A blog by Luke Akehurst about politics, elections, and the Labour Party - With subtitles for the Hard of Left. Just for the record: all the views expressed here are entirely personal and do not necessarily represent the positions of any organisations I am a member of.

Friday, January 04, 2008

IPPR on the "working poor"

A quick plug for the IPPR pamphlet published yesterday written by Hackney North Labour Party member Graeme Cooke.

Entitled "Working Out of Poverty: A study of the low-paid and the ‘working poor’" it exposes the way that whilst as a Government we've managed to get people into work, in many cases this has not taken them out of poverty because of the way the benefits system is structured e.g. you get housing benefit if you are workless but lose it once you get a fairly low paid job.

Useful research and hopefully being read by DWP Ministers.

You can download it here:



Anonymous Anonymous said...

No Luke - let's hope it's not being read by DWP ministers (or, God forbid, Treasury ministers). If they take the actions in this report, we'll miss the 50% reduction in child poverty target. DWP and Treasury ministers should read this report from JRF, which works it out in detail and which the entire anti-poverty sector in the UK has united around:

I like Graeme Cook, and I've worked with IPPR, but on this they are providing at best an unhelpful diversion and at worst an alternative and much less effective set of activities. We've between now and the budget to get the £4bn we need; IPPR could have chosen a better moment to publish their interesting musings.

9:53 am, January 04, 2008

Anonymous Anonymous said...

Interesting that deceit-minded attack dogs who hide behind targets to gloss over the fact that this government has presided over a halt in social mobility, never mind tackling wider poverty than just a few Sure Starts, choose to come here and slap down Akehurst for daring to question its record.

10:21 am, January 04, 2008

Anonymous Anonymous said...

Hi anonymous - do we know each other?!

I disagree that our report is a distraction from efforts to reach the 2010 child poverty target.

The government's child poverty strategy to date has essentially been two-pronged: supporting parents into work and directly transferring money to poor families through tax credits and benefits. These have helped to cut worklessness and boost the incomes of the poorest families - and we need more of both in the years to come.

However, despite the real progress that has been made, half of all poor children now live in a family where at least one of their parents work. We argue, therefore, that the child poverty strategy needs a 'third leg' which is about what happens to people (and families) when they move into work.

Our research found that 1 in 5 workers in the UK earns less than the equivalent of £12,000 a year for a full-time working week (or £6.67 an hour). The minimum wage has been a massive success, but having so many people earning so little is the largely unspoken factor underpinning our high rates of poverty and inequality.

Beyond the minimum wage, there is precious little debate about low pay - which requires action from government, employers, trade unions and all of us as citizens and consumers. What about 'fair wage' clauses in government procurement contracts? What more could trade unions do to organise in low wage sectors? What combination of regulation and support can help employers boost productivity and therefore pay higher wages? How can the welfare and skills systems be better focused on helping people develop careers not just get the first job that comes along?

I think opening up this debate about fairness and opportunity at work is an essential complement to the government's redistributive efforts (especially in a tight financial climate) if the child poverty targets are to be hit.

Cheers, Graeme

11:25 am, January 04, 2008

Anonymous Anonymous said...

socialdemokrat - not an attack dog, work in an allied field so can't put my name to personal thoughts, that's all. Oh, and we're not talking about social mobility, we're talking about poverty. They're different - I care about one and not the other.

Grame - we've met a few times. I agree that the strategy up til now has been two-pronged (which I imagine both you and I support). However, after the move at DWP from concentration on redistribution to concetration on welfare reform, progress on child poverty stalled (the pattern is hard to discern as child poverty figures are published in arrears, but it's certainly there). This leaves us in a situation where a two-pronged strategy to the 2010 target no longer works, as the second prong (more parents working) will not have the effect it needs to in time. So, having now had a chance to read your paper, I can see that it is a useful contribution to discussions around making work pay, which in an of itself is hugely valuable. But I stand by my contention that in a situation where the best tool we have is a target; where we have two years to get to it (though of course three until we know whether we have); where getting more people into work won't produce the results required in time; and where people who know and campaign for change on this have all decided to get together and say the same thing - £4bn on tax credits and benefits, the prong that will work - the timing and tone of your report is unhelpful.

Yours ever, etc.

12:30 pm, January 04, 2008

Blogger donpaskini said...

Hi Graeme,

I think the bits on low pay in your report are good, though the biggest weakness in the government's approach on pay is that there is a lot about what government can do, a lot about what people seeking work will be forced and encouraged to do, and very little about what employers could and should do - I guess more on this will be covered in a future report?

It's the spending priorities which the report calls for that are more problematic. You suggest spending £1.6 billion on more money for couple families to help 200,000 children out of poverty. But Donald Hirsch and co. found that spending £4 billion on more child tax credit and extra help for larger families would help 1 million children out of poverty (link as per 'anonymous' comment), which sounds like more effective use of scarce resources to tackle poverty.

Be interested in your thoughts about why raising the couple element of tax credits is a higher priority than the £4 billion suggested by the JRF report which the End Child Poverty Coalition are campaigning for (though, of course, there is nothing stopping the government from implementing both your ideas and what End Child Poverty is calling for).

1:13 pm, January 04, 2008

Anonymous Anonymous said...

There are a couple of reasons why I don't agree that our proposals are at odds with efforts to get to the 2010 child poverty target.

Firstly, we suggest that the increase in Working Tax Credit for couples be paid for by removing child tax credit from middle income families (those eligible to just the family element or less - the majority of whom have incomes above £30,000 a year). We are not calling for this to be new expenditure (where the priority is - as you say - the child element of the child tax credit).

What our report is trying to do is shed new light on one aspect of the child povetry agenda - 'working poverty' - that up to now has had little focus. Working poverty is overwhelmingly an issue for low-income couple families and therefore we argue that specific measures for this group are necessary and justified.

Also, looking beyond 2010 to 2020, there is no prospect of ending child poverty simply through financial transfers (or what you might call 'remedial redistribution') - either politically or economically. What we need is a renewed focus and action to address the underlying level of inequality in the labour market - through an agenda about low pay, ladders of progression and fairness at work.

The aim of this ippr report is to contribute to the debate about child poverty in the UK by highlighting the extent of 'working poverty' while suggesting some potential short term and longer term solutions.

I hope that it is read in this spirit

Cheers, Graeme

10:04 pm, January 06, 2008

Anonymous Anonymous said...

Perhaps there is another more sensible way of looking at this Luke.

Millions of migrant workers are keeping the poorest paid poorly paid. So despite being in work they can't afford to live on the min wage, which by all accounts does not fit the cost of living.

Inflation is the key says Gordon, we need a cheaper workforce says the CBI. Whilst beating inflation Gordon has denied many working people the abililty to get a better pay deal. It all comes down to supply and demand.

Tax credits now subsidise the worst employers. What a disgrace, for a working person to rely on handouts to support his family and what will these people do when the conservatives remove the tax credit system.

What now for Gordon now inflation is creeping. Can he cheapen our labour anymore...

Gordon if you read this hang your head in shame and don't rely on our support ever again.

12:02 am, January 07, 2008


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