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Newsroom & speeches
20 July 2006
Check against delivery
Welcome to the Treasury and thank you all for coming. I am delighted to see so many of you here today, and for us to have this chance to talk about local and central Government working together to eradicate child poverty. My thanks to all members of the Child Poverty Accord, as well as Natalie Toms here in the Treasury for making today’s forum happen.
Eradication of child poverty is one of those rare political goals which can and does inspire and enthuse many, many people right across the country. That gives it added importance among progressive political goals. The Accord gives a corporate substance to that intention, and it has an important role – on the one hand in communicating to people like me what needs to be done and – on the other – in building support for this key goal. The Accord has worked hard to unite and strengthen the work of all the members. It is rare in bringing together central departments and local government, and I want to put on record my appreciation and thanks for all that has been achieved so far.
Our targets to tackle child poverty are tough and demanding. Halving the number of children in relative low income by 2010, eradicating child poverty altogether by 2020. Of all the goals we have set out, this is one of the most important.
And these are goals we need to work on together – not just in the Treasury, or the Department for Work & Pensions, but across agencies and local government too.
In the years since the Prime Minister first gave our pledge to eradicate child poverty within a generation, we have seen an impressive level of success. Figures released this year show that the number of children in relative poverty has fallen by 700,000 since 1997, from 3.1 million to 2.4 million on the before housing costs measure.
Yes, it was not quite enough to meet our first target of reducing child poverty by a quarter by 2005, although it was very close. And yes, our target to halve child poverty by 2010 is even more challenging.
But between 1979 and 1997, relative child poverty more than doubled – and was the highest in the EU. As the target is constantly going up with median incomes, if we had done nothing since 1997 – simply uprated the tax and benefit system in line with prices – there wouldn’t be 700,000 fewer children in poverty now, there would be 800,000 more. So we mustn’t under value the scale of what has been achieved so far.
Success so far has mainly been achieved through financial support and employment measures. I also recognise there is more that both Treasury and DWP can contribute. As Jim set out this morning, DWP are reviewing this summer how they can maximise the contribution their programmes and agencies make to this goal. And we certainly need to engage with wider public service policies too.
We have started that work. In 2004, we consulted with government departments, the voluntary sector and crucially, with local government too – to discuss how the elements of our public service delivery chain could better join together.
The result of this was published alongside the last Spending Review, in the Child Poverty Review, and it was at this stage that the Child Poverty Accord group was set up.
There is no dispute about the importance of local government in improving child outcomes. Many local authority officers around the country are doing great work, developing new and innovative practices that help us fight poverty.
So today, we have different levers to affect change, with local government directly at the heart of this, providing services that are key to breaking the cycle of deprivation – for example through schools and Children’s Centres.
One area that is crucial in the fight against child poverty is housing. Each child’s living environment has a significant impact on life chances. And I commend local authorities for their great work on neighbourhood renewal – ensuring that local areas are cleaner, safer and greener.
Housing has a key impact on material deprivation. Local Authorities play an important role both as providers of social housing and of temporary accommodation for homeless families.
The “decent homes” programme has ensured over 1 million more homes are in acceptable condition. And our programme of social housing building will contribute some 75,000 more homes between now and 2008.
I also want to underline the role of financial support for families, in particular the role of tax credits. Tax credits are now reaching more families than any previous system of income-related financial support – more than 6 million families and 10 million children are benefiting.
In particular, the Working Tax Credit ensures that work pays for parents – and the child element of the Child Tax Credit is paid in respect of each child in low income families, when parents are both in and out of work.
Because of this, a family on average male earnings is £1,500 better off in real terms now than in 1997, and a family in the poorest fifth is £3,400 better off.
While take up is high compared to past systems of financial support, we must do more to reach some of our most vulnerable families – which is where local authorities come in. There are innovative take-up campaigns in a number of local authority areas throughout the country – and I am impressed by the Quids for Kids campaign run by the LGA.
But it is crucial that authorities continue to help out where possible, targeting families who they know are eligible, providing advice where possible – sometimes through other means, such as Children’s Centres.
There have been difficulties with tax credit administration and overpayment. But this is a new and ambitious system – and we have watched and learnt since it started in 2003, and we have adopted a range of measures to give greater certainty to claimants while maintaining flexibility.
It is not fair to expect action on tax credits, or on any of the other issues discussed today, from local government without support, reward and recognition.
There are a number of ways we can do that, for example with Local Area Agreements, so I am delighted we have now entered a third round. Some local authorities in previous rounds put child poverty at the heart of their LAA and I commend that. I certainly hope that even more can be done in the third round – and I want to thank Accord members who will be available to provide help and support for those working on poverty issues.
Today’s event recognises the hard work and all-round effort from Accord members to make the Child Poverty agenda succeed, and I thank you again for contributing to success so far.
I share with the Child Poverty Accord the hope that this will be the start of a deeper, fuller dialogue between local and central government on this vital issue, and I will do everything I can to support you in that work over the years to come.
