Anti-poverty strategies for the UK

October 2014

Chris Goulden, Head of Poverty Research, JRF

It’s time to rethink poverty

• Half of people in poverty live in working households– One in five workers is low paid

• Poverty prevents the economy from firing on all cylinders– Child poverty costs us £29bn each year

• Debate on poverty is divisive– But 62% think there is “quite a lot of poverty”

• Poverty exists but it’s not inevitable

What is poverty?• When you can’t afford to meet your basic needs

– Includes taking part in society (birthday presents, school trips…)

• Two basic solutions1. Increase people’s resources2. Decrease the cost of meeting needs

• Needs a comprehensive approach, addressing:Taxes and benefits Labour marketsCost of essential goods & servicesWhere we liveThe choices we make

Almost anyone can experience poverty

• Poverty is dynamic– Over half of the population experienced at least

one year in poverty during 1991-2003

• But some groups at much greater risk– Including those with complex needs

• Aspirations remain high despite poverty– 97% of mothers want child to go to University

Costly, wasteful & risky

• Poverty affects educational achievement and earnings in later life

• Child poverty costs the UK £29bn each year• Work needs to be a route out of poverty

– 56% of working households have someone paid less than the Living Wage

• Job insecurity is bad and worsening– Half of men newly claiming JSA have done so in

previous 6 months• And many cannot work from disability or caring

Previous strategies have had…

• No vision of a poverty-free UK– No long-term cross-party support

• No link between actions and outcomes• No dynamic or life course approach• No involvement of people in poverty• No consideration of policy interactions• Not really strategies at all

Programme structure 2013/14 2014/15 2015/16

TimetableTask Date

Commission models of poverty Done

Publish 33 evidence summaries Done

Publish ‘a UK without poverty’ Done

Publish reviews of theory Autumn 2014

Refine and test policies Now to mid-2015

Start to draft strategy for UK Early 2015

Publish UK strategy Dec 2015

Publish strategies for Scotland, Wales and Northern Ireland

During 2016

Implementation??? 2017+

What policies might work?• Universal Credit, better and more generous design• Incentivise welfare to work systems to reduce poverty• Fairer benefit uprating• Action on pay through NMW increases & Living Wage• Localise skills budgets, co-ordinated with employment programmes• Business-sector led skills development strategies• Increase affordable housing supply• Area-based energy efficiency schemes• Rebalance childcare support on those with lowest incomes• Reform markets for essential goods and services• Raise teaching quality in schools with most poor pupils• Co-location of advice and support, including for relationships• Long-term, intensive support for complex needs

Where are we heading?

• If we don’t act now, poverty will increase– Also would if 2010 system had been in place

• Prices of essentials have been rising fast while wages at the bottom and benefits stagnate

• Technological change & globalisation lead to a divided job market

• Demographic pressures: living longer but with poorer health, alone, diverse families

• Climate change affecting poorer communities

A comprehensive approach Nature of work at the bottom end of the labour market Cost of living, markets for goods and services and

regulators Whether people can reach their potential at school or at

work Civil society and private institutions that are important in

people’s lives The choices that people make• Poverty is real but not inevitable

– Look at pensioner poverty• A poverty-free UK would not only be good for people who

experience poverty; it would be good for everyone