Friday, 4 December 2015

Iain Duncan Smith has a point - but it's not the one he thinks....

Iain Duncan Smith is responsible for replacing child poverty reduction targets based on household income with targets relating to ‘worklessness’ and educational attainment.  The validity of these new targets is based on assumptions that the behaviour of individuals is the major factor determining life chances rather than the wider social and economic circumstances in which they find themselves.

So why do I think he has a point?  (Even if it’s not the one he thinks it is.)

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In 2010, the Child Poverty Act was passed with all Party support, one of the last achievements of Gordon Brown’s government.  It set targets for reducing child poverty through to 2020 and imposed a duty on governments to report every year on progress towards those targets. Four measures of income-related poverty were to be used (relative, combined low income and material deprivation, absolute, and persistent) and the Act also required local government to assess levels of child poverty in their areas and develop strategies to address these.

In 2015, the Conservative government is abolishing the duty to tackle income-related poverty and replacing it with a new duty for the Secretary of State to report annually on “life chances”.  These are to be measured by the proportion of children living in workless households and educational attainment at the age of 16. In addition, the duty on local authorities to develop strategies to address child poverty is abolished, the Social Mobility and Child Poverty Commission is to be renamed the Social Mobility Commission, and measurement of progress on child poverty is removed from its remit, which is now to be entirely concerned with social mobility.

These radical changes are a result of arguments made by Iain Duncan Smith, Secretary of State for Work and Pensions, and the think tank he founded, the Centre for Social Justice. They are made despite widespread criticism, not only from Labour but from almost all academics and voluntary sector organisations working in the field. 

The Social Mobility and Child Poverty Commission concluded “that the numbers of children in both absolute and relative poverty are set to increase significantly over the next few years, with the 2020 targets being missed by a considerable distance. Nothing in the [the government’s child poverty] strategy changes this finding”.  

This of course is the point. The Centre for Social Justice argued that: 

The law that binds us to this measure must now be scrapped before it does serious damage. The legal implications of not hitting the target – or rather of not working towards hitting the target in 2020 – are becoming serious. Legal advice given to the CSJ has suggested that if it looks like the government might not reduce relative income poverty to the requisite level by 2020, judicial review could lead to the courts requiring the government to take steps to do so.

The CSJ and Iain Duncan Smith partly justify their approach with practical arguments about the appropriateness of using 60% of median income to measure poverty - a household may move out of poverty not because their income has increased but because the median level of income has fallen (as happened during the last recession); and it encourages policies which aim to get people just under the median income to move to just above -  the ‘poverty plus a pound’ argument.

However, their more fundamental argument is that poverty is caused by factors such as worklessness, family breakdown, educational failure, addiction and serious personal debt and that these are more appropriate measures of children’s life chances.

This argument is driven more by ideology than by evidence.  The immediately obvious point is that being in work is no protection against a poverty-level income - indeed there are now more children living in poverty in working families than there are children in families where no-one works; and the evidence is that most low paid workers stay on low pay and do not progress onto higher incomes.

A more fundamental problem with the new child poverty targets is that they are predicated on an assumption that it is the source of parents’ income which is more important than how much income they have.  As Iain Duncan Smith argues:

Increase their benefit income – while taking no other proactive action – and you push the family further into dependency, only increasing the chance that their child will follow that same path as an adult. So while income is important we should be clear that the source of that income can have very different effects. Income through benefits maintains people on a low income, whereas income gained through work can transform lives.

So the government ignores the fact that increasing numbers of working parents are earning poverty-level wages and proposes that ‘worklessness’ is an appropriate measure of whether children are adequately housed, clothed, fed.  They also ignore evidence that changes to the social security system since 2010 create conditions which are harmful to children’s life chances.  As a result of lower incomes, many parents struggle to provide the basics of a roof over their head, warmth and food - 7.7 million children live in families adversely affected by the below inflation uprating of child tax credits and child benefits, and one in five of these families have cut back on food and/or cut back on heating because of this.  

In his emphasis on ‘individual responsibility’ and ‘worklessness’, Iain Duncan Smith also ignores the fact that a systematic review of evidence found that money does in itself make a difference to children’s outcomes.

So money does matter to children’s life chances and therefore should be included in any measurement of child poverty.  But so too do other factors - and this is why Iain Duncan Smith and the CSJ have a point.  

Children’s life chances can be improved or damaged, not only by the level of household income, but also by whether they have access to services such as health, education and housing, and to other types of support in their daily lives. 

What Iain Duncan Smith ignores is that, crucially, these are factors which can be improved or diminished by government policies.  This is despite his own admission that these types of services both improve outcomes for children, and should be part of the measurement of child poverty targets.  As he himself said, Health Visitors, for example: 

have been found to play an incredibly important role in helping families to cope and provide a stable environment for young children. Yet, once again, we don’t do enough to assess the impact of this investment on a family’s life in the long run. So I believe that we must look more closely at how we are measuring the impact of these interventions, and continue to push a debate about these wider measures of poverty.

When I was working with the Office for Disability Issues during the period of the last Labour government, we had a discussion with Treasury officials which started with a consideration of whether it would be useful to include access to public services such as a Sure Start Centre, in the measurement of child poverty and life chances.  This discussion didn’t go very far which is unfortunate because it might have opened up the possibility of recognising that universal access to good quality public services is a key part of tackling unequal access to life chances.

The irony - and tragedy - is that, although Iain Duncan Smith and the Centre for Social Justice have a point in their argument that poverty is not entirely about money, this government is creating a society where access to a good outcomes for children is becoming more and more about how much money their parents have.  

Who gets access to housing which enhances the quality of their family’s life?  People who are already economically advantaged (either by virtue of their own earning power or the wealth of their parents).  Who gets forced into housing which damages their and their children’s health and well-being? Families unable to afford decent housing because of the benefit cap and other reductions to their benefits, sanctions imposed by the Job Centre, unemployment caused by ill health and impairment or by wider economic forces beyond their control, the failure of successive governments to control rents and build social housing, and so on. 

Who gets access to good education? Children whose parents can afford to live in or move to an area with good state schools, where parents have enough social capital to start a ‘free school’, or where they can pay for private tuition or private school. Who gets access to good child care?  Parents who can afford to pay for it.

And why is this happening?  Because government policy generally supports markets as the main distribution mechanism for goods and services, whether this is through reducing ‘the size of the state’, encouraging the encroachment of the private sector into public services, or creating pseudo-markets in not-for-profit sectors.  Even when the government attempts to target resources to enable children from poorer families to get better access to public services, their overarching aim of reducing public expenditure can undermine the intended outcomes. This is what is happening with the Pupil Premium for example.  The National Audit Office reports that per pupil funding in the most disadvantaged secondary schools fell between 2010 and 2015, despite the pupil premium, because of other real-term reduction in other types of funding for schools.  

A refusal to recognise the harm to children caused by social and economic disadvantage means that the government and its actions/inactions are let off the hook.  Government policies can harm or enhance people’s lives. George Osborne can talk about a ‘high wage low welfare’ economy but in reality current policies are creating a ‘low wage low welfare’ economy with diminished public services and increasing inequality.   

The result is that children’s lives are being sacrificed to a political party’s aim to reduce public expenditure and collective responsibility, on the grounds that this will create the space for private enterprise and private profit, thereby supposedly fuelling economic growth. While there is no evidence that a ‘smaller state’ creates economic growth, there is plenty of evidence that both low household income and lack of access to good quality housing, healthcare, education and support services damage children’s lives. 

The new child poverty measures are therefore wrong on two counts - not only do they not include income but they also fail to measure access to the public services which, together with income, determine children’s life chances.

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