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| Cynical about the Tories redefining child poverty? You should be (updated) | Cynical about the Tories redefining child poverty? You should be (updated) |
| (1 day later) | |
| Update, 9.30am: Now we’ve got the numbers for 2013/14 , and – in general terms – they are not too bad for the government. Poverty is flat on most of the measures, and even falling on one. So the government will be satisfied that the big rise which some of the charities were predicting has not come about this year. As I wrote yesterday, below, the numbers get buffetted about by too many things to be confident about what will change between one year and the next. There are hundreds of pages of data to digest, but my best guess as to what is going on is that in this year, rising employment is making up for falling benefit income, a good story for the government. | Update, 9.30am: Now we’ve got the numbers for 2013/14 , and – in general terms – they are not too bad for the government. Poverty is flat on most of the measures, and even falling on one. So the government will be satisfied that the big rise which some of the charities were predicting has not come about this year. As I wrote yesterday, below, the numbers get buffetted about by too many things to be confident about what will change between one year and the next. There are hundreds of pages of data to digest, but my best guess as to what is going on is that in this year, rising employment is making up for falling benefit income, a good story for the government. |
| However, I would caution – as I also wrote yesterday – that there will be less good news further down the track. The new numbers are already out of date: they cover 2013/14, when average earnings were still falling back in real terms, and unemployment was falling faster than now. As a result, the relative poverty line did not rise as it would do in more prosperous times, and stagnant incomes at the bottom were sufficient to avoid any rise in poverty. | However, I would caution – as I also wrote yesterday – that there will be less good news further down the track. The new numbers are already out of date: they cover 2013/14, when average earnings were still falling back in real terms, and unemployment was falling faster than now. As a result, the relative poverty line did not rise as it would do in more prosperous times, and stagnant incomes at the bottom were sufficient to avoid any rise in poverty. |
| There are already signs of what could happen next, though. Firstly, overall income inequality has risen a little bit this year. Secondly, there is a sharp divergence in the fortunes of disabled people and others. For disabled people – one of the groups that depends most heavily on benefits – poverty (measured after housing costs) is up by a statitically significant 300,000. That is a harbinger of what will happen to other benefit-dependent groups as the cuts continue to come: groups that most importantly include families with children. | There are already signs of what could happen next, though. Firstly, overall income inequality has risen a little bit this year. Secondly, there is a sharp divergence in the fortunes of disabled people and others. For disabled people – one of the groups that depends most heavily on benefits – poverty (measured after housing costs) is up by a statitically significant 300,000. That is a harbinger of what will happen to other benefit-dependent groups as the cuts continue to come: groups that most importantly include families with children. |
| Here is the original piece from Wednesday … | Here is the original piece from Wednesday … |
| There is more to poverty than lack of money, of course. As the Conservatives manoeuvre to redefine what it means to be poor, they are surely right about that. The frugal life of, say, an ascetic monk may not be impoverished at all, if it is short in cash, but rich in purpose, community and understanding. By contrast, a life that enjoys material advantages unimaginable to generations gone by – smartphones, convenience food, cheap flights perhaps – might still be poor if it is lived without hope, company or direction. | There is more to poverty than lack of money, of course. As the Conservatives manoeuvre to redefine what it means to be poor, they are surely right about that. The frugal life of, say, an ascetic monk may not be impoverished at all, if it is short in cash, but rich in purpose, community and understanding. By contrast, a life that enjoys material advantages unimaginable to generations gone by – smartphones, convenience food, cheap flights perhaps – might still be poor if it is lived without hope, company or direction. |
| The main official measure of poverty – which defines being poor as living in a household with a disposable income of less than 60% of the contemporary median – is narrowly financial. It also has some implications which seem to fly in the face of common sense, as a Downing Street spokeswoman pointed out on Tuesday, when she said that a recession may actually appear to rescue poor people from penury, simply by dragging down the benchmark of typical pay. | The main official measure of poverty – which defines being poor as living in a household with a disposable income of less than 60% of the contemporary median – is narrowly financial. It also has some implications which seem to fly in the face of common sense, as a Downing Street spokeswoman pointed out on Tuesday, when she said that a recession may actually appear to rescue poor people from penury, simply by dragging down the benchmark of typical pay. |
| Ministers have every reason for wanting to move the goalposts, and opponents have every reason to suspect them of that | |
| But for all these undoubted problems, I’d defend the existing poverty target, which I had a hand in designing in Whitehall about a decade ago. It is a clear measure of a meaningful thing – the prosperity gap between the poor and the rest – which a government can actually hope to affect. If relative poverty falls during a slump, then that is an oddity, but it is not meaningless. Because if the lowliest living standards fall by less than those of others in hard times, then those with the broadest shoulders are indeed bearing the heaviest burden. And that is surely important. | |
| The Conservative plan to move to a new measure of the “root causes” of hardship, such as worklessness, debt and addiction, sounds reasonable, but the purpose is to cloud accountability – to create so many indicators that there is bound to be some nugget or other of good news to point to, even in a land where the poor are getting very much poorer. The objective is to whip up confusion in place of clarity, and provide cover for a shrinking state to retreat to in the war on poverty, to shift from energetic activism towards malign neglect. These are harsh words, but the cynicism is justified by both the backdrop to the poverty rethink, and by the Conservatives’ changing political game. | The Conservative plan to move to a new measure of the “root causes” of hardship, such as worklessness, debt and addiction, sounds reasonable, but the purpose is to cloud accountability – to create so many indicators that there is bound to be some nugget or other of good news to point to, even in a land where the poor are getting very much poorer. The objective is to whip up confusion in place of clarity, and provide cover for a shrinking state to retreat to in the war on poverty, to shift from energetic activism towards malign neglect. These are harsh words, but the cynicism is justified by both the backdrop to the poverty rethink, and by the Conservatives’ changing political game. |
| The immediate backdrop is provided by Thursday’s official poverty figures. Now, I’ve not seen the numbers at the time of writing, and nor – to be fair – am I assuming that the prime minister will have enjoyed a sneak peek before he trashed the existing statistics as creating an “absurd situation”. The number of poor people on this relative definition does indeed depend on a median income, which can be buffeted about by all kinds of things – wage settlements, changing patterns of employment and statistical noise – so it is unwise to make assumptions about the new data, covering 2013/14. But the best guess of the New Policy Institute, which worked various factors into its forecasts, is that the coalition’s benefit cuts are finally going to start translating into rising poverty rates. That would signal a turn in the tide on a decade of pre-recession progress on child poverty in particular. And even if NPI’s pessimism doesn’t turn out to be borne out in this year’s data, as the cuts, caps and freezes on the benefit incomes of the poor compound one another, it will certainly be borne out before long. | The immediate backdrop is provided by Thursday’s official poverty figures. Now, I’ve not seen the numbers at the time of writing, and nor – to be fair – am I assuming that the prime minister will have enjoyed a sneak peek before he trashed the existing statistics as creating an “absurd situation”. The number of poor people on this relative definition does indeed depend on a median income, which can be buffeted about by all kinds of things – wage settlements, changing patterns of employment and statistical noise – so it is unwise to make assumptions about the new data, covering 2013/14. But the best guess of the New Policy Institute, which worked various factors into its forecasts, is that the coalition’s benefit cuts are finally going to start translating into rising poverty rates. That would signal a turn in the tide on a decade of pre-recession progress on child poverty in particular. And even if NPI’s pessimism doesn’t turn out to be borne out in this year’s data, as the cuts, caps and freezes on the benefit incomes of the poor compound one another, it will certainly be borne out before long. |
| Related: Tory plan to redefine child poverty as figures set to show first rise in decade | Related: Tory plan to redefine child poverty as figures set to show first rise in decade |
| Ministers, then, have every reason for wanting to move the goalposts, and their opponents have every reason to suspect them of that. That was true before Cameron’s speech on Monday about ending “the merry-go-round” of low earners paying taxes and then claiming tax credits, but it is doubly true in its wake. The Tories have reaffirmed their pre-election promise to hack, hack and hack again at benefits, until £12bn can be saved. Neither the post-dated and modest rise that is mooted for the minimum wage nor prospective increase in the tax allowance will be anything like enough to compensate the millions of families set to lose many hundreds of pounds annually if their credits face the expected chop. | |
| The rethink on poverty is also part of a piece with a broader rethink of Conservative strategy. As a young opposition leader before 2010, Cameron wanted sunshine to win the day. He made a point of disavowing the Thatcherite Tory John Moore’s dismissal of relative poverty, pledged to measure it and tackle it, and even prodded his policy brain Oliver Letwin to sign up expressly to Labour’s precise poverty targets in the pages of the Guardian. It was all part of the great effort to sweeten the party’s “aroma”, as the Cameroons called their brand in those days, when their chief concern was winning the Tories a second look from the sort of people who might wear a Greenpeace T-shirt at the weekend. Those days are gone. Now the strategy, vindicated at the recent election, is “blue-collar Conservatism”, appealing to working-class Tories who are not much interested in such abstractions as relative poverty, but can certainly be rallied against those who are felt to be living at the expense of hard-pressed taxpayers. | |
| It is not just about branding, however; it is about hard currency too: in his first budget George Osborne actually increased the child tax credit by £150 a year, to protect the poor from wider retrenchments. Today, a government that has lurched to the right is about to embark on the exact reverse course, cutting tax credits so that more of the pain of austerity than ever before will be shouldered by the poor. No wonder they have decided it is a good moment for a rethink of how poverty is measured. |