Poverty: Definition (Hansard, 25 May 1989)

§ The Parliamentary Under-Secretary of State, Department of Social Security (Lord Skelmersdale)
My Lords, no government of any political persuasion have ever accepted that it is possible to have a simple definition of poverty. There is no doubt that there are and always have been disadvantaged people in society and that is why the Government are 502 monitoring developments to ensure that the vast expenditure on social security is targeted on those most in need. Planned expenditure in 1989–90 will be £51 billion, a rise of over 33 per cent. in real terms since we came into office.

§ Lord Carter
My Lords, I thank the Minister for that reply. Is he aware that speaking on television on 28th April last year his right honourable friend the Chancellor of the Exchequer said that to have half the average earnings in this country is to be poor? So that is what it means to be poor: to have half average earnings. It is hard to get hold of the exact figures because conveniently the Government stopped collecting them last year. However, does the noble Lord agree that this could apply to about 15 million people who would come into the category of earning half the average wage? Does he agree with the definition of poverty given by the Chancellor of the Exchequer?

§ Lord Skelmersdale
My Lords, I do not call that a definition. When one compares 1970 with 1985—my right honourable friend the Secretary of State for Social Security in a recent speech used a different time base—the figures show that the poorest one-fifth of families with children received in 1970, using 1985 prices, the sum of £129 a week. In 1985 they received almost exactly the same amount—£128 a week.

§ Lord Boyd-Carpenter
My Lords, is not the difficulty in answering the Question of the noble Lord, Lord Carter, the fact that poverty is not an absolute but a relative concept? Is it not true that what is grinding poverty in the United Kingdom would be regarded as affluence in Bangladesh?

§ Lord Skelmersdale
Yes, my Lords, my noble friend is absolutely right. Of course my right honourable friend was making the point in his recent speech that being less well off and being in poverty are two completely different things.

§ Earl Russell
My Lords, I accept what the Minister says about the difficulty of having any simple definition of poverty but will he tell the House whether he has any definition at all, and if so what it is?

§ Lord Skelmersdale
My Lords, as my noble friend has pointed out, poverty is relative and depends on where one happens to be, the social conditions, average income and so on.

§ Lord Rippon of Hexham
My Lords, following the question put by my noble friend Lord Boyd-Carpenter and leaving aside any international considerations, does my noble friend agree that so far as concerns this country it is not a statistical matter and it could be argued that here there is less poverty but more misery?

§ Lord Skelmersdale
My Lords, my noble friend takes me down a very semantically complex route. It is an even more "semantic" road than that which other noble Lords have tried to make me take during 503 my answers to this Question. One can be rich and miserable as well as poor and miserable. I do not think that my noble friend's question greatly helps the discussion.

§ Baroness Jeger
My Lords, in his speech of 11th May, of which I have a full copy thanks to the courtesy of the Minister, the Secretary of State expressed the view that even the poorest one-fifth of families with children spend nearly one-tenth of their income on alcohol and tobacco. Is that the Government's view? Can the noble Lord say what statistical definition lies behind the phrase "the poorest fifth"? Who are the people who comprise "the poorest fifth"? Did the Secretary of State collect budgets from everybody? How did he define "the poorest fifth"? In all courtesy I submit that it is very unfair to many low income families to bandy about such statistics. I know that many of them feel very hurt and deeply offended.

§ Lord Skelmersdale
My Lords, it might surprise the noble Baroness to know that my wife chooses not to have a television at home. That does not make her poor. However, my right honourable friend was seeking to say that, yes, of course, there are those who are less well off in society and they are recorded, as the noble Baroness knows well, in quintiles and deciles. We discover this from such investigations as the family expenditure survey about which I have spoken very recently. These are factual investigations. We are able to quantify therefore the habits and the expenditure and income profile of various sectors of society. I see nothing wrong in that.

§ Baroness Blatch
My Lords, does the noble Lord agree that to use benefit levels as the definition of poverty is misleading and intellectually disingenuous, and only serves to hamper the Government's attempt to target resources to those truly in need?

§ Lord Skelmersdale
My Lords, yes, I would certainly agree. If, as we are frequently asked, we increase the capital levels for housing benefit, income support, family credit and so on, that would immediately mean that more people came into the categories of potential beneficiaries for those benefits. If that happens, some people—certainly not I or my right honourable friend—would describe more people as being in poverty. That must be rubbish.

§ The Lord Bishop of Southwark
My Lords, does the Minister agree that while it is not possible to define poverty for some of the reasons that have already been given, it is in practice necessary for any government to define minimum living standards in order to have any sum fixed for social security payments of one kind or another? That being so, it would be helpful to know on what basis these are calculated and what proportion of them are intended to maintain basic food, clothing and heating and what proportion to cover the costs of more long-term needs to do with furnishings, cookers and so.

§ Lord Skelmersdale
My Lords, in a sense the right reverend Prelate is quite correct. An assessment has to be used every year in order to decide the level of the various benefits. However, the sixth report of the Social Security Advisory Committee in 1988 said that there is no universally accepted way of assessing the adequacy of benefits, particularly supplementary benefit, which is designed specifically to help those in greatest need.
The Government accept that the levels of income support are not over generous but consider that they provide for an adequate standard of living. There is no evidence that people generally are unable to manage. If they were unable to manage of course we would see real poverty in the land in the sense that I believe the noble Baroness, Lady Jeger, was trying to point out in her supplementary question.

§ Lord Carter
My Lords, while it is hard to define poverty, can the Government say why they discontinued last year the collection of statistics that related the number of families on low income to benefit scales?

§ Lord Skelmersdale
My Lords, I am not sure that I understood the question. Did the noble Lord ask why the Government persist in keeping records of——

§ Lord Carter
My Lords, why have the Government discontinued the collection of statistics which were collected for a number of years? Last year the Government decided to discontinue the collection of information that would have enabled them to identify the families on low incomes and relate those numbers to benefit scales.

§ Lord Skelmersdale
My Lords, statistics must be meaningful at the time that they are used. Some types of surveys and statistic gathering efforts are indeed meaningful at the time that they are carried out. However, a few years later, or earlier, they would not have been. That is why the Government have started a new statistical gathering base.

Lord Morris
My Lords, with regard to the first supplementary question of the noble Lord, Lord Carter, must there not necessarily be a considerable number of people below half the average income because, if there were any less, all that would happen is that the average would go up?

§ Lord Skelmersdale
My Lords, I am sure that my noble friend is right. That is why it is impossible to have a definition, for example, of poverty, of less well off people, or of disadvantaged people where the goalposts are constantly moving.

§ Baroness Seear
My Lords, I do not wish to prolong this conversation, especially as we shall be discussing social security during the next business. However, I should like to ask the Minister one question arising from what he said about changing the statistics. If one is studying these matters one wants to know the trend. If one has altered the method of taking the statistics, what was collected 10 years ago does not tell one much about today. But one wants to track 505 trends. Are the Government doing anything to ensure that we can seriously study trends?

§ Lord Skelmersdale
My Lords, perhaps it would be helpful to reply in terms of the unemployment statistics that the noble Baroness knows very well. Each time the statistical method is changed and there are different rules—for example, for claiming unemployment benefit—a calculation is made using the new method of statistics, back dated. One can therefore see a trend. Exactly the same thing is happening with social security statistics.

§ Lord Carter
My Lords, I apologise for having to rise again. Perhaps I may correct the point that was made by the noble Lord opposite. I referred, as did the Chancellor of the Exchequer, to half average earnings. Is the noble Lord aware that he confused the average with half the average?

§ Lord Skelmersdale
My Lords, it does not matter whether the reference is to half, whole, three-quarters or a quarter of the average. The goalposts would still be moving.

§ The Countess of Mar
My Lords, in the new methods of statistical collection, will the increase in debt among the poor be taken into account? I understand from citizens' advice bureaux that they are dealing with more and more debt problems of people who are afraid to go to the social security social fund for loans and grants because of the implication that that carries. They are incurring debts outside the social fund.

§ Lord Skelmersdale
My Lords, yes, indeed. The Government are well aware of this. I hope that the noble Countess will do everything to correct the impression that she has gathered from some of the people to whom she talks and who advise her. The advantage of a loan from the social fund is that it is interest free.