Politics

How Britain can tackle poverty

BY Philippa Stroud   /  21 January 2019

We have no official measure of poverty in the UK. The government ceased to use its previous measure of poverty in 2016, and despite much debate on both the left and the right, a new measure has yet to be agreed. This should concern us all because it has become all too easy for successive governments to argue about the measurement of poverty, rather than delivering an effective strategy to tackle poverty. Meanwhile the very poorest in Britain – the bottom 20% – have seen no significant improvement in their life circumstances over the last two decades.

I have long argued that Britain needs an agreed measure of poverty as the best way to focus us on the important task of targeting policy to reduce poverty and provide support to those in poverty. What gets measured in government gets done.

I therefore established the Social Metrics Commission (SMC) with the sole aim of developing new measures of poverty for the UK. From the start, it was clear to me that developing a metric was not enough; we also needed to build a new consensus around poverty measurement and action. To do this, I brought together top thinkers from left and right, with policy and measurement experts. Over two and half years, we all shared our personal views and experiences, undertook significant analysis, research and stakeholder consultation to create a completely new approach to poverty measurement for the UK that we launched in September 2018.

The Commission’s work has significantly improved our understanding of who is in poverty in the UK, and the nature and life experiences of those living in poverty. For example, the metric includes groups of people previously omitted from poverty statistics, like those living on the streets and those in overcrowded housing.

We now have a more detailed picture of exactly who is poor, and the range of factors that can detrimentally impact on their lives – the lived experience of poverty. The metric accounts for the available assets that families have, as well as their net income and the inescapable family-specific costs that reduce the ability of families to meet their day to day needs. The impact of this is significant; for example, because we include the extra costs of disability, our approach finds that nearly half of the 14.2 million people in poverty live in families that include a disabled person.

This approach is a significant departure from previous measures, which have tended to focus on incomes only and, as a result, have failed to adequately consider the impact that high inescapable costs (such as childcare) and a lack of financial resilience (such as savings) have on families’ lives.

Our challenge now is to make a real impact on policy, to improve the lives of people living in or close to poverty. To do that, we propose that the Government adopts the SMC as its official measure of poverty as soon as possible. This would end the arguments about measurement and bring policymakers together to address the issues, highlighted in our report. You can read it here.

The Prime Minister has written to encourage me to engage with the government so that we work together to advance this agenda. So, I am delighted to report that the chairman of the House of Commons Work and Pensions Select Committee, the Rt Hon Frank Field MP has just asked the SMC to draft a bill to put the measure into law, as the official measurement of poverty. I have also tabled a Parliamentary debate for today (21st January) to provide an opportunity for the Government to discuss the value of adopting the SMC as its measure.

This would be an important step forward and is now urgent. The SMC report highlights that 7.7 million people are living in persistent poverty. These people have spent all or most of the last four years (and more) in poverty. Persistence rates are particularly high for children and working-age adults who live in workless families and families with a disabled person. This is of serious concern.

The cost and impact of disability have been completely overlooked and I believe it is time to establish a Disability Commission to study how all disabled people can thrive in our society. We also know that long periods in poverty can be particularly damaging to people’s lives, mental health and prospects. This is also a significant concern that requires action.
I ask the government to adopt the SMC measure of poverty so that we can put all our energy into tackling poverty and supporting the most vulnerable in this country.

Baroness Philippa Stroud is Chair of the Social Metrics Commission and CEO of the Legatum Institute