The Social Mobility and Child Poverty (SMCP) Commission finds that 3.5 million children will be in absolute poverty – almost 5 times the number needed to meet the government’s legal obligation to end child poverty by 2020 – and that the government lacks any credible plan to get back on track.
The Commission concludes that the government’s draft child poverty strategy 2014 to 2017 is a missed opportunity and falls far short of what is needed. The Commission recognises there are some good things in the strategy – such as the extension of childcare support for low-income families and greater acknowledgement of the problem of working poverty than there was in the last strategy – but believes they will not be enough to prevent child poverty rising over the next few years, let alone to deliver the large reductions in poverty needed to meet the 2020 targets.
The Commission backs its analysis with new research that it is publishing today. This challenges the government’s claim that slippage on reducing child poverty will be corrected by getting more people into work through Universal Credit and welfare reform. The new research, carried out for the Commission by Landman Economics and the National Institute for Economic and Social Research, finds that the 2020 child poverty targets will be missed by a large margin even if the UK achieves OECD-beating employment rates.
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The research estimates that even heroic assumptions about parental employment rates and earnings would still leave over 3 million children – 21% – in absolute poverty by 2020.
Indeed, the new research finds that achieving the 2020 targets within the current tax and benefit system would require parental employment rates of close to 100% combined with big increases in the working hours of families in working poverty over and above the requirements of Universal Credit.
Such employment outcomes for parents are implausible – they are far more ambitious than have ever been achieved in the United Kingdom or anywhere else in the world.
The Commission says in its report that the new research throws down a challenge to all the political parties to set out detailed plans for how their shared ambition of reducing – and ending – child poverty can be achieved.
Chris Goulden, Head of Poverty Research at the independent Joseph Rowntree Foundation (JRF), said: “The Social Mobility and Child Poverty Commission is right to sound the alarm bell on rising child poverty.
“In-work poverty is an inconvenient truth for politicians – affecting more than half of all households in poverty – and the safety net on offer to those who fall on hard times is increasingly threadbare.
“As the SMCP recognises in its report, forecasts for JRF show that one in four families will be living in absolute poverty by 2020, thanks to our insecure and low-paid jobs market and cuts to welfare.
“Poverty is risky, wasteful and costly at a time when our economy is looking to recover. Even at a time when resources are scarce, steps can be taken to reduce hardship faced by millions of families.
“This means getting to grips with low wages by paying the Living Wage and dealing with the rising cost of essentials, as well as offering affordable and quality childcare and improved work incentives under Universal Credit.
“We need a comprehensive strategy to address the underlying causes of poverty – but we also need to see political will to make it a reality.”
