Child Poverty In Scotland

Sandra Osborne (Ayr, Carrick and Cumnock) (Lab): I begin by congratulating the Scottish Affairs Committee on its valuable work on poverty. It is some years since I was a member of that Select Committee and a great deal of work has been done subsequently. We all know that the life chances of too many Scots have been strangled at birth, so it is timely to take a look at how far we have come, what progress has been made and where there is room for improvement.

It was Labour in opposition that led the assault on the scourge of poverty under the Tories; it was Labour that provided a detailed analysis of the root causes of poverty under the Tories; and only Labour had the underlying values and ideology to address poverty in government and to make real progress in tackling poverty in Scotland and in the UK more widely.

Child poverty is of the utmost importance because in eradicating it we are paving the way for a society in which for the first time every child has a chance in life—a chance that will not lead to a dead end. Childhood poverty leads, for the most part, to lifelong poverty. Even those who escape financial poverty are left with the scars, which is why we hear so many Scots
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from working-class communities saying that they will never forget where they came from.

As we have heard from many hon. Members today, poverty needs to be addressed in all its aspects, because they are all interlinked. Unemployment, low pay, pensioner poverty, family poverty, women in poverty, the disabled, poor housing, deprivation, education, class and inequality, poverty and ill health are all connected and must all be addressed. Labour has recognised for decades how important all those issues are, but only when in power has it been able to start to do something about them. Therein lies a lesson for us all on the Labour side.

We have heard the statistics that show how well the Government are doing in tackling child poverty. We have heard about the record rises in child benefit, with 600,000 taken out of poverty—impacting even more in Scotland, which started out with higher poverty levels. As we have heard, that has received a warm welcome from many organisations in civil society in Scotland, including Barnardo’s, the Child Poverty Action Group, Citizens Advice Scotland, the Church of Scotland and Save the Children. Statistics can be boring, but they matter to the individuals whom they affect: the person who has seen his or her income rise substantially thanks to the minimum wage, or the lone parent who now has a living wage thanks to the working tax credit and affordable child care. The Government’s approach has been, and as we have heard from the Minister will continue to be, targeted support for those who need it most, work for those who can, breaking the cycle of deprivation, and delivering high-quality public services. That is a long-term approach that will bring about long-term change, to offer every individual and every generation the opportunity and support to raise and fulfil their aspirations.

Where I grew up, we had few aspirations and even less chance of realising them. Then the Tories came along, and we were completely scuppered. It is a positive fact that the aspirations of most young people now are entirely different from the hopelessness of the 1980s. Scotland has moved on, but still too many are left behind. We are making a difference, as the Select Committee’s report acknowledges. When the Government are criticised, it is usually for not doing enough, and not doing it quickly enough, not for doing nothing, as was the case with previous Tory Governments.

The Committee’s report and the many organisations that have briefed us for this debate all make the point that progress has stalled, so that must be our main focus. Nevertheless, it never does any harm to highlight, as a starting point, what has been achieved and can be built on. It seems that there is a consensus now that it is not a question of if, but how and when. What a change that is from the days in poverty under the Conservative party, which seems to have a new-found concern for the issue. As other hon. Members have said, that is certainly welcome, but will they put their money where their mouth is and commit to public spending on the issue? In Scotland, will the Scottish Government make the hard decisions needed to protect the most vulnerable in our country, who are not always popular causes, or will they play to the gallery?

I can remember standing outside jobcentres in the ’80s, gathering information on jobs advertised at 80p an hour, in the fight against low pay. In 1997, my
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predecessor Phil Gallie said that it was okay for someone to be paid £1.50 an hour if that is what the market dictates. That is why it was no imposition for me—unlike some other hon. Members—to stay up all night to see the national minimum wage passed through the House. But I also say to the Government that that is why there is unfinished business such as the Temporary and Agency Workers (Equal Treatment) Bill, which practically all Labour Back Benchers were here on a Friday to support. We all look forward to its being passed, because it is part of the jigsaw—it is about not just fairness but tackling child poverty. As the Committee says in its report, where work is of poor quality, low- paid, short-term or seasonal, in-work poverty is a real prospect.

I remember when, as a young mother, you could not get a pre-school nursery place in Scotland for love or money. There was not one recognition from the then Government that child care or nursery provision had anything to do with them. The Tory Government thought that it was all down to the family—of course, they could all afford nannies. It is a proud achievement that pre-school education is now a statutory obligation; it is just as well, because otherwise it would be likely to be cut, as happened in the past.

I was disappointed to read the comments yesterday of my Labour colleague, Scottish MSP Rhona Brankin, that the Scottish Government look set to water down a commitment to the provision of more nursery teachers. As my hon. Friend the Member for Aberdeen, South (Miss Begg) has said, the money for nursery places for vulnerable two-year-olds will not now be found.

We all know that poverty is also gender-specific. While we support lone parents back into work, we should also remember that women are still paid on an unequal basis with men. It has been shown that equal pay will not happen on a voluntary basis, and we now need statutory equal pay audits. Equal pay would go a long way towards helping with child poverty.

As the Committee said, there is more to do, and its report outlines several recommendations that are well worthy of consideration if the target to halve child poverty by 2010 is to be met. I agree with its finding that we should consider the equalisation of child benefit for all children and families, as suggested by the hon. Member for Argyll and Bute (Mr. Reid), especially given the impact that that would have in lifting a further 30,000 children out of poverty. However, that prompts the eternal question of targeted benefits versus universal benefits. As we are all aware, everybody gets child benefit but it does not necessarily target resources in the best way. Contrary to what I have heard in this House several times recently, take-up of tax credits for families with children is higher than under any previous system of income-related support for in-work families, with take-up among those with incomes of less than £10,000 now at 97 per cent. in the UK, according to the Government’s figures. It may be that increasing tax credits would be the best way to tackle poverty by releasing resources to those who need them most.

Last week, the church and society council of the Church of Scotland met us in the House. The council has made proposals on tackling debt, focusing on the need to find alternatives to the high-interest doorstep
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lenders who often target families with young children. It calls for an effective, flexible alternative through the social fund and supports the Committee’s recommendation of empowering courts to fix a reasonable cap on interest rates, as in many other European countries. I know of other areas where such help has been extended through the voluntary sector by a crisis loan facility for priority debts paid through the local credit union. That has proved to be a very effective mechanism, and I would like the Government to give consideration to how it can be promoted.

We need to heed the Save the Children report, which shows that the poorest families pay £1,000 per year more for services because they do not have access to low-cost credit, fair banking or direct debit; and we are only too well aware of the extra costs of prepayment meters for fuel. I welcome the fact that Ofgem is considering that, and we all hope that this unfairness will be ended. We also need the restoration and expansion of free-to-use ATMs, not just the offers made in recent times by the very banks who removed them in the first place.

We must take seriously evidence from the Joseph Rowntree Foundation that the present system of uprating tax credits, benefits and allowances lags behind average incomes every year. That is reinforced by the Child Poverty Action Group’s view that the minimum wage, in-work tax credit and benefit support must be raised so that no child in a working family is left in poverty. Most of the charities have endorsed the Committee’s view that the tax and benefits system must, at a minimum, ensure that no one in full-time work is living in poverty. Almost half the children in poverty are in families in paid work. I welcome the pilots that will start in the autumn of the better off in work credit to ensure that everyone who has been claiming benefits for at least six months sees a gain from working of at least £25 per week. That is a modest measure, but it is a recognition that work, as the best route out of poverty, will be of benefit only if it is worth while working in the first place.

The Government have laid the foundation for the eradication of child poverty, and the direction of travel is now well established. However, I would like to raise with the Minister a couple of issues that have arisen in my constituency and are pertinent to the debate as well as to those living on a fixed income throughout the country.

First, I am grateful to Dr. Calum McCabe, one of our local GPs, who has brought to my attention a problem experienced by some of his patients in accessing benefits by phone. As we all know, many people on fixed incomes do not have landlines and instead use pay-as-you-go mobile phones. They may be more expensive in the long term but, like prepayment meters, they are used because they mean that people on fixed incomes do not run up bills. Many Government-run helplines—such as the ones for tax credits, benefits inquiries and the social fund—use numbers with the 0845 prefix that are assumed to be free or local-rate numbers. However, mobile network operators connect customers to the services at premium rates, with the result that low-income users who have no access to a landline incur disproportionate costs in accessing taxpayer-funded services.

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I draw the Minister’s attention to early-day motion 1285, which has been signed by 65 hon. Members of all parties. It calls on the Government to bring in legislation so that the numbers are genuinely free to all users. It also asks the Government to look into providing free of charge at the point of use all essential Government-run helplines for which no alternative face-to-face service is provided.

Secondly, I want to refer to a constituent who lost her partner of 24 years in a tragic accident. They had two children, who are now aged seven and two. Although they were not married, they had been together since schooldays and their relationship outlasted many marriages. She sought financial help from the Government through the bereavement payment and the widow’s parent’s allowance. In a very blunt telephone call, she was informed that she had a very slim chance of success, as 99.6 per cent. of claims fail. She was told that, if she wished to proceed with the claim, she would be interviewed by two assessors. She would also have to furnish them with cards that showed that she and her partner had been related as husband and wife. Finally, three witnesses would be questioned about their belief that the couple were married.

It beggars belief that anyone should be subjected to such an insensitive, intrusive and discriminatory process at such a vulnerable time in her life.

Mr. Carmichael: A constituent of mine has been in exactly the same position and has experienced exactly the same treatment. The test that is applied was used in the past to establish whether a marriage under Scottish common law—that is, marriage

“by cohabitation, with habit and repute”.

It is nonsensical to use that as a test for a benefit. Will the hon. Lady join me in encouraging the Under-Secretary of State for Work and Pensions, the hon. Member for Stirling (Mrs. McGuire), to take an urgent look at that test? It is out of date, and it causes severe anguish and embarrassment to many constituents.

Sandra Osborne: I agree with the hon. Gentleman. I was going to say that I am aware that only people in Scotland can apply for those benefits, thanks to the provisions of Scottish law. People in England cannot do so.

My constituent feels that a mockery has been made of her family, even though she and her partner worked all their lives and had no recourse to public funds. It is all very well to talk about marriage, but we all know that many couples live together. There are many different family forms in society today, and this debate is about addressing child poverty; it is not about making moral judgments about whether people are married or not. The problem that I have described has lasted a long time, and I do not expect the Minister to solve it today, although I hope that it can be addressed urgently. However, I shall seek the support of colleagues on all sides of the House to try to get the system changed.

The problem faced by my constituent illustrates how poverty affects people in different ways. It can happen to anyone at any time. People struck by poverty are treated differently, and their children suddenly become vulnerable. Their right to live as they choose can be undermined or taken away. That may seem a small matter in the grand scheme, but life is not all about
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money—it is also about dignity and respect. Those two qualities deserve more attention from the Government, as in different ways the lack of either can make vulnerable people poorer, whether they are adults or children.

Generally speaking, however, I believe that the Government have laid the right foundations for tackling poverty, both in this country and, thanks to the work carried out by the Department for International Development, around the world. Part of our core belief is that poverty is an enemy to be taken on and defeated wherever it can be found. I had intended to elaborate on that point, but as a colleague was pulled up earlier for straying too far from the subject, I shall not do so.

In the past five years, Scotland’s health spending has increased by 50 per cent. under Labour. Waiting times are down from 18 months to 18 weeks, and the number of deaths from heart disease has fallen by 30 per cent. With a new emphasis on prevention and a focus on community services, Scots are just as likely to be kept alive and healthy by the paramedic’s emergency treatment, the primary care worker who identifies high cholesterol, the teacher who gives a child the basics of a healthy diet, or Government legislation such as the smoking ban as they are by the skilled work of a surgeon.

Scotland has seen improved services for all, but with a focus on those who need them most. Underpinning all our policies on health is a clear understanding that good health needs good housing, good health needs good education, good health needs full employment and shared prosperity, and good health needs people to be lifted out of poverty. The good health of our children depends on the progress that we make on all those fronts. Year on year, we have invested in health. In fact, Scotland has been ahead of the United Kingdom in terms of health spend. But now, in the short time during which the Scottish National party has been in charge in Scotland, we are falling behind. The SNP’s increase in health spend is half that of Labour.

An issue that concerns me at present is the impact of the new report on national health service resource allocation in Scotland, which was produced by the NHSScotland resource allocation committee and is now with the Scottish Government. It proposes replacing the Arbuthnott index, which takes deprivation and poverty factors into account when determining resources, with a new formula that will not take unemployment rates into account as an indicator for the additional-needs element, with the result that in my area, Ayrshire and Arran, the NHS stands to lose £5 million in its annual allocation. That was challenged in evidence given to the committee by the Scottish directors of public health, who argued that unemployment rates were a relevant factor in themselves in the assessment of health needs in an area—not just for those who are unemployed, but as an indicator of additional need throughout the geographical area. They have been ignored.

The link between health and poverty cannot be taken for granted. Many of us remember how hard we had to fight for it to be recognised in the first place. We should not accept anything that dilutes that link when we still have a Scotland where twice as many children in poorer areas die in infancy or fall ill as do so in more affluent areas. There is already plenty of evidence that the SNP
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will talk a good game about the priority of health, but ultimately constitutional wrangling will always be their chief end. Good health, better housing and better care services are pawns in their game of picking fights with Westminster. In Scotland, Labour will have to take up again the role that it played in the Thatcher years, and be there for the NHS. We cannot assume that it will be safe in the hands of the SNP.

As many have said today, tackling poverty in Scotland requires a partnership between the United Kingdom Government, the Scottish Government, local authorities and the voluntary sector.

Mr. MacNeil: Does the hon. Lady welcome the fact that accident and emergency units were saved by the SNP Government?

Sandra Osborne: I do, but unfortunately they were saved at the expense of a new cancer care unit and two community health facilities which were supposed to bring health care much closer to the community. I certainly do not welcome that loss incurred by my constituents.

As was acknowledged in the committee’s report, under a Labour leadership we have been able to make real advances in recent years, but with an SNP-led Scottish Government, that has already been put at risk and is starting to unravel in many places. Making a cut in business rates and giving nothing in return may appeal to the Tories as a sensible flagship policy, but it has not given me the sense of an SNP Government prioritising social justice and committed to eradicating poverty. Twinning that with proposals to freeze the council tax without a proper and serious strategy to ensure ongoing support for groups who rely on local government funding may also seem perfectly sensible to the Scottish Tories, but it puts at risk a very successful partnership between national and local government and the voluntary sector to tackle poverty.

David Mundell: I am interested to hear what the hon. Lady is saying, and some of her points are very relevant. Perhaps she would explain why her colleagues in the Scottish Parliament abstained on the SNP Government’s Budget.

Mr. Deputy Speaker: Order. I hope that the hon. Lady will not go down that road. I have not heard too much on the specific subject of child poverty in the past few minutes of her speech. I hope that she will bear in mind the fact that other colleagues are anxious to participate in the debate.

Sandra Osborne: I take your point, Mr. Deputy Speaker, and I shall try to be as quick as possible, so that other hon. Members may speak.

Councils in Scotland are already having to make cuts in budgets and services to balance the books, and such problems are worse for councils whose areas have high levels of poverty and population decline. They receive the lowest increase in core grant funding. I am talking about authorities such as East Ayrshire council.

I understand why councils have welcomed aspects of the concordat, for instance the reduction in ring-fencing, for which many of us have argued over the years.
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However, a settlement that cuts finance year on year and is some £400 million less than the Convention of Scottish Local Authorities estimated it required will inevitably mean that councils will have to preserve statutory services at the expense of other priority services that are not statutory—services such as welfare rights and debt advice, and services commissioned from the voluntary sector. Such services together provide vital anti-poverty work that complements the UK’s anti-poverty measures. Many of the most innovative projects are in that field—for example, providing support to credit unions, financial literacy activity and providing families with extra form-filling support.

Parts of my constituency need a major expansion of basic welfare rights and advice services, rather than for those services to be put under threat. For example, South Ayrshire’s welfare rights service have been cut, and what is left is under threat. That is hardly the way to ensure income maximisation.

Michael Connarty (Linlithgow and East Falkirk) (Lab): My hon. Friend is listing some of the cuts that are occurring and will affect the most impoverished. Does she realise that just this week I have been contacted by the adult learning partnership in Scotland, which has been told that it is not going to be funded—

Mr. Deputy Speaker: Order. The hon. Gentleman has come into the debate just at this juncture, and he makes an intervention when we are talking about child poverty. I do not think that adult learning is directly connected at this particular point.

Michael Connarty rose—

Mr. Deputy Speaker: I so rule.

Sandra Osborne: In conclusion, may I cite the introduction to “Scotland the Real Divide”, which was published 25 years ago? It states:

“Scotland’s poor are therefore not poor because they are Scottish; they are poor because, if they are not unemployed, they are in the wrong job, generation, sex or class”.

That publication was of course edited by the Prime Minister and the late Robin Cook. Our strength in achieving what we have already achieved in tackling child poverty and our confidence in our ability to achieve much more—ideally, our target of eliminating child poverty by 2020—is rooted in our values and our analysis. We do not tackle poverty, be it at home in Scotland, in the UK or on the world stage, as a by-product; we tackle it as a priority.

Mr. Deputy Speaker: Order. The average length of Back-Bench speeches is running at 22 minutes. There is a limit on our time, and I believe that seven hon. Members are still seeking to catch my eye. If we go on at that rate, clearly many people will be disappointed. I hope, therefore, that hon. Members will hold to the forefront of their minds the fact that this debate is about child poverty.

3.58 pm
Mr. Angus MacNeil (Na h-Eileanan an Iar) (SNP): I hear your words clearly, Mr. Deputy Speaker: this debate is about child poverty. I hope that my contribution will be brief, succinct and to the point.

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We serve on a friendly Committee, under the good chairmanship of the hon. Member for Glasgow, Central (Mr. Sarwar), to whose work I would like to pay tribute. He does a good job, his approach is very inclusive and he is most kind to all Members, regardless of party or political persuasion. That is important to note.

I would like to say that it is a pleasure to be taking part in this debate—but I would much rather not be taking part in such a debate. Such a debate should no longer be necessary, just as debates about children sweeping chimneys need no longer occur. Those are things of the past, and I wish that child poverty, too, was a thing of the past.

Child poverty in Scotland, or in any European or first-world state, should be a thing of the past. Perhaps if international prestige were measured by the equity of society, or by low levels of child poverty, the nations that currently vie for influence on the world stage might be higher in the UNICEF table covering the well-being of children in rich countries. I refer, of course, to the United States of America and the United Kingdom, which prop up that table, just below some former eastern European bloc states. The Netherlands, Sweden and Denmark lead the table, incidentally.

The conclusions of the report by the Scottish Affairs Committee might be a good place to start. Progress has been made since 1997, and we all recognise and welcome that. Progress continues to be made, although its pace may be slowing. The report states, on page 29, that the 2010 target of lifting 50 per cent. of children out of poverty will be missed, even if the uptake of tax credits improves. We all know about the difficulty of ensuring that targeted benefits hit their target.

The first recommendation of the report shows concern because there is a slowdown in poverty reduction in the UK, but it should be noted that Scotland is doing a little better. However, much of that apparent success may well be attributable to the poorer baseline from which Scotland started. It is still notable that the rate of child poverty in Scotland is still higher than the average for the UK.

It is also clear that the main levers to address child poverty are held by the UK Government. That was emphasised by numerous witnesses to the Committee, who said that the UK Government held all the cards. Among those witnesses was Guy Palmer from the Joseph Rowntree Foundation, who said:

“The big policy levers are the non-devolved levers to do with tax and benefits.”

That was echoed by Joe Connolly from NCH, who said:

“It is not for the Scottish Executive, as it was known, but a UK issue.”

Nevertheless, the Government of Scotland, not content to wait for the adjustments of a lumbering ship of state to deal with the matter, have their own plans to tackle poverty, inequality and deprivation. To be fair to the previous two-party Government in Scotland, they did much the same—or at least tried to. Governments everywhere are united in efforts to reduce child poverty, which is a blight on any society, especially Scottish society. That more than 20 per cent., and perhaps even 25 per cent., of children live in poverty is surely a challenge for us all, regardless of political persuasion and regardless of where we live. This is a problem for nations throughout western Europe.

Perhaps if we all believed in reincarnation, so that we would have a one in four chance of being caught up in poverty in the next life, we might make more urgent and pressing efforts to address it. I shall leave that for others to ponder—