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Child poverty – how we can meet this major social challenge through innovative thinking and practice

Submitted by on 22 Nov 2010 – 16:32

By Matthew Horne, Managing Partner at Innovation Unit¸ a social enterprise supporting leaders and organisations that deliver public services

Jack is two years old. He lives with his mum, Alison, in a council house in south London. His dad left home about a week after Jack was born, and now lives nearby with his new wife and baby. His mum has never had a lot of money. She has found it difficult to get a job, despite training as a hairdresser. She currently receives income support, child benefit tax credit and housing benefit (which goes straight to the landlord). She gets £5 per week from Jack’s dad to help look after Jack. Debt is a constant worry for her. She owes over £2,000 to a furniture catalogue company, a credit card company, and to her landlord. Her house is not furnished with luxuries, in fact it is quite bare, but she needed essentials like a bed, a washing machine, a sofa and taking out loans made it possible

The Child Poverty Act 2010 passed into law a duty on the government to meet four targets to eliminate child poverty by 2020: a relative low income target, a material deprivation target, an absolute low income target, and a persistent poverty target. The headline interpretation of this is to have fewer than 5% of families living below 60% of median income.

Alison and her son, Jack, are one of those families. They are currently living in poverty according to the government’s definition. While some want to redefine the official target of child poverty; anybody who spent an afternoon with Alison and Jack would agree that improving their situation, their income and their life chances is critically important not just to them as individuals, but to the future of their community, neighbourhood and to our society.

What then should be done?

The first approach is effective but expensive: sse the benefit system to increase financial support to poor families. The last government increased financial support to poor families significantly. However, this is not a sustainable solution for families like Alison and Jack. Higher benefits will not ensure that Jack can fulfil his mum’s aspirations for him, nor will it help her return to work, buy a house or retrain at college. It is also very expensive, at a time when government is looking to spend less not more.

The second approach sounds simple but is very hard to get right: make work pay by removing benefit traps that mean that people are better off not working. The withdrawal of benefits combined with low wages for low skilled and insecure work creates a perpetual dilemma for parents like Alison whose primary concern is to bring up Jack as best she can. Cutting the value of some benefits is politically very painful but is probably easier to achieve than the other side of equation, which is to ensure that Alison and other low income parents do not get caught in a different form of trap: low skilled, low paid, insecure work. Some countries, such as the US and Portugal have much lower levels of worklessness among families, and lower levels of benefit dependency but they actually have higher levels of child poverty – parents work, but are still poor.

The third approach requires government to let go and encourage innovative local solutions. Innovation Unit conduct many ‘horizon scans’ to find examples of great local innovations that are improving outcomes for children living in poverty. It could be about an individual project in Australia that provides support and guidance to improve children’s educational development. Or it could be a Canadian government funded programme to offer deprived and ‘at risk’ young people the chance to volunteer in a six month long scheme. It may be something much larger, such as an entire ‘children’s zone’ in Harlem, US, that unites a vast array of services under a distinctive brand, many of its services requiring the active participation of families.

These innovations recognise that child poverty is a complex social problem. Unfortunately it is not immediately eradicated simply by raising benefit incomes, nor is it eradicated simply by shifting people off benefit and into any kind of work. The coalition government is grappling for an economic policy that delivers both growth and jobs in poor areas as well as rich areas, and it is seeking to create a benefit system that helps people out of poverty rather than keeps them in it. In all likelihood the process will take years. In the meantime, local innovators and local policy makers must get creative in developing local solutions in health, education, early years and family policy that work for families like Alison and Jack. It might seem like a difficult time to be creative and innovative in the face of budget cuts. But our experience working with local authorities is that offering practical steps for delivering better services that really make a difference to families living in poverty is a mobilising and energising process. Innovation is needed now more than ever.