Child Poverty (Hansard, 17 January 1991)

§ Mr. Jack

The response of my right hon. Friend the Secretary of State is as followsThank you for your letter of 7 December enclosing a copy of the report on "Child Poverty and Deprivation in the UK". The Prime Minister has also asked me to thank you for your letter to him dated 11 December. I would like to comment on some aspects of the report which fall within the remit of my Department. I read the report with considerable interest, and can assure you that the Government fully agrees with the conclusion that "a key determinant of children's lives is the state of the economy." That is why we have pursued policies aimed at creating a competitive and thriving economy—because we believe that is the best way of helping all the people of this country. I was also pleased to see that the author recognises the danger of attempting to define a "poverty line", with poor people on one side and people who are not poor on the other. As you know, we have often drawn attention to the fact that 590W no Government in this country—irrespective of political persuasion—has ever accepted that a single "poverty line" can be drawn. As the author of your report demonstrates, a line fixed at, or around, the benefit level has the paradoxical effect of increasing the number of "poor" people whenever the benefits are increased. I was therefore rather surprised to see him dismiss one "poverty line" on grounds of "intuition" in favour of another equally arbitrary one at 110 per cent. of the supplementary benefit level. I think the report is rather disingenuous in stating that "only" 45 per cent. of the increase in numbers with incomes below this level are accounted for by real increases in benefit levels. Looked at another way, the report is confirming precisely what we have always argued—that a very substantial proportion (nearly half) of the increase in numbers is attributable to real increases. I would not dispute that unemployment also played a part in increasing the numbers receiving benefit—but unemployment has virtually halved since the period in question; and the Government has responded to another factor which has also undoubtedly come into play—namely, the growth in lone parenthood, to which we have responded by developing a comprehensive strategy including proposals for enforcement and collection of child maintenance, benefit improvements for lone parents, and better work incentives. I was also disappointed to notice that the report, in commenting on the growth in numbers of children living in households with incomes below the average, or below half average, has ignored the very significant growth in average income itself. Any statement about the numbers living on incomes below a proportion of the average is simply incomplete without any reference to the overall growth in the average—which rose by some 23 per cent. between 1979 and 1987. Indeed, a careful examination of tables B3 of Households Below Average Income will demonstrate that between 1979 and 1987 the proportion of children below half average income (1979 level expressed in real terms) actually fell.