collapse the economy".

He said a consultation later in the year would look at new ways of measuring child poverty taking into account problems like unemployment, family breakdown and addiction.

"Unless we find a way of properly measuring changes to children's life chances, rather than the present measurement of income alone, we risk repeating the failures of the past," he added.

He said Labour's strategy of putting "vast amounts of money" into benefits to try to push families above the poverty line had failed.

He pledged the government's universal credit - which will replace a series of benefits and tax credits - would pull the "vast majority" of young people out of poverty if at least one parent worked 35 hours a week at the minimum wage. The figure would be 24 hours for a lone parent.

Labour shadow work and pensions secretary Liam Byrne, meanwhile, said: "Behind [Prime Minister David] Cameron's promises we learn today that those parents and their children will now be abandoned and told, 'you are on your own'."

Comments

Bottom of Form 2

Comment number 67.

When I were kid! 8 of us in the house - no central heating, double glazing, TV, car, fridge, washing machine or telephone. Coal fire, radio and lino. We were not considered to be poor. Poverty in the UK is mainly a social construct except in a very few cases. These statistical contortions only prove it.