Clause 24

Child Poverty Bill – in a Public Bill Committee at 4:30 pm on 3rd November 2009.

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Meaning of “child poverty” in Part 2

Photo of John Howell John Howell Conservative, Henley

I beg to move amendment 63, in clause 24, page 14, line 7, leave out from ‘of’ to ‘section’ in line 8.

I will not detain the Committee for long. The amendment is and always was intended to probe an issue that was covered in some detail this morning. I wish to illustrate the difficulties that were raised particularly by the local government representatives at their evidence session. There is a problem in being able to show the relevance of the target that the amendment would delete in the local government context. We considered that in some detail this morning in relation to Paul Carter’s evidence and the difficulty over the 48,000 children. We discussed it in terms of proxy targets, which covered quite a lot of the issue. It will still be useful to give the Minister the opportunity to justify a little more clearly than she did this morning the relevance of the target to local government officers, who succinctly expressed the difficulties of meeting it.

Photo of David Gauke David Gauke Shadow Minister (Treasury)

It is a pleasure to serve under your chairmanship again, Mr. Key. I am grateful to my hon. Friend the Member for Henley for bringing the Committee’s attention to this point. In part 2, the definition of child poverty is different from the one that applies in part 1, which includes the duties on the Government. The definition in part 2 is slightly narrower to exclude the persistent poverty target, but it includes the relative low income target, which uses the figure of 60 per cent. of median income.

As we heard from the experts in the evidence session on 20 October, that target is one in which the key method of achievement tends to be through the tax and benefits system. The evidence given by Richard Kemp from the Local Government Association is helpful. He argued that local authorities might have a role in safeguarding communities and preparing for new industries and new opportunities. However, he said that

“there are other areas—which might rightly be in the Bill—where you think that you have given us a duty to do something, but I will not be able to have any effect on it because those levers are outside my control. That is why we concentrate on the areas where we do have control.”——[Official Report, Child Poverty Public Bill Committee, 20 October 2009; c. 71-72, Q152.]

As we discussed in this morning’s debate about duties and what local authorities can do, the 60 per cent. target—I am not suggesting that it is not valuable or that it is not important for the Government—poses practical difficulties for local authorities. To put it another way, Councillor Kemp referred to the levers outside his control. Given that the Bill sets an absolute low income target and a combined low income and material deprivation target in clause 24—those targets apply to local authorities—what levers do local authorities have that apply to the relative low income target, but do not apply to the absolute low income target or the combined low income and material deprivation targets? What does the clause 2 target in clause 24 add to the Bill that cannot otherwise be achieved, given what local authorities can practically do? We all recognise that local authorities have a big role to play, but it is not clear how local authorities, as opposed to central Government, can deliver that target.

Photo of Helen Goodman Helen Goodman Parliamentary Under-Secretary (Department for Work and Pensions)

Let me first address the remarks made by the hon. Member for Henley, who suggested removing the reference to the relative low income target from clause 24(3). The clause sets out the definition of child poverty that covers the needs assessment and local strategy. Subsection (2) states:

“A child is to be taken to be living in poverty if the child experiences socio-economic disadvantage”.

Subsection (3) provides that households experiencing socio-economic disadvantage include those experiencing relative or absolute low income and material deprivation. However, the definition in the clause is not limited to those measurements, and local authorities may choose to use additional measurements to determine levels of socio-economic disadvantage in their area. It is not immediately clear what the hon. Gentleman intends by his amendment, as it would not lessen the breadth of socio-economic disadvantage. I understand that he is interested in the flexibility that the definition in clause 24 affords to local partners in assessing child poverty and taking action to address it, particularly in relation to raising family income.

Local authorities and their partners understand their communities and are in a position to reach them in a way that central Government cannot. They have a clear role in raising family income and tackling child poverty, by driving economic regeneration and neighbourhood renewal, providing high-quality education in early years services, administering financial help such as housing and council tax benefits for families on low incomes, encouraging families to take up financial support, and joining up national and local partners to provide personalised skills and employment support.

This morning we discussed the measurements to be used at local level, so I do not need to delay the Committee significantly on that. I made it clear that there were a range of measures, such as NI 116, the relative low income child poverty indicator, the national indicator set, and the index of multiple deprivation. Those measures cover child poverty and the range of risk factors associated with it. Persistent poverty is not a narrow definition, and I believe that we are consistent in the two parts of the Bill.

During the evidence session, the hon. Member for South-West Hertfordshire mentioned the relative income measure, and said that he thought that it was not relevant at a local level. I do not understand how something can be relevant at a national level if it is not relevant at the aggregation of a lot of local levels.

Photo of David Gauke David Gauke Shadow Minister (Treasury)

I am grateful to the Minister for giving way as she referred to a point that I raised during the evidence session. The evidence that we received suggested that local authorities could play a role, but that it would be difficult for them to focus on the 60 per cent. target—the relative low income target—as they do not have the levers to do that. They have the levers to focus on severe poverty and more general issues, which could be swept up in some of the other targets. I asked that question because that was where the evidence was taking us.

Photo of Helen Goodman Helen Goodman Parliamentary Under-Secretary (Department for Work and Pensions)

I think that that pulls me back to my first point, which is that national performance is an aggregation of the local performances.

Photo of David Gauke David Gauke Shadow Minister (Treasury)

I will try to make this clearer. The difference between national Government and local government is that local government has some levers, to use Councillor Kemp’s word, while the national Government have other levers. The evidence of Councillor Kemp suggested that the levers available to local government did not lend themselves to the 60 per cent. target, but rather to other targets.

Photo of Helen Goodman Helen Goodman Parliamentary Under-Secretary (Department for Work and Pensions)

I am afraid that the hon. Gentleman is not quite right. All the levers that are pulled—to use the Heath Robinson metaphor—will, we hope, have an impact on the income measures. Those could be actions taken at local authority level, such as job creation, or things done at national level, such as on child tax credit take-up. All those measures will have an impact. It could be that the levers in the hands of central Government are more finely attuned, but it is not true to say that things done by local government will not have just as much impact on income levels. If they did not, there would be no point to part 2 of the Bill.

Photo of David Gauke David Gauke Shadow Minister (Treasury)

Will the Minister explain, therefore, why clause 24 provides a separate definition of child poverty? Why not just refer to clauses 2 to 5?

Photo of Helen Goodman Helen Goodman Parliamentary Under-Secretary (Department for Work and Pensions)

I will come back to that, if the hon. Gentleman will let me.

The hon. Gentleman referred to subsection (2), which states:

“A child is taken to be living in poverty if the child experiences socially economic disadvantage”, and asked why we should include that in the Bill. By doing so, we can promote activity with local authorities that goes beyond the targets, which is something that he has promoted on many occasions—both for children in the looked-after sector, who are often perceived to be at the bottom of the pile, and for families who might not fall under a financial limit, but whose level of material well-being we are trying to improve.

Photo of David Gauke David Gauke Shadow Minister (Treasury) 4:45 pm, 3rd November 2009

I am grateful to the Minister for giving way—she is being generous. I agree that there is an opportunity in the Bill to go further with regard to local authorities, because they have the levers to address specific matters such as looked-after children. The problem is that the evidence we received from the local authorities was that they did not really have levers for the relative poverty target. In that case, if we are to tailor our targets for particular authorities and make them as relevant as possible, why do we not tailor clause 24 a little more and take out the relative low income target? We are trying to get an answer to that question.

Photo of Helen Goodman Helen Goodman Parliamentary Under-Secretary (Department for Work and Pensions)

Although it is enjoyable to debate with the hon. Gentleman, the proposal was only a probing amendment, and I am not entirely convinced that this debate is taking us anywhere. My argument is simple: we need to be consistent between what we do at local level and what we do at national level. I really do not think that I can helpfully add any more to what I have said.

Photo of John Howell John Howell Conservative, Henley

We have heard the most relevant question of the day: why have part 2 at all? From the answer that we have received, we know that there is no point to part 2 in its current form. There is clearly a lack of understanding of how things work out on the ground. The lack of levers and data on the ground will make things particularly difficult for local government. However, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 24 ordered to stand part of the Bill.