Child Poverty Bill

Public Bill Committee, 22 October 2009.

Martin Caton (Labour, Gower)

May I remind Members and witnesses that we are bound by the Standing Orders and the deadline agreed on Tuesday? That means that this morning’s sitting must end at 10.25 am. I hope that I do not have to interrupt Members or witnesses in the middle of a sentence, but if I need to I will have to do so. We will now hear evidence from Charlotte Pickles, Edna Speed and Reverend Paul Nicolson. Welcome to our meeting at this early hour of the morning. Could you please introduce yourselves and tell us something about your organisation? Can we start with Reverend Nicolson?

Martin Caton (Labour, Gower)

The first question is from Steve Webb.

Steve Webb (Liberal Democrat, Northavon)

So in terms of the Committee assessing the value of the proposals—we could all spend £2 billion or £3 billion making the benefits system better—can I just be clear that the assumption that you get that money back takes no account of the fact that the people you think would be able to get into work would displace another set of people to whom you then pay benefit? Have you allowed for that in your costings?

Steve Webb (Liberal Democrat, Northavon)

I have just one other question. One of your arguments for your scheme is that it is much simpler than what currently goes on, and you argue that you take the Inland Revenue out of the assessment process. You also propose delivering the benefits that you have invented through the pay packet, through a tax code-type thing. A big problem with tax and benefit reform is that you have benefits based on households and taxes based on individuals. If you have a couple where both partners are working and one gets the household’s tax credits, how would you keep tabs on both partners? If I were the higher earner, my spouse’s tax credits would have to be cut through their pay packet. How would the administration of that work?

Graham Stuart (Conservative, Beverley and Holderness)

Although you did not work on this particular paper, is the reason that you did not include the idea of a static supply of jobs, that we are part of the European Union? There were jobs that sucked in foreign workers, for instance, because of the benefit blocks that disincentivise people here who would like to work and to get out of poverty but find that doing so is not to the economic benefit of their family.

John Barrett (Liberal Democrat, Edinburgh West)

You mentioned, Reverend Nicolson, some very close, first-hand examples of people living in poverty. We talk about legislation here. Do you think that that will be effective as a way of tackling poverty? Are there not really issues like jobs, education and other issues? Could you give us your thoughts on how legislation might deliver? Out there, those who are actually in poverty, do you think that they believe that legislation is the answer, or is it something else? Could I ask you to speak from your own experience?

Karen Buck (Labour, Regent's Park and Kensington North)

Can I pick you up on something? I think everyone on the Committee agrees that there is deep, multiple deprivation that we have to tackle through different Government Departments. You just said that increasing wages, benefit or whatever would not lift people out of poverty. That is not right, is it?

Karen Buck (Labour, Regent's Park and Kensington North)

Okay, but I think it is important for the record that it is clear that the definition of poverty— families being on 60 per cent. or below of median income; we accept that it is only part of the whole story—is addressed by tackling income. It would be extremely unfortunate, and I hope you would agree, if we imply that dealing with the issue of income would not help us to tackle poverty, because I think it would.

Karen Buck (Labour, Regent's Park and Kensington North)

We could agree on the concept of it being necessary but insufficient.

Andrew Selous (Conservative, South West Bedfordshire)

Those statements slot quite neatly into the area that I wanted to probe as well, which is to get our witnesses’ views on the extent to which the Bill gets the balance right or wrong between alleviating symptoms and dealing with causes—exactly the area that you have been talking about. I wonder whether you share a concern that the Bill as currently written may not drive policy in a sensible direction. Edna, you said earlier that it is too late. It is not. We have next week to try to amend the Bill, then it goes through the Commons and the Lords, notwithstanding the electoral arithmetic. So, all these comments can be taken into account and Members can consider them when they vote.

My question is, what are your thoughts on how we should change the Bill so that we actually have to track progress on dealing with the causes of poverty, some of which you have already mentioned? I do not know whether you have any specific proposals. The Joseph Rowntree Foundation produces a report card with 56 different indicators of poverty, some of which the Government have made good progress on, others of which are steady, others of which have got worse. The Department used to produce such a report card up to 2007 and then slightly bizarrely stopped. Do you think a report card like that would be helpful in driving policy in a more sensible direction?

Andrew Selous (Conservative, South West Bedfordshire)

Can you give us some examples? Charlotte gave us some about addiction.

Martin Caton (Labour, Gower)

I am sorry to interrupt you, Edna, but we have a lot of territory to cover this morning, so I ask all our witnesses to try to be as succinct as possible.

Andrew Selous (Conservative, South West Bedfordshire)

Can I stop you there? What you said was very useful; thank you very much for that. In America, as far as I am aware, there are poverty standards based along the lines that you are talking about, on what a nutritious diet costs for a family and multiply that for different levels of family. I think they worked out that families spend a third of their income on food, so they multiplied it by three to get levels of income on which they judged people in poverty. Is that the type of idea that you are talking about?

Andrew Selous (Conservative, South West Bedfordshire)

Are you saying that once you have found that, the benefit system will immediately have to kick in and rise to those challenges?

Helen Goodman (Labour, Bishop Auckland)

What Reverend Paul Nicolson says about the importance of young women eating healthily is extremely important. That is one of the reasons why we introduced the Sure Start maternity grant and the health in pregnancy grant this year. I would like to ask Charlotte a question. You said that money spent on benefits for families where there is drug and alcohol addiction probably would not benefit children. Do you suggest that those families should have lower benefits, or that any increases in benefits for all families should not go to those families?

Helen Goodman (Labour, Bishop Auckland)

Of course it’s true that people who are addicted to drugs and alcohol need help to get off their addiction. Of course they need care from the health services. However, we are talking about a Bill about child poverty. There are services delivered by the local authorities and the NHS to deal with those problems, but I do not quite understand what relevance that has to your comments on the Child Poverty Bill.

Helen Goodman (Labour, Bishop Auckland)

I want to point out that you have said again, in that extremely long answer, that a child in an addicted family would not benefit from increases in benefits. I think that you should look at the record after this session to see precisely what you have said. That is exactly what you have said.

Martin Caton (Labour, Gower)

I would be grateful if we could turn the competition for length of contributions to brevity of contributions.

Graham Stuart (Conservative, Beverley and Holderness)

You have all welcomed the Bill, but do any of you fear that it could prove counter-productive, for instance due to a misallocation of resources? If in a constrained financial situation a Government felt the need to meet the income levels, they would fail to allocate resources when they might more properly have been spent on other support services.

Graham Stuart (Conservative, Beverley and Holderness)

That is not in this Bill and that is my point: could the Bill, as it stands, be counter-productive and in what ways? What do we need to change to ensure that it is not like that?

Graham Stuart (Conservative, Beverley and Holderness)

I wonder whether Reverend Paul Nicolson has any misgivings.

Judy Mallaber (Labour, Amber Valley)

We seem to be partly in an argument about whether it is a lack of income that leads to other problems. While accepting some of the very difficult families in multiple deprivation that we have been talking about, I see a large number of families in my constituency who have been helped solely because they have been given more income. Could you all comment on whether it is the case that for a substantial number of people, just having more income would resolve their other problems? Secondly, to what extent do you think it would be sensible to put more and more targets within one Bill, as is being suggested by adding yet more areas to different clauses?

Jamie Reed (Labour, Copeland)

Apologies to you, Mr. Caton, members of the Committee and witnesses for being late for the hearing. My comments should perhaps be understood in the context of that apology. Although I have been very encouraged by some of what I have heard this morning, I am disturbed by what seems to be the false notion that the one and only method by which this country is dealing with child poverty is the Bill. A lot of the conversation and comments are that, in the policy fields of housing, health, education, early intervention, free school meals, working family tax credit, child trust funds and efforts to address market failure in English regions are somehow irrelevant and divorced from the Bill. Would you like all those other different strands of policy that address child poverty and poverty in the round in this country to be included in the Bill?

Martin Caton (Labour, Gower)

Thank you. Do other witnesses want to comment?

Helen Goodman (Labour, Bishop Auckland)

On Tuesday afternoon, we took evidence from some other voluntary sector groups, including Gingerbread, which is the lone parents’ organisation. I am going to ask you the same question that I asked them: do you think that family breakdown is a significant cause of child poverty?

Helen Goodman (Labour, Bishop Auckland)

May I ask a follow-up question about that? Taking your perspective together with Reverend Paul Nicolson’s, if you think that that is a crucial moment when families fall into poverty, do you think that the state should provide extra support at the moment that families separate? Should there be a divorce grant?

Helen Goodman (Labour, Bishop Auckland)

I was not saying that that was my view; I was just trying to explore the logic of the witnesses’ position. Picking up on the issue of parents, do you not think that clause 8(5)(a) on the development of the skills of the parents surely covers skills that go beyond work skills? Does it not cover life skills? Is that not what it addresses?

Martin Caton (Labour, Gower)

Do you have a contribution to make, Reverend Paul Nicolson?

Andrew Selous (Conservative, South West Bedfordshire)

Just a quick follow on. The Minister directed us to clause 8(5) which mentions some vitally important areas: health, education, social services, housing, the built environment, the promotion of social inclusion and the promotion and facilitation of employment of parents in the development of skills. I recognise all of those. Would our witnesses think it would be helpful to have something explicit in the Bill that just talks about the importance of trying to strengthen family stability? I absolutely accept Mr. Nicholson’s statement that it is poverty and debt that often drives family breakdown, but it works the other way. As the impact statement says, family breakdown can also cause poverty.

Martin Caton (Labour, Gower)

That is excellent. One word is fine.

Andrew Selous (Conservative, South West Bedfordshire)

My parents are divorced too. I come from a far from perfect family. We are of a kind there.

Martin Caton (Labour, Gower)

Thank you. You have made that point very well.

Martin Caton (Labour, Gower)

Very quickly then.

David Gauke (Conservative, South West Hertfordshire)

Two of our witnesses have expressed concern about the emphasis on income in the Bill. Which of the four targets in the Bill—relative low income, material deprivation combined with low income, absolute low income and persistent poverty—do our witnesses think the focus should be on as part of the Government’s strategy to tackle child poverty? Which is the most important?

David Gauke (Conservative, South West Hertfordshire)

On your argument for minimum income standards, should that minimum income be determined on absolute or relative grounds?

David Gauke (Conservative, South West Hertfordshire)

Reverend Paul Nicolson said, with regard to the minimum income standards, that the matter should not be subject to judicial review. May I ask all three of you to say briefly how you see the role of judicial review, as far as the Bill and the targets enshrined in it are concerned? How important is it that Government could be taken to judicial review, and is that a helpful element of the Bill?

David Gauke (Conservative, South West Hertfordshire)

This is my final question: why do you think the Government are not going to meet their 2010 target?

Steve Webb (Liberal Democrat, Northavon)

This has been a very worthwhile discussion about whether targets on income alone do the job. Obviously, the Bill is more sophisticated than that; we have got measures relating to material deprivation and persistence, which are very welcome. I think that you are suggesting that we have targets on underlying causes, and I am trying to think what they might look like. Charlotte, you mentioned that there ought to be other targets of that sort. Could you give us some examples? For instance, if you think family breakdown—not just divorce but other sorts of breakdown—is one of the causes of child poverty, should we make cutting the divorce rate a target in the Bill? What would you suggest?

Steve Webb (Liberal Democrat, Northavon)

How do you measure strong families, though? We have to legislate for these things. Do you have a specific suggestion?

Helen Goodman (Labour, Bishop Auckland)

On Tuesday, when evidence was taken, there was some criticism of clause 15 on economic and fiscal circumstances. This is a question specifically to Charlotte Pickles: do you think, as some groups do, that clause 15 should be taken out of the Bill?

Helen Goodman (Labour, Bishop Auckland)

How do you reconcile what you have just said with your report, “Dynamic Britain: towards welfare that works”, in which you set out a programme that you have costed at £2.7 billion?

Helen Goodman (Labour, Bishop Auckland)

In the short term?

Helen Goodman (Labour, Bishop Auckland)

Are you saying that this £2.7 billion is instead of the numbers in the forward forecast projections, which means an overall cut, or are you proposing that the £2.7 billion be on top of what is in the existing projections?

Helen Goodman (Labour, Bishop Auckland)

So—

Martin Caton (Labour, Gower)

I’m going to have to cut that off. I call John Howell.

John Howell (Conservative, Henley)

One of the things about this morning’s discussion that has been useful is that it has looked at matters at a macro-economic level, but the Bill hands the delivery of what it wants to achieve over to local government. Given that the Reverend Paul Nicolson said that the Bill is about income, is that an appropriate thing to do to achieve what the Bill sets out to do?

John Howell (Conservative, Henley)

That is fine, but my question is a practical one. The Bill will transfer much of the delivery to local government. Is that going to achieve what you think the Bill should achieve?

John Howell (Conservative, Henley)

What would you like to see in the Bill that will make it deliverable on the ground?

John Howell (Conservative, Henley)

Standards are fine, but we are talking about the delivery of the Bill on the ground.

John Howell (Conservative, Henley)

Is there anything out there on the ground at the moment that gives you confidence that it is best practice for delivering what the Bill wants to achieve on the ground?

Martin Caton (Labour, Gower)

Order. I am afraid that that brings us to the end of the time allotted for the Committee to ask questions to witnesses. I thank them on behalf of the Committee. The Committee will meet again at 1 pm.

Martin Caton (Labour, Gower)

May I remind Members and witnesses that we are bound by the deadline agreed to on Tuesday? That means that this afternoon’s evidence session must end at 2.30 pm. I hope that I do not have to interrupt Members or witnesses in the middle of their sentences, but if that time arrives, I am afraid that I will have to do so.

We will now hear evidence from Dr. Tess Ridge, Donald Hirsch, Mike Brewer and Neil O’Brien. Welcome to our meeting. Would each of you like very briefly to introduce yourselves and your organisation, starting with Dr. Ridge?

Martin Caton (Labour, Gower)

Can we stick to the same batting order for answering questions?

John Barrett (Liberal Democrat, Edinburgh West)

Do you think that it is effectively hot air? It sounds like something is being done, but not a lot is being done. Is that what you are saying?

Steve Webb (Liberal Democrat, Northavon)

Obviously, we are in a recession, but most of the statistics that we have got so far are pre-recession. I wonder if I could ask—initially to get the IFS perspective, although others might want to comment—how you think that the recession will impact on the level of child poverty on these measures.

Steve Webb (Liberal Democrat, Northavon)

Looking ahead to 2020, if we are going to “eradicate” or get down to 10 per cent, and if we have tax credits and benefit levels below 60 per cent. of median income, can you see any way in which we can achieve the goal? Presumably, there will always be 10 per cent. of children at any one point in time on benefits. Is it credible to think that any party will ever achieve those goals?

Steve Webb (Liberal Democrat, Northavon)

Our understanding is that the figure of 10 per cent. was chosen ostensibly because 10 per cent. is about as good as you get in the EU at the moment, but obviously 10 years ago 5 per cent. was about as good as you got in the EU. Should the goal of a 10 or 12-year strategy be as good as we have at the moment or as good as it credibly could be? Is 10 per cent. too unambitious or would 10 per cent. be extraordinary given where we are starting?

Helen Goodman (Labour, Bishop Auckland)

What do you think will be the impact of having the four measures? You have all talked as though there were just the one relative low-income target, but there is also the material deprivation, the persistent and the absolute poverty level. Do you not think that that makes the impetus of the policy much tighter?

Andrew Selous (Conservative, South West Bedfordshire)

I would like to ask about severe poverty, which is generally regarded as being below 40 per cent. of median income. The figures that I have seem to suggest that that has increased slightly over the past decade. Picking up on our earlier point, on the basis that you should do the most for those who need the most and are in the greatest difficulties, do you think that there would be any merit in tracking those in the most severe poverty, particularly severe, persistent poverty?

Andrew Selous (Conservative, South West Bedfordshire)

So you think 60 per cent. is where it should be and you are comfortable?

Andrew Selous (Conservative, South West Bedfordshire)

Why are the data more robust at 60 per cent. than at 40 per cent?

David Gauke (Conservative, South West Hertfordshire)

May I follow up on the point about robustness? I was struck, Mr. Brewer, when you said that the 40 per cent. measure is particularly unrobust. How robust are data relating to income and material deprivation at 60 per cent. of income? You have just touched on that, Mr. O’Brien. How reliable are the surveys and such like on which the assessments are made?

David Gauke (Conservative, South West Hertfordshire)

But is there still a problem at 60 per cent.?

David Gauke (Conservative, South West Hertfordshire)

The draft orders have been circulated among members of the Committee, and one of the things that I found it somewhat difficult to get my head around was the equivalisation of net household incomes, which involves a complicated formula. How objective and scientific are the equivalence scales? Or is that a matter on which a degree of judgment is used in determining what they should be? There is clearly an issue about families of different sizes and the income that you need. How does that work?

David Gauke (Conservative, South West Hertfordshire)

Would other witnesses agree that there is an arbitrary element here?

David Gauke (Conservative, South West Hertfordshire)

We always look at this from a national perspective, but there are disparities between income and costs on a regional basis. London, for example, has a very high level of child poverty, and costs are higher and the median income is higher. What would happen if we started looking at the issue on a regional basis? I imagine that we would find that there is more child poverty in London, but on a national basis, would we have more or less child poverty?

David Gauke (Conservative, South West Hertfordshire)

We have talked about the target in the 2010 figure. On current policies, what level of child poverty are we heading for in 2020?

David Gauke (Conservative, South West Hertfordshire)

You have said that the 2010 target is not going to be met. For how long has that been apparent?

David Gauke (Conservative, South West Hertfordshire)

Coming back to your point about the 2010 targets, Mr. Brewer, I am sure that you must be right. The pre-Budget report is to be produced in the next few weeks. Presumably, if there were a legal obligation to meet the 2010 target, the Government would have to increase child tax credits by £4 billion. Is that how you read the operation of the Bill?

David Gauke (Conservative, South West Hertfordshire)

Presumably it would have been possible, some years ago, to identify the need to increase tax credits under this type of rubric, had it applied.

David Gauke (Conservative, South West Hertfordshire)

If I might, I shall ask one more question that flows immediately from that. Is your argument that in the early years of the operation of the Bill, a Government should take long-term measures to reduce child poverty—measures that might not necessarily have an immediate, visible impact on the annual targets and the number of people who are taken out of poverty? You could have an immediate impact by raising benefits, but to achieve the aims of the Bill you need to address the longer-term causes of poverty in the early years.

John Howell (Conservative, Henley)

You described the Bill as being about income and income targets, but the delivery of much of what the Bill wants to achieve is pushed over to local government. Do you see a mismatch between those targets and how the Bill expects them to be delivered?

John Howell (Conservative, Henley)

Earlier, one of you said that something pretty big needs to happen. Is that something big going to happen as a result of the delivery mechanisms set out in the Bill?

John Howell (Conservative, Henley)

My next question comes out of Dr. Ridge’s point. There has been some comment that the Bill does not actually force councils down the line, but maintains an approach that pushes them more towards area-based programmes rather than towards family-by-family programmes. Given the success of family-by-family programmes, do you think there is sufficient flexibility in the Bill to allow it to achieve anything good on the ground?

John Howell (Conservative, Henley)

There is always a huge gap between intentions and achievement, though.

Karen Buck (Labour, Regent's Park and Kensington North)

You talked a minute ago about the estimated £4 billion cost of meeting the 2010 target. I don’t know if you heard it mentioned in this morning’s evidence session, but you will have looked at the report by the Centre for Social Justice estimating that it would be possible, for around £2.5 billion, to change fundamentally the work disincentives. Don, you in particular have done some work on the estimated cost of poverty—around £25 billion a year. Can the four of you help us to understand the relationship between the estimated cost of poverty and the cost of investing in meeting short-term targets, whether they be work incentives or the £4 billion in tax incentives? How quickly would it be possible to start offsetting expenditure on poverty against the money you invest to tackle it?

Karen Buck (Labour, Regent's Park and Kensington North)

What about specifically targeting money on removing work disincentives?

Karen Buck (Labour, Regent's Park and Kensington North)

This is the same question as the one Steve Webb asked this morning. Is there any risk that investing in tackling work disincentives as a means to encourage people into employment simply displaces costs from one group of people to another? Unless the labour market grows, you are not necessarily going to make any savings in terms of gross expenditure.

Steve Webb (Liberal Democrat, Northavon)

May I clarify the question? You are actually right, Karen. My worry about what the Centre for Social Justice seems to be saying is that there is a kind of free lunch here. It is suggested that some £2.5 billion could be spent up-front doing nice things to the benefits systems, and 600,000 people will take jobs. You can then take all the tax revenues, the benefits savings, the growth in the economy and the VAT they create, and that pays for it. I felt—this might be pejorative—that there was a slight free lunch feel about that. Surely, to some extent, you are just displacing other unemployed people. You are down as an advisor to the centre’s report. Has it taken any account at all of the fact that there is a whole set of people who could have had those jobs but did not? You said that the whole thing will just expand.

Karen Buck (Labour, Regent's Park and Kensington North)

To what extent is it helpful to consider the characteristics of groups most liable to fall into poverty when developing a policy response for them? Does that help you to target and focus your resources, or does it run the risk of pathologising the poor and missing as many people as you want to reach?

Karen Buck (Labour, Regent's Park and Kensington North)

I mean lone parents, black and minority ethnic groups and large families, for example—the major groups, really.

Karen Buck (Labour, Regent's Park and Kensington North)

Quite a few of the discussions in the last few hours in the Committee have been about people at risk of being in poverty, aspects of family breakdown and all the things that are potentially—depending on which perspective you are coming from—drivers of poverty. Policy has frequently chosen to target resources and policy prescriptions on particular characteristics, family structures and risks of falling into poverty. There might well be an argument for that, but it would be interesting to know your perspective on whether, when one is trying to reduce that number of 2.9 million children currently living in poverty, the right way to do it is to say that we need to worry in particular about lone parents, couples or large families, or whether it is actually simply better to stick with the income indicator targets that are on the face of the Bill?

Graham Stuart (Conservative, Beverley and Holderness)

Is there is a consensus on the balance of the long-term measures that are required, because that would appear to be the unstated assumption in the Bill? I particularly ask that because the Government have done a lot with what they regarded as long-term measures to try and tackle deprivation—Sure Start, various credits, new deal programmes, doubled school spending, skewing funding to areas of deprivation—yet children on free school meals have moved further behind. The number of children leaving primary school unable to read and write has not really moved, and the number not in education, employment or training—even before the credit crunch—increased, reaching a million. In the Bill, there is an assumption that if only we got some money and got going, we could sort that out. The Government did have money, and they did get going, but that did not sort it out.

Graham Stuart (Conservative, Beverley and Holderness)

Do we have a consensus, because we heard evidence this morning from a witness who said that the Sure Start programme simply had not touched the families in greatest need—the sort of families that that witness deals with on a daily basis? Is there consensus about what needs to be done for the long term? There is political pressure not to do the long term; as I say, this Government, to their credit, tried to do things for the long term. Is there a real understanding among the academic community that there are measures that will really make a difference?

Andrew Selous (Conservative, South West Bedfordshire)

I have.

Graham Stuart (Conservative, Beverley and Holderness)

May I ask you about minimum income standards? Again, we had evidence this morning about that. If the Bill is not going to prescribe minimum income standards delivery because of the costs mentioned, surely we should at least ensure the publication of minimum income standards—numbers—and monitor that over time?

Graham Stuart (Conservative, Beverley and Holderness)

So would you like to see an amendment to the Bill to ensure that, as you say, something that puts down the price of a can of baked beans is part of a family’s budgeting and what the budget needs to be to live any reasonable quality of life?

Judy Mallaber (Labour, Amber Valley)

I must say that I contest the tone of some of the questions that have been asked—for example, in relation to there being no improvement in the standards of reading and writing for primary school children when they leave school, and in relation to child care, which has improved enormously in my county of Derbyshire.

If I could just come back to the text of the Bill, Neil O’Brien made the comment some while ago that there was a mismatch between the strategy and the targets in the Bill. I do not really understand that comment because targets have been set out as the first duty of the Secretary of State. The second duty of the Secretary of State is about drawing up a strategy that concerns two things: first, looking at meeting the targets and, secondly, ensuring that children do not experience socio-economic disadvantage. A number of headings set out what would be part of the components of that strategy, which in my view would also encompass child care. As that is my interpretation of the Bill it, in terms of how effective the way in which we should draw up strategies is, I wonder if you could comment on how effective you believe those strategies might be. Do you have any other comments on how you think they should be developed, as set out in clause 8?

Judy Mallaber (Labour, Amber Valley)

Yes. Does that mean that your inclination will be to have no targets or to have far more targets? How do you take account of the fact that there are targets in other parts of Government policy that would feed into this strategy? We are bedevilled. We are told that we have too many targets and that we should not have any, then everybody comes along and says that we want a target for this, that and the other. You cannot win.

Judy Mallaber (Labour, Amber Valley)

So which targets would you put in?

Judy Mallaber (Labour, Amber Valley)

Would anyone else like to comment?

Sally Keeble (Labour, Northampton North)

My first question is for the IFS. At the time of the fiscal stimulus, which was £2.6 billion, the cost of eradicating child poverty was virtually exactly the same amount. A read-across would be too simplistic, would it not? How much of child poverty should be through redistribution and how much do you think it should be through the other targets in the Bill?

Sally Keeble (Labour, Northampton North)

I know that it does, but an argument is that, if we had done the £2.6 billion through child tax credits, we would have made a real dent in child poverty.

Sally Keeble (Labour, Northampton North)

Has the IFS costed out the other elements in the Bill?

Sally Keeble (Labour, Northampton North)

I want to ask more about child care. Bearing in mind where we were some years ago, the changes are very dramatic. Which bit of child care do you think has not been dealt with? If you take into account the child care element of the tax credit system, the early years curriculum, the children’s centres and the specifications for the children’s centres and for early years—things like outdoor covered play areas, which seem to be entirely child-focused—what practical steps do you think should be taken, and what is being costed, that would further improve child care?

Sally Keeble (Labour, Northampton North)

What are they resistant to, and to which age group of children are you referring? I am thinking of two-year-olds screaming as they are led into a children’s centre.

Sally Keeble (Labour, Northampton North)

Which age?

Sally Keeble (Labour, Northampton North)

How about the extended days? I completely agree that there is always room for further improvement in child care, but extended day provision in quite a number of schools has been extremely good, and has looked at precisely the group of children you are talking about. It has provided services precisely for them. The schools in the disadvantaged areas have probably been the best, so will you be more specific about exactly what is needed? If we are going to recommend it to the Government, we must be clear about exactly what is needed.

Sally Keeble (Labour, Northampton North)

So would it be more helpful if we thought of child care more as youth services? If you tell a nine or 10-year-old that they are going into child care, they will say, “Not me.” Northamptonshire county council, which is Conservative-controlled, is scrapping all its child care and youth services. Should we not be looking at the role that those services have to play in the total suite of services for disadvantaged children?

Sally Keeble (Labour, Northampton North)

Would it be more sensible, bearing in mind that we are talking about a Bill, to look at wording that relates to child care and youth services, rather than just child care, so that we capture the age ranges?

Sally Keeble (Labour, Northampton North)

It would be very helpful to have a note about the specific measures.

Andrew Selous (Conservative, South West Bedfordshire)

I would like to ask a question on work incentives or disincentives, and then follow up on something that Donald Hirsch said earlier about in-work poverty. Have any of you done any research on the effect of increasing levels of tax credits on labour market incentives and disincentives? That is an area that the Treasury traditionally takes very seriously. For example, when earnings disregards were being looked at in the child maintenance system, the Treasury pored over them very carefully to try to see what the impact would be on the labour market. Are there any potential worries that, by trying to meet the targets and by the possible ramping up of tax credits at some point in the future, you might skew the labour market somewhat and leave people on benefits? Such benefits might put them just above the poverty level, but would not give them a very good quality of life.

Andrew Selous (Conservative, South West Bedfordshire)

Okay. Following that up, you made a comment earlier, Donald Hirsch, where you quite properly referred to the large levels of in-work poverty. We all talk about work being the route out of poverty, but there are huge numbers of children whose parents are in work and yet still in poverty. That seems a rather neglected area sometimes, in terms of what we do with those parents to try to enable them to earn a higher income. Karen Buck will remember that a previous Chair of a Select Committee that we served on in the last Parliament used to talk about A, B, C—a job, a better job, a career. Do you see that as an important area? Do you see anything positive being done that you would alight on, and that would cause you to say, “The Government should look further in this area”?

Andrew Selous (Conservative, South West Bedfordshire)

Right. I am sorry, but you are still not quite getting my point, which is that if someone gets an entry-level job, they may be in work, but the reason why there are a lot of children in poverty is that those people never get above an entry-level job. They are still doing something with pretty basic skills all the way through their working lives, and that does not enable their children to get out of poverty. How do you upskill people who are in low-paid work, to enable them to progress in work and earn higher pay? That is what I am trying to get at.

Andrew Selous (Conservative, South West Bedfordshire)

You are not aware of anything around the world that has been successful, such as night-school programmes, mentoring or anything like that?

Martin Caton (Labour, Gower)

We will have one more question. Helen Goodman, this will most likely be the last question this afternoon.

Helen Goodman (Labour, Bishop Auckland)

I want to direct a question to Donald and Mike. What do you believe the impact of the minimum wage is on child poverty? If we did not have the minimum wage, what would be the impact on child poverty? Have either of you done any simulations on the subject?

Helen Goodman (Labour, Bishop Auckland)

Are you suggesting that there is a case for having a higher minimum wage or a lower minimum wage?

Martin Caton (Labour, Gower)

Dr. Ridge, I stopped you answering the previous question. You have a couple of minutes; would you like to answer it?

Martin Caton (Labour, Gower)

I am afraid that that effectively brings us to the end of the time allotted for the Committee to ask questions.