We need an anti-poverty strategy based on evidence, not arguments over Tax Credits or Universal Credit, argues Chris Goulden.
Everyone agrees that money is a central feature of poverty and that there is more to it than just that. So why can't we reach consensus on how to reduce poverty in the UK? The debate gets boiled down to arguments over Tax Credits or Universal Credit rather than what would be needed for a full evidence-based strategy against poverty.
At the moment we have at least three different strands within government that are going in different directions – the child poverty strategy, pressure to cut welfare spending from the Treasury and a longer term social mobility agenda in Education and the Cabinet Office. That's on top of the social justice strategy in DWP, strongly associated with yesterday's Breakthrough Britain II report by the Centre for Social Justice.
The myths circulating about poverty seem to prevent progress being made.
- "Work is the best route out of poverty". On one level, this is almost a truism. But when someone from a family in poverty gets a new job, only 56% are taken out of poverty. We need to move beyond simple prescriptions based on misunderstandings of what the evidence is telling us.
- "Three generations who have never worked". In fact about 15,000 households in the UK have two generations who have never worked. Three generations logically must be a fraction of this. In contrast, there are consistently over 6 million people underemployed.
- "Tax Credits are just aimed at taking people £1 over an arbitrary line". IFS have shown that poverty would have fallen on a range of measures of relative income poverty from 45% below the median up to the middle.
I'm not saying that these objections are unimportant. We do need more jobs; and good quality employment is probably the best route out of poverty. Income is not the only measure of poverty and taking 60% of the median is arbitrary. It's time to move the debate on and accept that poverty in the UK is a complex and long-term problem. We need to use all the tools available to us in a way that breaks through policy silos.
The risk is that we will keep going with strategies that don't work and ad hoc adjustments to the welfare system. On the basis of current tax and benefit plans, including Universal Credit, alongside expected changes in jobs, earnings and demographics, we are looking at an absolute income poverty rate of 23% for children by 2020. None of us wants to see that happen. But that’s the risk, if we don't start having better strategies against poverty. These must be based on evidence and an appreciation of the costs of taking action, as well as the huge cost of poverty to society.