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3 May 1999

Poverty: well done, but can do better

Education matters, but it's still the class system that makes children poor

By Yvette Cooper

Had Labour’s 1997 election manifesto set a target of cutting child poverty by 20 per cent in the first term, cynics would have said it couldn’t be done. Yet to surprisingly little fanfare, just two years after the election, the policies are now in place to do exactly that. Rising child benefit, the minimum wage, the working families tax credit and other reforms mean that more than 700,000 children are being lifted above the relative poverty threshold.

The government still has a long way to go, though. When Labour took office, around four million children were living below that poverty threshold (that is, they live in households who survive on half the average income). In a speech earlier this year, Tony Blair set a target of abolishing child poverty completely within 20 years. To achieve that target, Labour needs to build on the policies already in place – but also to confront some of the causes of poverty which are rooted in the British class system.

Anachronistic as the language may sound, the facts are compelling. Children whose parents are in the top 25 per cent of earners are four times more likely to become top earners themselves than the children of parents in the bottom 25 per cent. Tackling poverty and building a fairer society means dismantling the class system, too.

Since the election, much of the government’s focus on tackling the long-term causes of poverty and inequality has rightly been on education and employment. As a recent report published by the Treasury demonstrates, the great increase in the number of children growing up in poverty since 1979 is closely tied to the increase in the number of working-age households in which no one is employed.

At the same time, educational qualifications have become a far more important determinant of people’s chances in life: the earnings gap between those who leave school at 16 and those who stay on has risen from 40 per cent in the 1970s to 60 per cent in the 1990s.

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The growing importance of educational qualifications has encouraged some to suggest that class is now irrelevant. Family background, though, still has a big impact on children’s lives. This is no isolated phenomenon applying to an “excluded underclass”. The children of doctors do better than the children of clerical workers, who in turn do better than the sons and daughters of the unemployed.

According to the Treasury report, by the time children are 22 months old, the sons and daughters of professionals are 14 per cent further along the educational development scale than the toddling offspring of low-skilled workers.

Even where children’s early education achievements are identical, their chances of fulfilling their potential are not. Eleven year olds with identical test scores end up in better jobs if their parents are better educated. The 16 year olds with identical exam results are more likely to stay on at school if their parents did so before them. And teenagers with identical A-level qualifications still do better later on if their parents are middle class rather than working class.

The best way to keep children out of poverty in 20 years’ time is to boost their parents’ education today. Policies such as Sure Start, Education Action Zones and the New Deal are already focusing help on those who don’t get the opportunities they need. For that 20-year target to be met, the additional resources flowing to education in future must increasingly root out the disadvantages that children from low-skilled and low-income backgrounds still face.

But the impact of family background on poverty and children’s life chances goes beyond the education system. According to research by the academics Gordon Marshall and Adam Swift, middle-class children with very low qualifications still stand a 23 per cent chance of getting a middle-class job, compared to only 7 per cent for low-qualified working-class children. Could it be that the right kind of contacts and accent still get people into jobs regardless of their ability or qualifications?

Financial support matters, too. Even after taking account of the impact of parents’ education and employment, children from low-income families do less well: recent research from the Rowntree Foundation confirms that poverty lowers children’s aspirations about everything from birthday presents to future careers.

Raising the level of income in families with children is vital if we are to keep that 20-year target in our sights. The most powerful way to do that is to help parents into work.

Among the biggest gainers from Labour’s budgets so far is the one-earner couple with two children currently on around £11,000 a year. Once all the pipeline measures come into effect, that family will be better off by more than £2,000 a year. Where work isn’t an option, it is necessary to raise benefit levels for families with children, too. The government’s decision substantially to raise child benefit and the income support premium for under-11s was the right way forward.

The Labour government’s progress in confronting poverty is far greater than most people predicted. But the scale of the problem remains vast. Only an end to the relative poverty that families face today will give children fair opportunities for the future. And only if Britain tackles the persistent links between the social and economic status of one generation and the fortunes of their offspring will we build a just society. This has been the dream of the Labour movement for more than a century. It remains the defining challenge for the Labour government today.

The author is Labour MP for Pontefract and Castleford

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