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25 February 2015

Labour’s unfinished business: the children still living in poverty

Eradicating child poverty is the Left's 21st century mission, argues Alison McGovern

By Alison McGovern

In my view, one of Labour’s finest hours in government came with the words: “Our historic aim will be for ours to be the first generation to end child poverty, and it will take a generation. It is a 20 year mission but I believe it can be done.” Tony Blair, in March 1999. Or, if you prefer, “Let us be remembered as the generation that won the war against child poverty that has shamed Britain.” Gordon Brown, sixth months later.

Either way, the two of them laid down a gauntlet to us.  Whatever their talents, it was unlikely they would still be in office when the promise matured.  So they bequeathed to the next generation of campaigners a clear determination that children should not be poor.

Sadly, the Tories and the Lib Dems have been unable to maintain progress towards the promise. They have faced significant economic headwinds, certainly.  But it is hard to deny that the current government have made matters worse. Because of stagnant wages, under-employment, rising prices and a failure to invest in childcare, housing and skills, child poverty is now up.

What does this mean? According to the Social Mobility and Child Poverty Commission, there are ‘600,000 more children in working households who are living in absolute poverty after housing costs than there were in 2009-10.’  There are serious consequences to this: insufficient resources at home leads to fewer qualifications at school.  Fewer qualifications means worse jobs or no job. And our low pay culture means their kids are poor too as the pattern repeats.  As Philip Larkin wrote, ‘it deepens like a coastal shelf’.

And then there is the opportunity cost to the economy of talent unused, and the extra costs incurred by business who have to go further to find skilled staff.

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But this description is not enough, because numbers cannot describe what it’s like to feel poor. A new report out next month from Liverpool City Council, called ‘Getting By’, has captured the experience of 30 working families in the city who are at the front end of the current government’s changes. To quote just one parent:

“It comes to the point where your seven year old son’s going ‘I know you haven’t got any money mum….. so it’s a bit upsetting cos you don’t want them to go without.  It’s heart breaking hearing your seven year old worrying if we can afford something.”

So the extra tragedy of child poverty is what it does to the mind.  Worrying about money when you are seven years old is not good for you. Expectations lower, low self-esteem increased. And, at the macro-level, left untreated poverty causes a society wide problem with poor mental health. This debilitates our chance of building a sustainable economy.

So much better then to recapture the passion and determination to keep our promise to our country’s children.  It’s time we asked what we can do to restart the drive to tackle poverty.

The next Labour government will have a clear focus on the factors that have led to the resurgence in child poverty. Income, barriers to work, and rising outgoings, all contribute to pushing more children into poverty.

So, radical reform of childcare takes on two of those factors: tackling the costs that are both hitting household budgets hard, and which make it uneconomical for many parents who wish to return to work to do so. Childcare costs have risen by 36 per cent over the past five years, leaving families with extra bills on average of over £1,500. This is a burden that is just untenable for many.

Labour in government recognised early the impact that childcare costs have on child poverty rates and introduced 15 hours of free childcare per week for 3 and 4 year olds. But with costs soaring well above wage increases, we will need to go further if more parents are not to be priced out of work: so for 3 and 4 year olds whose parents are in work, we will extend that entitlement to 25 hours, slashing – or in some cases removing completely – childcare bills for families. 

This policy alone will help 51,000 children in poverty, and many more at risk from growing up without enough to get by. And giving room to breathe for many who’ve had constrained times for too long.

You can’t underestimate the stress that money worries cause.  In fact, Relate say that it’s the most commonly cited reason for relationship breakdown. It’s not just getting by that we want for families, but also the space to progress, to go on holiday, to enjoy themselves.  These are the things that make life good, and it’s Labour that wants every family to be able to afford a good life.

Beyond childcare, we need to look at how we cut other bills that tip families and children into poverty.  The Social Market Foundation has new research out today that demonstrates – even more than before – that those with less resources are in some circumstances paying more. They say:

“Research demonstrates that low income households pay considerably more for the same goods and services compared to higher income households, because they get worse value in markets such as energy, insurance and banking.”

Labour has clear policies that will change the rules of the game to help those who have less. For example, energy bills that fail to reflect drops in global energy prices. Labour will reform the energy market, increase choice and competition, and require that falling wholesale costs are passed on to consumers.

Also, rapidly rising house prices in many areas of the country meaning that more children live in private rented accommodation. Labour will ban letting agents’ fees to tenants, which average over £350, and will introduce stable three-year tenancies as a default, with inflation-based caps on rent increases over that period.

And finally – a longer lasting answer to poverty requires more money coming in. Labour will increase the minimum wage to £8 by 2020, will incentivise companies to pay the living wage as well as promote apprenticeships, skills and training to raise incomes overall.

There are many policy areas where Labour’s reforms will help to stop child poverty. We cannot undo the past four years, but we can respond to the failure we have witnessed.

Child poverty is one of Labour’s great battles for the twenty-first century. Neglected and denied by the Tories, it will always be a priority for Labour campaigners and the next Labour government. I, for one, didn’t get involved in politics to sit idle while Tory policies made children poor. This fight is now too important to lose.

Alison McGovern is MP for Wirral South and shadow minister for children and families – she tweets as @Alison_McGovern. “Bargaining on a low income”, the Social Market Foundation’s report on low income consumers, can be read here

 

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