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The Guardian - UK
The Guardian - UK
Business
Heather Stewart

Labour must seize the moment to show child poverty matters in push for growth

A child's toy lies on the ground outside some boarded up abandoned houses on a housing estate Greater Manchester, UK
The child poverty strategy was promised in the spring, but some in Whitehall suspect it is now more likely to sit alongside the spending review, which concludes in June. Photograph: Russell Hart/Alamy

“Many of us had moments when we felt overwhelmed in sharing our stories. However, we pushed through, with the hope of changing policies that will improve the living standards of the many families living on low incomes who struggle in silence.”

Tayyaba Siddiqui was one of a group of parents and carers who sat around a table in Downing Street last month with the education secretary, Bridget Phillipson, and the employment minister Alison McGovern to discuss the challenges of raising children in poverty – and what needs to change.

The event was part of a comprehensive listening exercise, which has brought ministers and civil servants face to face with families and experts up and down the UK, to better understand the lives of the 4.3 million children living below the poverty line.

“We left the room with a promise of improvement and a government willing to work on the issues we raised,” Siddiqui wrote in a blogpost for the Child Poverty Action Group charity, which facilitated the meeting.

Yet while they do not doubt the sincerity of the ministers directly involved, there is growing wariness among campaigners about whether the long-awaited child poverty strategy will come with the necessary resources to make a real difference.

“We are now very anxious that this hasn’t been given the attention it deserves from the very top, politically,” said one campaigner.

Some inside government share similar concerns: that while Labour’s manifesto committed to tackling child poverty, aspects of the challenge sit uneasily with the party’s current preoccupations.

First, lifting children out of poverty does not fit neatly into the “growth” frame, through which the government now wants all policies to be viewed.

Second, it will cost a significant sum of money, at a time when Rachel Reeves is keen to wear the mantle of “iron chancellor”.

Third – and perhaps most worryingly – it clashes with the desire by some in Labour to present the party as tough on welfare, a stance likely to be on clear display in a forthcoming green paper on long-term sickness benefits.

One government source said they had been told by senior figures, citing focus groups and research, that Labour has a “brand identity problem” when it comes to welfare.

Campaigners, meanwhile, have noted the silence on poverty from Reeves. After watching the chancellor’s pro-Heathrow, anti-nimby speech, Rachelle Earwaker, the senior economist at the Joseph Rowntree Foundation (JRF), said: “We cannot only focus on the potential long-term economic benefits of roads, bridges and runways. We must also focus on ensuring that families have enough money and opportunity to afford the essentials and contribute to the economy.”

When it comes to solutions, there is a broad consensus among advocates and policy experts that the best-targeted measure would be to scrap the two-child limit, which caps some benefits for the third and subsequent children in a family, and had been applied to 450,000 of the UK’s poorest households by April last year.

The Institute for Fiscal Studies (IFS) has called this “a quick and cost-effective fix for bringing large numbers of children above the poverty line”.

Lifting the benefits cap, which limits how much in total a family can receive in welfare payments, is another powerful lever: the IFS estimates these two policies together would cost about £3.3bn a year.

Given the importance of housing costs in determining families’ standard of living, uncapping local housing allowance is another widely advocated, though costly, measure.

Of course, there is a range of important policies that do not involve pouring more resources into social security, and would improve poor children’s lives. These include supporting parents into jobs, building many more social homes, and ensuring energy companies provide a genuine social tariff for the poorest households.

Raising the minimum wage, and using the employment bill to lift terms and conditions – including, for example, by giving workers the right to regular shifts – is also part of the picture.

Labour insiders say the work and pensions secretary, Liz Kendall, and the deputy prime minister, Angela Rayner, have formed a powerful alliance to push for changes such as these, that won’t cost the taxpayer billions.

But campaigners are united in saying that a child poverty “strategy” that is silent on the needlessly cruel two-child limit would make a mockery of the consultation they have participated in in good faith.

It would also raise the question – again – of what this Labour government is for. Reeves has repeatedly said economic growth is not just about “lines on a graph”. But missing from the government’s hi-tech utopia is a vision of what kind of country we want to live in.

Surely for many Labour voters – and, indeed, backbenchers – that means working towards a Britain in which kids are not skipping meals or shivering in homes that their parents cannot afford to heat. As Save the Children points out, on average nine children in every class of 30 are now living in poverty.

Scottish Labour has backed plans by the Scottish National party to mitigate the impact of the two-child limit, which are likely to commence next year. Without change in England, JRF analysis suggests that will mean child poverty falling north of the border, while it continues to rise, from already “shameful” levels, in England and Wales.

Some older, wiser heads in the Labour movement fear Downing Street may be underestimating the scale of the backlash it could face, not least from broadly loyal MPs, if it tries to kick the urgent issue of child poverty down the road.

The child poverty strategy was promised in the spring, but some in Whitehall suspect it is now more likely to sit alongside the spending review, which concludes in June.

Whenever it comes, Labour should seize the moment to show it is not just keen on bridges, roads and runways, but grasp the importance of cherishing another key national asset: our children.

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