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Child Poverty Bill

Volume 716: debated on Monday 25 January 2010

Committee (3rd Day)

Schedule 1 : The Child Poverty Commission

Amendment 22

Moved by

22: Schedule 1, page 18, line 5, at end insert—

“( ) the member is unfit for office by reason of misconduct,( ) the member has failed to comply with the terms of his appointment, or”

My Lords, as noble Lords will know, it is with some regret from my perspective that we do not have the chance to go back and debate the black economy—or informal economy—amendment again.

Amendments 22 and 23 seek to insert in the Bill powers that appeared in several pieces of recent legislation establishing similar independent bodies. I am curious as to why the Bill did not contain the usual wording. I appreciate that there are often small discrepancies between different Bills, but these provisions seem exceptionally pared down. I wonder whether the Minister is able to give us more clarity on what sort of behaviour would be considered a firing offence under these provisions. Given that the Government’s view of the commission is for it to be facilitator of government policy-making, what would happen if the Secretary of State were to conclude that the commission’s advice was not in line with the department’s assessment of government policy?

The Secretary of State for the Home Office recently removed the Government’s drugs adviser from his position as head of the independent expert body—the Advisory Council on the Misuse of Drugs—because of public comments disagreeing with government policy. That body was established under a 1971 Act which, as far as I can see, does not contain provisions on the removal of a member. Does that mean that the chair of this commission will be in a stronger position than the unfortunate Professor Nutt? Will he or she be able to publish criticism without putting their job at risk?

If these provisions give the chair a greater level of immunity, what will the consequences be if the commission and the Secretary of State do not agree on the appropriate strategy for reaching the targets? Constructive criticism can be taken too far. If the commission insists on taking a radically different approach to meeting the targets and refuses to work with the Secretary of State, we would agree that the Government must remain ultimately accountable. I am sure that the Minister would agree that if the chair of the commission is not aiding the Secretary of State in the formation of policy, the necessary steps should be taken. Can the Minister confirm that that would be possible under these provisions? I beg to move.

My Lords, I hope that I will be able to give the noble Lord the assurances that he is looking for. First, I shall speak to Amendment 22, which is intended to add two further grounds for removing a member of the commission to paragraph 6 of Schedule 1—removal due to misconduct or a failure to comply with the terms of appointment. I agree with noble Lords that a future Secretary of State must have sufficient powers to remove a member of the commission if it transpires that they are not fit to serve in that office. I am therefore happy to confirm that the existing provisions within paragraph 6 of Schedule 1 will allow the Secretary of State to remove a member on these grounds.

In particular, the provision in paragraph 6(d) empowers the Secretary of State to remove a member should he be satisfied that the member is “otherwise unable or unfit” to perform his duties. This gives the Secretary of State the power to remove a member on the grounds both of misconduct and failure to comply with the terms of his appointment. The noble Lord raised the example of Professor Nutt. In that case, the Secretary of State was confident that he was empowered to remove that person on the basis of his not complying with the terms of his appointment.

The provisions of paragraph 6 of Schedule 1 follow precedents set in other legislation setting up advisory public bodies, such as the National Minimum Wage Act 1998, which established the Low Pay Commission, and the Social Security Act 1980, which established the Social Security Advisory Committee. As we know, we are talking about an advisory NDPB. With those assurances, I invite the noble Lord to withdraw his amendment.

Amendment 23 is similar to Amendment 22, in that it seeks to ensure that a commission member can be removed if he is unwilling to perform the duties of that office. I reassure the Committee that such a person can be removed using the existing provisions of the Bill. First, an unwilling member could conceivably be absent from a series of commission meetings. In the ordinary course of events, one would expect a member of the commission who was unwilling to perform his duties to resign his office. Paragraph 5 of Schedule 1 provides for him to do so in writing to the Secretary of State.

There may, I suppose, exceptionally be an instance of a person becoming unwilling to serve and at the same time reluctant to offer to leave the body. In such a case, the grounds set out in paragraph 6(d), covering inability or unfitness to perform the duties of the office, are sufficient for the Secretary of State to remove him from membership of the commission.

The noble Lord, Lord Freud, asked about the provisions in these amendments compared with other Bills. The provisions in Schedule 2 are based on previous legislation establishing NDPBs—for example, the Climate Change Act establishing the Committee on Climate Change. If the noble Lord would like to write to me detailing the pieces of legislation that are not included, as he sees it—

I thank the Minister for giving way. It will probably be easier if I enunciate them now rather than putting pen to paper. The wording that we are looking at in this amendment has been taken from the Pensions Act 2008, the Planning Act 2008, the Statistics and Registration Service Act 2007 and the Safeguarding Vulnerable Groups Act 2006.

My immediate response to the noble Lord is that those Acts may not be talking about advisory bodies—that is, the status of the body in front of us today. As he will know, a number of different bodies—statutory bodies, advisory bodies and others—do not fall within either of those definitions. I am very happy to write to the noble Lord and expand on that but at present we are confident that, as it stands, the schedule provides for enough instances for the Secretary of State to feel able to remove someone who is unfit or unwilling to discharge his responsibilities.

The noble Lord, Lord Freud, asked what kind of behaviour would constitute a firing offence. We would consider a commission member to be in breach of their appointment if, for example, they became unwilling to serve on the body or failed to be present for a series of commission meetings. Detailed terms of employment should be set out in a commission member’s contract. Much of this information will be in the contract that the commission member agrees on appointment, not as we see it in the Bill. With that, I hope the noble Lord will feel able to withdraw the amendment.

I thank the Minister for that explanation, but perhaps I may spend a little more time exploring the word “unwilling” in all its manifestations. I am conscious that in this area there are some deeply entrenched differences of approach on how to tackle poverty as a whole. Let me draw a hypothetical example. If we had a Government who were staunchly focused on dealing with the causes of poverty within their strategy, and if one or more commission members believed that the solution lay purely in income transfers, and if there was no support within the commission for the Government’s strategy, despite direction by the Secretary of State, under the Minister’s interpretation, would that constitute unwillingness? If so, could that unwillingness be dealt with by removal from office under the clause?

My Lords, I go back to the principle that this is an independent advisory body. In our debate on Thursday of last week, a great deal of emphasis was placed on the importance of independence in setting up this advisory body. If it is to be independent, the value of the commission will rest entirely on its ability to provide independent expert advice. However, as the noble Lord said, if the Secretary of State feels that the advice that he or she is given is not advice that they can work with or does not move the policy forward, ultimately it will be very much within the power of the Secretary of State to take decisions on what the advice and strategy should contain and on the best way of addressing child poverty.

I do not know whether that directly answers the noble Lord’s position, but it would be unusual for a Secretary of State to continue working with a member or members of a commission who were unable to meet the terms of reference of the work set out, which is within the purview of the Secretary of State. However, there is always space for minority views. The noble Lord will know that often there are one or two people—maybe more—on such bodies who wish to put in a minority report on a particular issue. That can and does happen within the machinery of government. The advice that the commission gives to the Secretary of State will be made public, so it will be clear in the public domain what is and what is not a minority view on the commission. Ultimately, it will be for the Secretary of State to decide which advice he wants to take from his commission and which he does not.

I am grateful to the Minister for that very clear explanation. On that basis, I beg leave to withdraw the amendment.

Amendment 22 withdrawn.

Amendment 23 not moved.

Amendment 24

Moved by

24: Schedule 1, page 18, line 27, at end insert—

“( ) Before requesting the Secretary of State to carry out, or commissioning others to carry out, research on behalf of the Commission, the Commission must have regard to existing research.”

My Lords, this is a common-sense amendment to ensure that the limited resources of the commission are not wasted on duplication but instead are targeted on improving the sum of knowledge available to us. We have already discussed the limitations of the data on which government measures are to be based, and I look forward to the meeting with the Ministers and their officials which I was offered last Tuesday. In requesting additional research, the commission could play an important role in plugging the gaps. Of course, the effectiveness of the power given in paragraph 10 depends not only on the funding made available to the commission but on the willingness of the Secretary of State to allow such research.

I want to confirm the meaning of paragraph 10. Is it saying that the Secretary of State can choose whether to comply not only with a request that the Government carry out research but with a request that the commission may ask another for some work? Must the commission ask for permission before requesting a third party to undertake some research for it? Allowing the Secretary of State to veto any independent research will surely limit the ability of the commission to provide effective independent scrutiny. I beg to move.

My Lords, this amendment gives us the opportunity to recognise the meticulous research work done by a number of units, up and down the country, on the topic of assessing minimum income needs. The University of York, the London School of Hygiene and Loughborough come to mind, and there are others. If further research is needed or commissioned, the experience and expertise developed by those units should be recognised.

This also gives me the opportunity to remember and praise the pioneering work of the namesake of my noble friend Lord Morris of Manchester, Professor Jerry Morris of the London School of Hygiene, who died a few months ago in his 100th year. Not only was he one of the first to recognise the need accurately to define minimum income standards based on need but, throughout his long life, was at the forefront of public health and epidemiological research—most famously, for his work on demonstrating the benefit of exercise in preventing coronary heart disease and the existence and importance of inequalities in health. He will be very much missed by all those involved in promoting public health.

My Lords, I thank the noble Lord, Lord Freud, and my noble friend Lord Rea for their contributions. The Government, like the noble Lord, Lord Freud, are keen that the work that this body does represents not only the finest research that is capable of being provided to Government but, alongside that, value for money.

Noble Lords will be aware that on Report in another place we tabled a government amendment providing the commission with a research capability. We agreed with Members on all sides that this would improve the quality and independence of its advice to the Secretary of State. This provision is now expressed in paragraph 10 of Schedule 1.

In making this amendment, we were mindful of a number of considerations. First, we want to ensure that we have a common understanding of what we mean by “research”. Inviting organisations combating child poverty to speak to commission members and making visits to see what works on the ground and to see and hear the experiences of children and families in poverty are both ways of gathering information that we envisage the commission may wish to adopt. They are certainly among the approaches pressed by a number of respondents to the consultation on the Bill and witnesses in the oral evidence sessions.

I am happy to put on the record today that we see both these activities as already within the scope of the Bill. Resources made available under paragraph 9 of Schedule 1 can include resources to carry out these activities. We envisage making explicit reference to them in the commission’s terms of reference. Furthermore, on allocating the commission’s funding, paragraph 9 of Schedule 1 requires that it is adequately resourced to comply with its statutory duty to provide advice to the Government. The commission will want to draw on the already large body of existing high-quality research into the extent, nature and causes of child poverty. It may also wish to tap into the emerging findings of relevant new research commissioned or conducted by government departments in the normal course of their work. It will, at all costs, avoid duplication.

This model follows the very successful one used by the Low Pay Commission, an advisory body respected for the quality of its research. In practice, we expect there to be an early discussion between the commission and the Secretary of State to agree the areas to be studied, and then commissioning and delivery of an annual programme of work by the Secretary of State on its behalf. Indeed, this is the process followed by the Secretary of State and by the Low Pay Commission when drawing up its annual research programme.

I share the noble Lord’s concern that, in exercising this research power, the commission must avoid duplicating existing research. However, the amendment is unnecessary. Should the commission make a request to the Secretary of State for new research where he is able to point it to existing sources, sub-paragraph (2) of paragraph 10 gives the Secretary of State ample scope to decide not to comply with the commission’s request and to explain his reasons for doing so.

I am also confident that the criteria for membership in paragraph 4 of Schedule 1 are such that familiarity with, and expert mining of, existing material will be natural to its ways of working. In practice, I think it highly unlikely that the commission would wish to use its limited resources to request work that duplicates existing material.

The noble Lord asked me specifically about paragraph 10. The Secretary of State can refuse to comply with a request to carry out research. That decision must be reasonable, and he must explain the reasons behind it. This would apply to research being carried out by the Secretary of State or by others. Ultimately, the Secretary of State has control over the budget. I hope that, with those reassurances, the noble Lord will feel able to withdraw his amendment.

It may be premature to ask, but does the Minister have any sense of what the commission’s overall budget for research might be? What could be done will depend on that. She rightly said that the DWP commissions and produces much admirable research. It is well publicised and I think that we are grateful for it. However, the two areas of research which the department finds harder to access and which we could perhaps steer the commission toward considering are, first, the work undertaken through seminars and journals. It is not DWP research and has not yet been fully and officially published. It is the sort of thing that goes into abstracts of journals. I know that a lot of such semi-subterranean work is being done by social policy and social work departments which never quite hits the light of day but can be important in some of the areas that we are considering; for example, fostering of children.

Secondly, the research that the DWP has done—for example, longitudinal research on lone-parent behaviour commissioned from the Policy Studies Institute, of which I was a trustee—is long-time. When the commission, the Government or civil servants seek an answer to a question, and if one is doing anything other than a 20 or 40 person-focused qualitative interview, it normally takes about 18 months to two years before one can get it. By the time one has found the contractors, negotiated the contract, done the pilot work and evaluation and reported back, the questions have changed. One of the real problems in high-quality research is the picking-up-the-petticoats attitude to quick-and-dirty research which may steer you in the right direction in the interim. Quite often, you want quick answers to show that something is probably going in the right direction, but you will confirm it when the full research has been done.

Will my noble friend consider whether the commission could go into those two areas which the DWP finds hardest to deal with: first, subterranean research and, secondly, quick-and-dirty research, to see whether a policy is steering in the right direction, thereby feeding back into policy development and pilots much more quickly?

I am not entirely clear what “subterranean” is, although I think I know what “quick-and-dirty” is. Will the commission be responsible for evaluating the effects of initiatives as well as research into why?

Yes, it would want as holistic a piece of research as possible. Within the limited resources that it has, I am sure that that would be its aim.

I thank both my noble friends. My noble friend Lady Hollis asked specifically whether we had some idea of the commission’s research budget. The detailed work published in the impact assessment for the Bill showed that a budget in the order of £390,000 per annum would be sufficient to support the work of a Child Poverty Commission that can readily provide high-quality and effective research. This figure is based on an indicative budget for funding research of about £200,000, but that will obviously be looked at.

I was asked whether the commission was responsible as an evaluator. Generally, no—as an advisory body it would not be responsible as an evaluator. I was also asked by my noble friend about subterranean and quick-and-dirty research.

The noble Baroness says that they are totally different categories. The Box tells me that we would expect the commission to look at short-term research projects as well as longitudinal projects, if that is appropriate. The Secretary of State can ask the commission to look at any research matter relating to targets and strategy; these are matters that we would expect to be stated in the terms of reference. I shall write to my noble friend about the quick and dirty and the subterranean.

My Lords, I thank the Minister for that answer. I pick up the point made by the noble Lord, Lord Rea, about the excellence of research in this country. We do have some of the best research in the world in this country in this area. The underlying concern in my amendment was that we do not try to set up competing centres of research out of this commission when we already have world-leading research, and that the function of the commission should not be as a research centre. It should be advising the Government. Without the amendment, the Bill leaves it up to the Secretary of State to control that situation and to ensure that we hold on to our genuinely independent centres of research without a competitive element from the commission, rather than build it in to the Bill, as my amendment seeks to do. I do not think that we have a shortage of research or pilots, which are a very similar thing. However, we often have a shortage of determination to drive through the findings of research or pilots into full mainstream national programmes.

With those thoughts, and with thanks to the Minister for her reply, I beg leave to withdraw the amendment.

Amendment 24 withdrawn.

Amendment 25

Moved by

25: Schedule 1, page 18, line 31, at end insert—

“(2) All such remuneration, allowances and expenses must be published monthly on the internet.”

This is a very simple amendment. It is self-evident what it is trying to achieve. For better or for worse—and I do not expect the Minister to agree with me on this point—there has been a marked increase in the number of quangos, commissions, councils and committees under this Government. This has unavoidably led to questions of value for money, especially when it is clear to everyone that public spending must and will be cut. Of course, one would want a person of suitable qualifications to be employed in this role, but value for money must be maintained, and improving the transparency of quango funding is an important part of that.

There is a read-across to our last debate. If the commission is to carry out independent research, there are questions to be answered over whether its funding is to be spent primarily on commissioning new research or analysing what is already out there. A higher level of funding would be much more acceptable for the commission if it was seen to be undertaking new studies. I beg to move.

I thank the noble Lord. I understand his concerns about the establishment of a new advisory body and its associated costs. However, I cannot let the noble Lord get away with saying that these bodies have increased under this Government. I remind him that there has been a 6.7 per cent reduction in the number of non-departmental advisory public bodies since 1997.

Amendment 25 would provide for payments made to members of the commission to be published online each month. Expenditure on this new advisory body must represent real value for money. Here, I very much agree with the noble Lord, Lord Freud. Once established, the Child Poverty Commission will be a public body. As such, it will have to comply with all parliamentary rules on managing public money. This means that it must deliver value for money for the taxpayer at all times. In accordance with the Cabinet Office publication Public Bodies: A Guide for Departments, which is relevant to an advisory body of this nature, we will set out the total costs of the commission in an annual report to Parliament by the sponsoring department. This report will be laid in the Libraries of the Houses. It is also worth noting that members of the commission, or their employers, will be provided with no more recompense than is sufficient to ensure that their service does not leave them out of pocket. We are determined that this body will offer value for money. With those assurances, I invite the noble Lord to withdraw his amendment.

I thank the Minister for that response. However, the context in which we are discussing transparency has changed dramatically over the past six months, with all the media and public concern about payment for public office. Clearly, that concern has affected Members of both legislative Houses. To the extent that one can make any new bodies utterly transparent in the way that I am endeavouring to do, it can only be good for that body. It will come to be seen as a higher requirement generally in public service. I anticipate that this is a trend that we will see in the years to come as a direct result of what has happened with expenses over the past year. With those observations, I beg leave to withdraw the amendment.

Amendment 25 withdrawn.

Schedule 1 agreed.

Clause 8 : UK strategies

Amendment 26 not moved.

Amendment 27

Moved by

27: Clause 8, page 4, line 11, at end insert “, and

( ) for the purpose of ensuring as far as possible that households with children in the United Kingdom have the minimum incomes necessary to sustain a healthy diet, other necessities, safety and wellbeing for those children”

My Lords, we come to an important part of the Bill. As we know, in Clause 8, under the heading “UK strategies”, subsection (2) clarifies what the Government are to do in driving towards the 2010 and 2020 targets. Subsection (2) sets out a twin strategy. It looks at the duty to ensure that the targets are met, as we discussed earlier; it also, in paragraph (b) refers to the need to ensure,

“as far as possible that children in the United Kingdom do not experience socio-economic disadvantage”.

In that regard, Amendment 27 refers to “minimum incomes”. I note that there is another equally important and weighty amendment grouped with Amendment 27, so I hope we can spend a little time looking at what we should be doing to make these strategies as well focused and effective as possible.

I have been looking at this area for most of my parliamentary career, in another place and here. One thing that has always bedevilled everyone is the length of time that it takes for some of these statistics to come through. The Family Resources Survey and the General Household Survey are, by definition, complicated survey work. No one is complaining that the social scientists who do it are sitting on their hands; it just takes a lot of time to disinter the meaning from the figures and cross-tabulate the results. When we get to 2010, it will be another two years before we know whether the Government have made a mark. If we cannot speed these things up and do not have a real-time understanding of what is happening in low-income households throughout the UK, it is a matter of concern.

There is a well worked methodology for minimum income standards. In 1998, the Family Budget Unit produced a minimum income standard for families with young children called “Low Cost but Acceptable”. The Centre for Research in Social Policy in Loughborough and the Family Budget Unit in York have recently created a methodology that scientifically looks, in real time, at what low-income households need on a variety of indicators. It has to be an ongoing survey, but the Family Budget Unit has been able to get sponsors to do it only intermittently. When it is done, we know what standards must be met in order to keep people in a sustainable state of well-being over the longer term. It is an idea that is worth considering.

The Joseph Rowntree Foundation has, from time to time, sponsored some of this work. A July 2008 report A minimum income standard for Britain: what people think included a survey on public attitudes on a minimum income standard for Britain. It took ordinary people from the family types that it was studying. With expert support, they intensively discussed what they thought should be in a low-cost but acceptable budget and what should be left out. The survey found a remarkable degree of unanimity. For example, the group was quite easily able to define what a minimum income standard would look like, were it to be set up. The definition was:

“A minimum standard of living in Britain today includes, but is more than just, food, clothes and shelter. It is about having what you need in order to have the opportunities and choices necessary to participate in society”.

The group looked at what constituted an acceptable income for different family types.

I stress that we are looking at needs, not wants. There are any number of standards that would be wish lists. The report listed minimum requirements to sustain families with children, retired families and families without children. There were four basic categories: warmth and shelter; health and diet; social integration; and avoidance of stress. That work is important in indicating how far short we are of acceptable standards of living. In this July 2008 dataset—which is now out of date—pension credit couples who claimed their full means-tested benefits came up to a minimum but acceptable standard, which is a measure of success for which the Government deserve some credit, subject to the condition that the means-tested benefits have to be applied for, and we all know about the difficulty of getting people to claim their benefits.

There is a reasonably scientific method of answering the question, “How much is enough?”. We do not do that, which is a great shame. If we are going to have a meaningful strategy, this should be an important part of that work and that strategy.

There are different ways of applying the test of how much is enough. You can look at social indicators, attitude surveys and focus groups. The budget standards methodology that the family budget unit has worked out is a very useful tool at the very least.

Noble Lords may know that there is quite a wealth of international experience in countries such as Australia, North America, the Netherlands and Sweden. Minimum income standards have been a productive feature of their tax benefit debates for years. No one is suggesting that any of these states reach the position of being able to pay everyone a minimum acceptable standard benefit level, although some of the Scandinavian countries come close. The standards are a valuable tool and they are usefully deployed in debates in those countries. The European Union in 1992 recommended that sister European states in the then European Union should adopt this standard as a useful indicator in the course of their national policy-setting discussions.

Although to my knowledge this has never been done, the minimum income standards could help us to understand regional differences. I said earlier in the proceedings of the Committee that I am fearful that, no matter what we do, the problems in London are so severe that unless we solve them, we are not going to solve the larger problem. I am talking in terms of housing costs in particular, and other things as well, because households predisposed to low income are in a higher proportion in the London area. Regional figures, using this quite sophisticated technology and methodology, could help us to understand how we need to deploy some of the policies regionally differently. You would expect someone like me from Scotland to say that the west coast and Glasgow have a different set of circumstances from those you find in terms of poverty on the east coast and in the capital city of Edinburgh. Again, drilling into these actual budget levels at a regional dimension throughout the United Kingdom would make the application of the policy more effective. I hope that there might be different ways in different regions to deal with different parts of the problem as they are seen in different regions.

Mentioning Glasgow reminds me that nutritional standards on the west coast of Scotland are terrible, compared to anywhere. I am a Glaswegian and I had 18 years of it, and I am only just starting to recover now. We need to pay close attention to nutritional experts, who are some very clever people who do some expert work, for example in London university. Some of the minimum acceptable costs can be cleverly and accurately pinned down, so there is no excuse for saying that we do not really know what we need to do. We know exactly what we need to do in terms of nutritional standards for young people, particularly children at a formative age. I am conscious of the excellent work that the Zacchaeus trust and others have done to try to point that out.

I have two further points. First, the minimum income standards have something else that commend them uniquely; they are sustainable. If you can get families near to a modest but acceptable level of living in terms of the budget standards that they need for food and clothing and so on, and, indeed, in terms of the other half of it, the variable costs that make up a budget—insurance, rent and so on—you can be fairly safe in the knowledge that they are on a sustainable plane unless something dramatic happens. You cannot see that when looking only at the financial level of benefit because you do not know what is behind it—the levels of debt and all the other circumstances—and so it is important to have a sustainable, acceptable living standards measure.

If this is to be done, it has to be on an ongoing basis so that the trends can be mapped and people can see where they are heading in real time and in a useful way. If we are serious about a strategy between now and 2020, this is one of the most important things that the Government could do in order to convince me that they are serious not only about sorting out the problem in the fullness of time but about doing so on an ongoing basis. I beg to move.

My Lords, I have an amendment in the group and I hope to build on the arguments put forward by the noble Lord. I declare an interest having just agreed to become the patron of Foodbank Wales; I have done so because of the amount of food poverty in Wales.

The issue of minimum income standards was previously raised at the Committee stage in another place and it is clear even from the discussion so far that it requires further scrutiny. At that point in the Bill’s passage, the Government explained that they had ruled out minimum income standards because different research methods tend to make different assumptions and that it is difficult to get one answer to the simple and single question of how much income is enough. This response does not justify dodging such a crucial point: namely, how much it costs per week to live healthily in the UK. The Government merely made an obvious methodological point about the nature of research, but this does not dismiss the case for minimum income standards, nor dilute our obligation to answer fundamental questions when devising a child poverty strategy.

A recent study by the Rowntree Foundation indicated that while the minimum food standard is £43 per week, unemployment benefit for a single, childless woman under the age of 25 years is only £50.95. Admittedly after 25 years it rises by in the region of £7, but that leaves less than £8 remaining to purchase all the other necessities such as fuel, clothing and so on. In reality, this makes accessing a healthy diet low on the list of an individual’s priorities.

Throughout the Committee stage so far, the Committee has continuously returned to the crucial point that the strategy behind the Bill must address the causes of child poverty and not only its symptoms, and the Government have repeatedly acknowledged this as a priority. We have heard the term “cycle of poverty” many times, and yet we continue to shy away from the very axis that accelerates the problem—namely, the health of the mother and the child. The Bill categorises children as “materially deprived” if they cannot perform a range of basic activities such as school trips and celebrations on special occasions. How much more fundamental is the right of our children to a healthy diet? Is it not short-sighted to neglect calculating the costs of this?

In the time available, I could not do justice to the crucial importance of nutrition during pregnancy and infancy in tackling disadvantage. The noble Lord, Lord Freud, touched on the importance of maternal nutrition, and I should like to elaborate a little further. In brief, it is becoming apparent that low birth weights, of which Britain has the highest rate in western Europe, are associated with poor cognitive abilities and serious brain disorders such as cerebral palsy.

I remind the Committee that I come from south Wales, where we have the tragedy of the highest epidemic of spina bifida and anencephaly through folate deficiency. That was due to diet. Since folate supplements have come in, we have seen that drop dramatically. If you do not get diet right in pregnancy, you store up problems that will be there for the whole of the child’s life, from the moment it is born.

In 2002, Sir Derek Wanless’s report to the Department of Health, Securing Good Health for the Whole Population, expounded an egalitarian sentiment, harmonious with the sprit of Every Child Matters. He identified birth weight as a pivotal cause of a vicious cycle of poor health; he recognised that the cycle repeats itself from generation to generation and traps communities in poverty and health inequality. The cycle of poverty will remain repetitive and relentless unless we have the courage to tackle its very core and root that out. That is what the amendment seeks to do.

By identifying the amount necessary to ensure pregnant women and children have sufficient money to eat properly, my amendment aims to tackle the origins of this crisis in a serious and effective way. A recent article in the Guardian highlighted the issues of debt for many young pregnant women and, against that backdrop, their inability to afford to eat properly. The Minister in another place reminded us that a health and pregnancy grant is available to women from the 25th week of pregnancy, but that is far too late. From the time of conception and in those early phases of cell division, long before you might say that the foetus is medically viable, is when the nutritional influences probably have their major effect. We have to get this dealt with pre-conception, let alone from birth.

I anticipate that I shall be reminded that my amendment makes theoretical sense, but we cannot monitor the ways in which pregnant women will spend their money. Admittedly, there is a paucity of empirical data to guide our judgment, but I point the Committee to one study, conducted in Gary, Indiana in the USA between 1970 and 1974, which was published in the Journal of Human Resources and supports this strategy. I also emphasise the importance of educating women, which means girls at school onwards, about the value of a nutritious diet and what it contains. Unless we do that, the policy will not be able to be enhanced.

I am proud that the NHS is more than just a faculty. It symbolises Britain’s social democratic conscience and recognises that good health is instrumental to each individual’s chance of prosperity and success. If we had a modern-day Beveridge report in front of us now, child poverty would sadly be one of the five giants. Consequently, having boldly pledged to end child poverty by 2020, we cannot be pusillanimous in our efforts. I have no doubt that addressing the crucial question of what it actually costs for mothers and their children to access a healthy diet among other necessities is pivotal to delivering the promise.

What I have to say is very complementary to what the noble Baroness has just said, and may be slightly repetitive. However, it gives me an opportunity to cover further that vital stage in child development—the earliest stage, with the foetus in utero. Healthy babies, as the noble Baroness said, are produced by healthy mothers, particularly adequately nourished mothers. Many studies have shown that the most critical phase of development—the foetal environment at the very beginning of pregnancy—is the time when damaging effects can occur and is the most vulnerable time for the child. It is the time when the heart and cardiovascular system and the central nervous system are formed from the primitive streak, before the foetus is recognisable as a future human being. This occurs in the first few weeks of gestation, often before the mother realises that she is pregnant. That is why it is so important to ensure that not only mothers and women who know they are pregnant but also potential mothers—that is, all women of child-bearing age—have sufficient income to buy an adequate diet.

The human foetus is quite an effective parasite. It will take most of the things that it wants from its mother’s tissues but if the cupboard is bare, the foetus will be wanting. The noble Baroness pointed out, in particular, the effects of anencephaly and spina bifida resulting from folate deficiency. If that can occur, then other vital nutrient deficiencies are also likely to have serious effects. I should like to point out the possible effect of a lack of long-chained polyunsaturated fatty acids, found most richly in fish, on the subsequent IQ of babies. The ALSPAC study of 14,000 babies from pregnancy through to their early teenage years—I think that that is their current age, although I am not sure exactly how old they are—showed that those aged eight whose mothers had consumed very little fish during pregnancy had significantly lower IQs than those whose mothers had eaten quite a lot of fish. Of course, many social factors were involved but a lot of care was taken to allow for any bias based on things such as social class, education, smoking and so on. The study needs to be repeated but it is important and it points to the fact that we have to be very careful that, regarding the very young foetus, those nutrients are easily available to prospective mothers.

That is why it is so important for women to have an adequate budget to buy the diet that they need. What this diet should contain and what it costs has, as other noble Lords have said, been the subject of very careful research by the Family Budget Unit at York, as well as by the Nutrition and Public Health Research Unit at the London School of Hygiene and Tropical Medicine, together with a number of other units.

As the noble Baroness, Lady Finlay, said, the York team calculated that the minimum cost in 2008 for a healthy diet was £43.73 a week for a single person living alone. Of course, both noble Lords who have spoken so far have pointed out how very difficult it is for a person living on present levels of benefit to meet those costs when there are so many other demands on their meagre resources, even to survive, let alone to lead a life as a useful member of society. As the noble Lord, Lord Kirkwood, said, the cost of housing produces a particularly heavy burden in London. Although there is housing benefit, it is often not adequate and plenty of other costs are not covered. Therefore, inevitably less is spent on food, which means that the diet contains fewer of the vital nutrients which are particularly important in early pregnancy. That is why it is so important to ensure that benefit levels and the minimum wage are based on realistic, carefully researched estimates of need and not on arbitrary or uprated historical levels.

My Lords, I have a lot of sympathy with the amendments but also, I am afraid, some reservations and hesitations. The first amendment, in the name of the noble Lord, Lord Kirkwood, focuses not just on diet—particularly, that of pregnant women—but on the wider range of adequate living standards. Looking again at households below average income on pages 68 and 69, where the full range of indicators of material deprivation are listed, I wonder why he feels that the Government have not adequately included that through material deprivation to reach the issue of sufficient budgetary standards.

One could argue about sufficient generosity, but it seems that that test shows whether there is sufficient income to meet those standards of material deprivation which would suggest that someone is below adequate budgetary level. I wonder why he thinks that the HBAI stats and approach are not suitable for his concerns; while I obviously share those, I do not see why they are not good enough, although they could perhaps do with fine tuning over time. That is my first point; why do we not already have his considerations embedded in the Bill by virtue of material deprivation, which in turn piggy-backs on the HBAI 20 indicators?

My second point is on pregnant women. I absolutely take on board the very well informed and expert views of the noble Baroness, Lady Finlay, and my noble friend Lord Rea, so this is just a suggestion, as most benefit levels for pregnant women do not kick in until very late in pregnancy. The key thing that this Government were able to introduce—and all congratulations to my noble friend on it—was the Sure Start maternity grant, which is worth £500 over and beyond other benefits. The reason that it was done through Sure Start was to ensure that younger, single and potential lone parents had the enticement, if you like, of coming into maternity care in order to get their benefit.

As I understand it, however—and I was just checking on this—we do not normally pay it until 11 weeks before an expected confinement. Is there any reason why my noble friend and, through him, the officials behind him, should not look at whether they could break that up into two payments of £250? One payment could come early enough, at the first signs of a confirmed pregnancy, so that there is a space of capital—that £250 or so would be in a box, over there—available for the more expensive items in a diet. Folic acid is very cheap, but other items could include fruit and vegetables, meat with iron and appropriate fish. We could do that at virtually no cost; so could my noble friend take that away? Could we make the Sure Start maternity grant more suitably match the dietary needs of pregnant young women, before 11 weeks before their confinement?

My third question is, again, general. It is about budgetary standards and, again, goes back to the noble Lord, Lord Kirkwood. Rereading Mike Brewer’s IFS report, what comes out very clearly is that over half of all children in long-term poverty never suffer hardship and that, overall, only about 3 to 4 per cent of children in long-term poverty suffer actual material deprivation or hardship at the same time. In other words, very simply, where two people have the same income and one is in hardship while one is not, that shows that that may be through debt, addiction or for a whole series of reasons.

Whatever; all of those may come into play, but what it shows is that looking at income levels, even based on dietary standards, will not necessarily address the problem. It seems to me that it is actually a more profound problem about education and attitudes to well-being, and prioritising budget spending. It is very clear, affording to the IFS study, that on those existing lines of benefit levels and income over half of all children below the poverty line, or 60 per cent—and this is persistent poverty, not temporary or one-year but three-year poverty—are nonetheless not in severe hardship or suffering material deprivation. Therefore, that suggests that you have to go below those figures to ask, “What is going on here?”. That may well be about education and spending, but it does not mean that by increasing the income—although I would obviously be happy to see that—we are necessarily addressing the problem as the noble Lord would hope.

The noble Baroness has put her finger on a tremendously important point: increasing income will solve the problem in certain cases, but not in others. Can the noble Lord, Lord Kirkwood, indicate what his recommendations would cost the Exchequer as against the recommendations being made in the Bill? The noble Baroness, Lady Finlay, placed emphasis on pregnant women and the nutrition of children in utero. Not being a specialist on the subject, I can only say that I support the principle behind it.

I do not know whether we have any scientists here; I think that they are probably mostly social scientists. Should we not seriously look also at the nutrient value of food? Scientific technology now can do amazing things; for instance, a breeding programme is aiming to achieve—and, I believe, is achieving—much higher protein values in maize, which is important in nutrition in many third world countries. It sounds frivolous, but if we could make potato chips nutritious, we would have it made—we would not need any more money.

My Lords, I have considerable sympathy with both amendments. It would be a matter of dismay to support, as we do, a Bill to eradicate poverty, albeit on a necessarily new-speak definition of “eradicate”, and then learn that such eradication would still leave children with an unhealthy diet, unsafe and lacking other necessities such as warmth or clothes.

At the heart of the two amendments is the question whether the 60 per cent median is the best measure of poverty. We debated this matter last Tuesday and the Minister assured us that there is,

“a wealth of evidence that poverty measured by the 60 per cent threshold is strongly related to poor outcomes”.—[Official Report, 19/1/10; col. GC161.]

That is a fairly weak response to the issue.

The Liberal Democrat team did not show much interest in the amendment in question, perhaps because I raised it. However, Amendment 127 may show why they were aiming to keep their powder dry. Its proposers seem to be dubious about whether the 60 per cent median will do the trick and to be calling for what is effectively a minimum income standard based on what it costs to live in this country. The noble Lord, Lord Kirkwood, put particular emphasis on what it might cost to live in Glasgow.

I should like to take the opportunity presented by the amendment to explore the relationship between three sets of figures: the 60 per cent median figure; minimum income standards; and benefit and tax credit transfers. I revert first to the Rowntree study which the noble Lord, Lord Kirkwood, raised, A minimum income standard for Britain in 2009. I managed to find a slightly updated version; it is one year on from the version that he cited. The study found that the minimum income standard in that year for a couple with two children—I shall use that as the benchmark—was £438 per week before housing costs. The cost after those costs is £361, but I shall use the first figure. The income transfer payments are considerably below that. The figure for 2007-08 comes out at £306 before housing costs, and £218 after housing costs, for the same family. The HBAI study suggests that the same couple would need to receive a net disposable income, in 2007-08, of £361 before housing costs to be on or above the 60 per cent median figure, which is our definition here of escaping poverty. Just for reference, the figure is £323 after housing costs.

I am conscious that I have been unable to assemble exactly the same years in these three bits of data for the comparable figures. That is because I do not have a team of such excellent civil servants sitting behind me as does the Minister. I think that that he has five—and another three is it?—so eight brilliant civil servants. I have done my best without them, but I am sure that they will be able to get the precise figures. But the direction of those figures, even though I have not got exactly the same year for the Rowntree 2009 figure, is clear enough. The income transfers are currently well below the 60 per cent median figure, which in turn is well below the minimum income standard that people like Rowntree in York come up with.

My question is a very simple one. Can the Minister let us know whether the Government feel that the 60 per cent median figure gives families enough to live on?

I found the Rowntree study, A minimum income standard for Britain in 2009, an extremely interesting document. The noble Lord, Lord Freud, has just mentioned it. One thing that it said was that a full-time earner on the minimum wage cannot achieve the minimum income standard, which it calculated as £13,900 per single person—although, for the purposes of this Bill, we are more concerned about families with children.

The researchers said that for a couple with two children it is reckoned to be £27,600. I was interested in what they counted as the minimum income standard, and found that it was rather democratic; they asked the public what they thought and came up with a figure. I did not realise that research could be quite so democratic. They said that even though benefits went up last year by 5 to 6 per cent, the amount needed to achieve a minimum standard of living also rose by about 5 per cent after rent, so the adequacy of benefits relative to the standard did not improve. They made the point that someone on the minimum income spends a greater than average portion of their budget on food, domestic fuel and public transport, for which prices have risen by 7 to 12 per cent. They talked about the poverty line of 60 per cent median income, which is the figure in the Bill. That may be a rough and ready benchmark, but it was considered to be quite a suitable one. They went on to say that the cost of living was going up faster for someone around the minimum income standard than for the average family, so the only way in which people on benefits would improve their position was if median real incomes fell.

We know that the Government’s position for some time has been that benefits should be only a short-term shelter for people before they get a job. If they are given any more money, they will be more reluctant to get a job—that is part of the Government’s reasoning. Even if they are on employment and support allowance or incapacity benefit, unless they are very ill or disabled, they will be expected to do something in return for benefits. But that misses the point that there will always be more than 1 million children living in households which are wholly dependent on benefit, because their parents are long-term unemployed or temporarily unemployed or perhaps become disabled or go to prison—or because of domestic violence.

Here are some rather depressing figures. Children whose parents claim JSA have a 70 per cent risk of living in poverty. If their parents are on income support, it is a 54 per cent risk; and if their parents claim working tax credit, it is a 29 per cent risk. We do not say that benefits must immediately be raised to the minimum income standard, but there should be some estimation of what it is. The Secretary of State should consider what it is when setting out the measures to be taken under the UK strategy. It is worth pointing out that benefits in this country are not particularly generous, contrary to popular belief. I come back to my noble friend’s question at the beginning: if other countries, such as Norway, Sweden, Germany and Canada, know how much money is enough to live on, why do we not?

My Lords, I was not anticipating speaking but I will speak briefly in support of these amendments, particularly from the perspective of the Marmot national commission on inequalities in health, the report of which will be published on 11 February. I was a member of that commission. I was particularly struck by the comment of the noble Baroness, Lady Hollis, that children in families on benefits, living below the 60 per cent level, are not necessarily in severe hardship. That may be so, but the Marmot commission will certainly provide a considerable body of evidence to show that those children living and being brought up in poverty will have their lives blighted throughout, in health, employment prospects and many other areas. Certainly, if they continue in poverty they can expect some 17 years of additional disability in later life. I simply ask the Minister and the opposition spokespeople to take a good look at the Marmot commission report on or after 11 February. I think it should inform future policy on these issues.

My Lords, this has been a wide-ranging and fascinating debate. I thank the mover of the amendment and all noble Lords who have spoken. The Child Poverty Bill makes clear our robust commitment to eradicating child poverty. It is clear, as set out in Clause 8(5), which covers the strategy, that financial support is an important building block in an effective child poverty strategy. We will consider all potential methods of achieving our child poverty targets when we develop our strategies, including assessing the role of support for those who cannot work. However, I have some disagreement with the thrust of these amendments. We are committed to ensuring that the tax and benefits system provides adequate financial support. Over the last 10 years, we have invested heavily in supporting families. Families in the poorest fifth of the population are £5,000 per year better off as a result of personal tax and benefit changes since 1997.

There are several considerations that we must take into account when considering Amendment 67. We have recognised in this debate that the causes of poverty are multiple and complex, and that eradicating child poverty will require a comprehensive strategy to tackle each of these. Amendment 27 could, however, unbalance the strategy by requiring excessive weight on treating the symptoms of poverty and, to quote the noble Lord, Lord Freud, an excessive focus on one lever of tackling poverty—that is, guaranteeing that a household with children has a minimum income that would be sufficient to lift children out of poverty. Placing this obligation in the Bill would reduce the flexibility that the Bill provides for forthcoming strategies. It would force a focus on a particular approach to tackling child poverty that might not be as effective as other options.

More importantly, it does not present a sustainable approach. Several noble Lords focused on the importance of the strategy being sustainable. We know that escaping poverty through work has wider beneficial impacts on families, compared to escaping through financial support alone.

Entering work has many social benefits. It may reduce stress in the family and provides role models for children. Supporting families into work is also the most sustainable approach to tackling poverty. However, Amendment 27, by placing more emphasis on minimum incomes than on labour market incentives, could reduce the financial incentives to enter employment. The Government need to have the flexibility to balance these objectives.

We also have to recognise that many aspects of the benefits system are designed to provide short-term support in response to changing circumstances, such as short-term unemployment, rather than long-term sources of income. Requiring the Government to include measures in their strategy that create a minimum income does not take account of this purpose of the benefit system and could have a perverse impact on its effectiveness.

A requirement to prepare a child poverty strategy containing measures guaranteeing that out-of-work benefits lift families out of poverty could result in a resource-intensive and unsustainable approach to tackling child poverty. It would require substantial spending to achieve and could, potentially, entrench the intergenerational cycles of worklessness that are one of the underlying causes of child poverty. It runs directly counter to our objective of having a sustainable approach to tackling poverty.

Finally, there are also technical difficulties with adhering to minimum income standards in guaranteeing a minimum household income. With the survey techniques we use to assess household income, it is not feasible to ensure that no household falls below a certain income level. This is why our child poverty targets have been set at levels of 5 per cent or 10 per cent rather than at zero.

Amendment 67 would have a similar effect, by creating pressure to increase out-of-work benefits based solely on the impact on minimum income guarantees without taking into account the distorting impact on incentives to work and an undue reliance on unemployment benefit. Moreover, by setting the national minimum wage too high, Amendment 67 also risks damaging employment prospects. It proposes that the Secretary of State should have regard to minimum income standards in setting out-of-work benefits and the national minimum wage, and that he should consider research into the minimum cost of living.

The level of unemployment benefit and the national minimum wage are set at levels designed to accommodate competing demands. For example, the national minimum wage rate is subject to a comprehensive annual review by the independent Low Pay Commission, which takes into account a wide range of evidence when recommending the rates.  Its aim when setting the rate is to help the low paid, while making sure that employment prospects are not damaged by setting it too high. By placing undue weight on a single factor, this amendment could undermine the independence of the Low Pay Commission, which is key to ensuring support for the policy by wide sectors of society.

The Government welcome the research that has already been carried out on minimum income standards. We have heard about that today, particularly the work completed by the Joseph Rowntree Foundation. We continue to follow this research with interest. However, we do not agree that this approach should be enshrined in law in the way proposed. Indeed, the researchers do not believe that minimum income standards should be used as poverty thresholds. The noble Lord, Lord Kirkwood, effectively acknowledged that when he moved his amendment. Instead, we believe that the Government should have the flexibility to balance these objectives, as we currently do, against other objectives around labour market incentives, burdens on business and, ultimately, the impact upon individuals and the UK economy.

The Government have consulted extensively on the long-term measure of child poverty. Minimum income standards were ruled out because different research methods tend to make different assumptions, and it is difficult to get one answer to the question “How much income is enough?”. Even if it were possible to define income adequacy on a fully consistent basis, it would be difficult to generate a long-term, robust time series, which is essential for measuring progress. It would therefore be inappropriate to give such explicit consideration to minimum income standards when considering rates of unemployment benefit and the national minimum wage.

Taken together, the four income targets in Clauses 2 to 5 define a stretching goal. Achieving them will not only mean the lowest poverty rates since records began, and which will be in line with the best in Europe, but will tackle material deprivation and mean that the same families are not persistently poor. Although temporary periods of low income, such as that caused by a short spell of unemployment, can create difficulties, the most damaging effects of poverty are caused by long-term and recurrent spells of relative low income. The approach set out in the Bill, using a combination of four targets, is therefore a crucial part of ensuring that poverty does not affect children’s life chances over the long term.

A number of additional points were raised. The noble Lord, Lord Kirkwood, talked about the time that it takes for data to come through, and I think that we acknowledged that point. One way in which the Bill helps is through the local needs assessment, by which it is possible not only to deal with the regional differences to which the noble Lord referred but to understand in near time what is happening on the ground. We have to live with the time that it takes for the surveys to wend their way through, because integrity and the robustness of those surveys are very important.

A number of noble Lords, including the noble Baroness, Lady Finlay, and the noble Lord, Lord Freud, referred to a benefit raise. The rates quoted were correct but they would typically not include additional benefits such as passported benefits, free school meals and exemption from NHS charges. They do not include housing benefit, council tax benefit or mortgage interest support, for example. It was suggested that housing benefit levels in London were insufficient to cover housing costs. The structure of the reformed housing benefit, the local housing allowance, was intended to ensure that in any particular area housing benefit would bring half the potential properties within the scope of people who wished to rent. However, a review of housing benefit is under way, and we wait with interest to see where it goes.

The noble Lord, Lord Kirkwood, raised the question of how much was enough for a family to live on. The reality is that different families have different needs and wants and will spend their income in different ways. Taken together, the four targets outlined in the Bill will provide a good indication of whether progress is being made on the various facets of poverty, such as persistence of poverty and material deprivation.

My noble friend Lady Hollis, as ever, made some telling points—in particular, on the disparity in the numbers of people on relatively low incomes who are not in material deprivation. We had an interesting debate, which I do not think we should open up again, on the informal economy and the other issues that perhaps drive some of the reasons for that.

The noble Lord, Lord Kirkwood, touched on the complexity of the benefit system. He knows well, as we have debated it endlessly, that the Government have an aspiration to simplify the benefits system. We know, as we take steps along the way to do that, that inevitably it will be challenging. There are often significant costs involved, but we shall continue to strive to do that. Again, it was the noble Lord who made reference to international comparisons. I agree with him in the sense that issues around minimum income standards should be part of the debate. The Government are not saying that we would not give consideration to those, and I think that he called them a valuable tool. However, as he acknowledged, no country exclusively uses minimum income standards when setting benefit levels, although come countries consider them—in particular, the Nordic countries.

The noble Baroness, Lady Finlay, raised the issue of research into minimum income standards. We have not ruled out such research; we expect to take it into account in developing the child poverty strategy as part of a range of research and evidence that we will draw on. Indeed, we are doing that at the moment. It is not as though we are closing our minds to it.

The noble Lord, Lord Rea, raised issues concerning a healthy diet, particularly for pregnant women, young children and babies. His expertise in that area makes that a pertinent point.

My noble friend Lady Hollis referred to the lump sum available to low-income families to help with the cost of a new baby and asked whether it could be paid in two parts. We shall certainly consider that but part of the problem is that, in order to access it, one needs to have gone through an assessment and engagement with a health professional around the general welfare and health needs of the new baby. It is unclear whether the noble Lord’s approach would be consistent with that.

The noble Baroness, Lady Meacher, referred to reports on inequalities of health. Again, I acknowledge her expertise in this area. Health is a key building block in the strategy. Inequalities of health can sustain poverty and disadvantage.

My noble friend Lady Hollis said that the material deprivation component of our targets is already in the Bill and asked why that is not doing the job. The noble Lord, Lord Freud, asked whether the 60 per cent median threshold is enough and whether benefits are set appropriately. There is no direct link between benefit rates and the level of income needed to be lifted from poverty. Most benefits are uprated annually to ensure that the level keeps pace with inflation, and the uprating method varies by benefit type, but in general most contributory, non-contributory and extra-cost benefits are uprated by RPI. What people need to live on varies greatly and depends on their needs and a range of factors. Different research methods make different assumptions and generate a range of estimates, which is why we need the four targets in the Bill and not just one, and why we need to focus on the causes of poverty as well as the achievement of those targets.

That is probably an inadequate response to a wide-ranging and knowledgeable debate, but I hope that I have been able to set out the Government’s position on these matters and that noble Lords will not press their amendments.

I shall respond briefly because my Amendment 67 may not be called for a little while. I have an ongoing concern that we have not addressed head-on the problem of poor diet. If women have an inadequate diet in pregnancy and the foetus is deprived, and children have a poor diet, those children are blighted for life. Due to that, I shall certainly return to the matter on Report.

I accept fully the Government’s criticism of some aspects of the wording of the amendment but, if we are talking about setting targets against child poverty, I do not see how as a nation we can afford to ignore the importance of adequate nutrition and its impact. We have an enormous problem with childhood obesity in this country. We know the disadvantage at which it puts children and we know that it is linked to inadequate diet. Many children are obese and malnourished. This is at the heart of the issues—

I should stress that we support the necessity to consider diet and healthy eating. Health is a key strand of the building blocks that the Secretary of State is required to consider when developing the strategy, as is education, childcare, social services, housing and the built and natural environment. It is part of the approach to the strategy but is not directly reflected in one of the four targets that we are measuring, which are based on income. However, the strategy will not succeed if we do not address health inequalities.

I support the noble Baroness, Lady Finlay, and wish to make a point which goes to the heart of her concern. As I understand the point she was making, nutrition is what matters most early in a pregnancy. One of the most interesting things about the way in which the tax credits and benefits system has been going is that, because of its emphasis on child poverty, there is now developing—I shall try to draw this out in a later amendment—quite a distortion of the way in which the poor are supported.

If you are a lone parent with one child, according to the House of Commons Library, you are now running at only 4 per cent from the minimum poverty line. If you are a single woman—a potential mother or a pregnant individual—your income distance is now 22 per cent. What the noble Baroness is saying, as I understand it—I have great sympathy because we have been trying to make this point all the way through the debate on the causes of poverty—is that poverty and an inadequate diet around the period of conception or shortly afterwards have a causative effect on poor outcomes later. It could be argued that the way in which we are distorting our benefits system for the poor to help child poverty has a direct impact on such poor outcomes.

My Lords, I am grateful to noble Lords who have taken part in the debate; it has been an important and significant period in the course of the Committee’s work. I have been particularly struck by the powerful medical evidence given by the noble Lord, Lord Rea, and the noble Baroness, Lady Finlay, and I am grateful to them. I shall go away and reflect on what they have said. If there are other reports in the pipeline in early February, we might have the advantage of seeing them before the Committee finishes its work on the Bill. They might even describe, for example, the benefits of adding folic acid to bread. We could perhaps even make chips with folic acid, but I am not sure about Coca-Cola. However, these are serious points and I shall go away and reflect on the powerful evidence we have heard in that direction.

On the points made by the noble Baroness, Lady Hollis, the HBAI proxies for standards of living are too patchy. It is clear from the deprivation indices that people cannot afford many of the things on them, although they do not say by how much they are short. However, I should say to the noble Baroness that it might be possible to expand some of the HBAI proxies and I shall go away and think about that. They are not adequate at the moment—we may disagree about that—but she has a gem of an idea that I am willing to explore. There is room to trade and I am willing to think again about the issue. At the moment, the HBAI proxies do not cover the full gamut of a family unit budget.

Do the Government feel confident that the 60 per cent median poverty figure is enough to live on? It clearly is not enough for people who are in persistent poverty for three out of four years. I am not saying for a nanosecond that we should adopt minimum income standards as targets for benefit payments; I am simply saying that if the figures had been available to us today, we would be in a much better position to make an informed judgment about what needs to be done. I agree that I have not really worked this out in that it is not costed—people should not hold that against me or I will sue them—but if you could show that a typical family with a 10 year-old and a four year-old child were a long way below the minimum income standard for three out of four years, then I would look to the interesting ideas put forward by the noble Lord, Lord Freud, as a proxy for targeting. Such people need remedial help. If they are a long way below minimum income standards for three out of four years and have a 10 year-old and a four year-old, they are in trouble.

The spend-to-save philosophy that the noble Lord, Lord Freud, has valuably given the nation enables you to be confident in saying to people who ask, “Why does this family get help and not that one?”, that you are using resources in a way that is understandable and explainable. That is another club in your golfing bag, or whatever the figure of speech is, and not having it leaves us flying blind in a way that I do not think is useful.

I just remind the noble Lord that, as well as low income and material deprivation targets, there is a persistent poverty target in the Bill, although we had a debate about whether that should be persistent material deprivation. I am not sure that we agreed to differ but we did differ on that. However, this is not just a question of the 60 per cent target. In fact, for low income and material deprivation, the equivalised net income is based on 70 per cent of median equivalised income.

I had spotted that earlier. However, that is two or three years out of date and, for a lot of other reasons, I think that minimum income standards are a much better tool with which to make more accurate policy decisions. I thank the Minister for his response and I shall of course withdraw these amendments and reflect on what has been said. It was very disappointing in that he said that this is all too difficult because of work disincentives. If the Minister does not think that money has to be deployed between now and 2020 in some way, then he will never get to his targets. I understand the argument that, if you set benefit levels too high, people stay at home. I do not think that anyone is arguing for that, but he seemed to hide behind it and say, “This is all a waste of time because it flies in the face of established policy”. That is what he seemed to be saying.

I am conscious that it is not helpful to get into a dialogue on this. I very much recognise that income is a crucial part of tackling poverty, and income transfers are a part of creating a decent benefit system. I have cited some of the progress that we have made as a Government since 1997 but there is a balance there concerning work incentives. We have endlessly debated the benefits of work in terms of aiding health and self-esteem and breaking into the generational cycle of poverty in households. We need to make progress on that, but tackling health inequalities is not necessarily an income issue for families—it might, in part, be an educational issue—so we need to use more of these levers to make progress.

I acknowledge that, but we are talking about earning, and if minimum income standards were available today and if there were a government figure, that would demonstrate clearly that the minimum wage was not enough to reach the 60 per cent. That is a worry as well in terms of where the Government and their policy are going.

This has been a good debate and I undertake to go away and think about this matter. The Government must start making it clear that the strategies will be fully supported by all the measurement methodologies available. I for one will certainly be disappointed if the commission that we are setting up does not look at minimum income standards urgently, with a view to informing some of this policy. I have not given up hope that we will somehow be able to get this insinuated somewhere into the Bill. I am grateful to colleagues and this has been a useful debate. The Committee will, I hope, return to it at a later stage. I am grateful to the Minister and beg leave to withdraw the amendment.

Amendment 27 withdrawn.

Amendment 28

Moved by

28: Clause 8, page 4, line 11, at end insert “, and

( ) to ensure that the UK appears in the upper half of any table of OECD (Organisation for Economic Co-operation and Development) countries published by UNICEF measuring child well-being”

My Lords, the intention of this amendment is to explore the relationship between child poverty and child well-being. It is interesting to see how many experts tell us that child well-being as a whole is a more important measure than child poverty. Child poverty is an odd concept because we cannot measure it directly. Children do not, on the whole, have income or wealth, so we measure a proxy in the shape of those households which contain children. It is likely that a proportion of any extra resources put into those households will not go into improving child well-being. Either it will be diverted or cash adjustments may simply not be very effective in improving well-being. At the risk of irritating the Minister, I remind him that, in its formal targets at least, the Bill is not exactly a child poverty Bill; it is a relative household income Bill. The question that this amendment poses is: if we are interested in our children, should we concentrate harder on their well-being? This is important because the set of targets selected here will drive particular interventions. However, the Child Poverty Action Group, in its recent document Coping with Complexity, tells us that,

“if the aim is to achieve the greatest improvement in wellbeing overall, improving the home and neighbourhood environment is likely to be more effective than reducing material deprivation”.

I was concerned to read Professor Jonathan Bradshaw’s paper on child poverty and well-being, which points out that,

“the child poverty rate explains only about 30 per cent of the variation in overall well-being”.

I quote his conclusion at length because it is very interesting:

“The relative child poverty rate which has been adopted by the EU as the only child related primary or secondary indicator of social inclusion is not adequate to represent variations in child well-being across the EU25. The proportion of children in jobless households is worse. Educational attainment, which might be adopted, is even worse. There are some single indicators that are highly correlated with child well-being and for which there is data across the EU25. However it might be better for the EU to adopt the kind of multi-dimensional index of child well-being of the kind explored”—

in the paper he is writing. He concludes that what those indices show is:

“The results are disappointing for a UK audience. Despite the efforts that are now being made to abolish child poverty and through Every Child Matters improve the well-being of children, the UK finds itself resolutely at the wrong end of the international league table. This may of course be lag effect—much of the well-being data is old and when more recent data become available we may be moving up the league table”.

Professor Bradshaw concludes ominously:

“There is a long way to go”.

He states:

“Given the wealth of the UK, our children are doing badly”,

and that the UK,

“again is notable for not getting the child well-being that its spending deserves”.

I shall not dwell for too long on the embarrassment of the relative position of the UK in the UNICEF table of 21 rich countries in 2007. We were 18th in terms of material well-being—only Ireland, Hungary and Poland were worse; 13th in health and safety—that is the only half-way respectable performance; 18th in education; bottom in family and peer relations; bottom in behaviours and risk; and 20th in subjective well-being, which is bottom because the US was unscored in that category. At Second Reading, the Minister said that much of these data are old. I feel guilty saying that that is a classic Civil Service-type answer given the fantastic civil servants in this Room—I think there are still eight of them—so I shall say that it is a civil-servants-not-in-this-Room-type answer, and I am sure the Minister felt uneasy delivering it.

It would be more worrying if we were to achieve the child poverty target and then find that we still have the lowest child well-being in the rich world. That is the problem with targets. If they are proxies, you do not always get what you want.

Does the noble Lord not agree that that is not the right question to ask? Having got the transfer of income to address the child poverty issue, the question is what we must do at the same time to ensure child well-being. These are not either/ors, but the noble Lord keeps trying to suggest that they are.

If one were to ask most voters whether they would prefer to hit the child poverty target or to be number one in child well-being in the rich world, I think the majority would choose the latter. People would like to see us leading on child well-being and would see child poverty as secondary to that. This amendment is designed to make sure that we focus on what I say we really want, which is child well-being. I beg to move.

I agree with the noble Lord, Lord Freud, that this country should be aiming at the well-being of every child. We want every child to be healthy and happy and to fulfil his or her potential in life. However, the noble Lord has too much ambition for the Bill. Child welfare is achieved by a raft of different strategies to address different aspects of their well-being, and it is very complex. The Bill has ambitious, but fairly narrow, targets. Our job in this Committee and, later, on the Floor of the House, is to make the Bill, within its objectives, as good as we can. What the noble Lord suggests is a distraction. I do not disagree with it in principle. As an only just ex-trustee of UNICEF, I am very concerned, despite all the criticism of the report to which the noble Lord referred, that the UK found itself at the bottom of that list. I am sure we would all like to see our children right at the top.

We need to look at this Bill and what it is trying to achieve as just one of many strategies. We might well cite the importance of getting rid of the violence in our society, which affects so many of our children, their behaviour, stress and their brain development—all things that I have spoken about many times in the House. We might well look at children’s education and other aspects, some of which can be achieved by improving their income, but not all. In this Committee, we must focus on the meat of the Bill.

My Lords, I support the comments made by the noble Baroness, Lady Walmsley. We have said this before. I have written various books, for my sins. What infuriates me most when they are being reviewed is when the reviewer says, “I wish you had written a different book”. I say, “Sod that! That wasn’t the book I was seeking to write”. In a sense, that is part of the debate today. No one challenges what the noble Lord is saying. No one denies that these things can add to the misery of children. So can the mental ill health and violence of parents, and so can a whole series of issues, which have to be addressed and may be addressed in parallel. That is not to say that the Bill should not remain focused, otherwise we will not address these targets; they will get lost sight of in a wider approach to well-being.

I have another reason to hesitate. I am not particularly accusing the noble Lord of bad faith, but I worry when I read some of the reports coming from the Centre for Social Justice. By fixing on some of these factors and others like them, it seems to suggest that the lack of moral fibre in parents is the driving force of the poverty of the children who then experience deprivation. Therefore, it is not our job to transfer money; it is our job to moralise the parents into behaving in the ways that we would like to see, which conveniently gets us off the hook of redistributing money, because it is the parents’ own fault. I am not suggesting that the noble Lord is advancing that argument today, but I have seen it run in columns of newspapers time and again, when research such as this tries to suggest that it is in some sense due to the fecklessness, lack of moral fibre, unwillingness to work, poor relationships and failure to marry—this, that and the other—of the parents, and that that dowry to their children gives them poverty. I do not doubt that those are contributory factors in many ways, but to say that they are the causes of poverty and that income is merely the symptom can, if you are not careful, lead you down the slippery slope of saying that it is the parents’ own fault and that if only they bucked up and received a proper, decent moral education and if only we could fix all that, we would not have to address children’s poverty, because it would get sorted out in the wash.

My Lords, leaving aside the politics that has been going on about this issue, both noble Baronesses have put their fingers on a tremendously important point, and one that I made very early in the Bill. There is only one problem with this Bill—that it calls itself the Child Poverty Bill. The implication is that the Bill is the Government’s major tool in reducing child poverty. If they were somehow to introduce a form of words that made it clear that this is, in fact, a very good and important Bill on a particular subset of the problem of reducing child poverty and increasing child well-being, we would all have to shut up—and we could probably get through Committee stage a great deal more quickly. In the next few amendments, we are all trying to get things into the Bill that we feel should be in a child poverty Bill.

I agree with the noble Baronesses, Lady Walmsley and Lady Hollis. I wonder whether the noble Lord, Lord Freud, has read the report issued two years ago by the Children’s Commissioners of all four nations. I found it very interesting. Sometimes one would think that all children are desperately unhappy, not able to get out of bed and committing crimes all over the place. That report, which was very balanced, gave the views of children. It talked about what they found wrong with living in their particular countries, but also what was right. The issue of what was right is very significant because they felt that a considerable amount was. From that, one would not have thought that we were at the bottom of every league table. I am a trustee of UNICEF and welcome its reports, but from listening to children, one would not think that we are as desperate as we seem to be in that report.

My Lords, I thank the noble Lord, Lord Freud, for tabling this amendment, which has given us the chance for an interesting debate. Indeed, this is the first of a series of amendments that seek to specify additional areas that noble Lords believe should be covered or taken into account in developing the UK’s child poverty strategy. There was a significant debate in the other place on the nature of that strategy as required by Clause 8, particularly on whether the breadth of the areas to be considered in developing the strategy, as listed at subsection (5), is sufficient. Those issues are at the heart of this amendment and subsequent amendments. With that in mind, I shall take this opportunity to explain a little further the thinking behind the clause before I address this amendment.

Building on analysis of the evidence of the drivers of poverty, our approach is to set out the broad aspirations to be followed in preparing a child poverty strategy for 2020. The aims are that while families are in work that pays, they have the support they need to progress; that financial support is responsive to family situations; that poverty in childhood does not translate into poor experiences and outcomes; and that children’s environments support them to thrive. Together, these aspirations will achieve the 2020 vision that no child will grow up in poverty and deprivation by 2020 or beyond.

A child poverty strategy, as required by Clause 8, will need to consider measures in a number of policy areas that match those aspirations and encompass the main drivers of child poverty. Improving parental skills and employment and financial support for families with children will ensure that families have the resources that they need to lift their household income above the poverty line. Promoting children’s outcomes in health, education, childcare and social services, while improving the quality of housing and local area facilities and services and promoting social inclusion will help to break intergenerational cycles of poverty.

The policy areas set out in Clause 8 closely match the building blocks set out in the consultation document Ending Child Poverty: Making It Happen. Those policy areas were chosen through detailed analysis of the main barriers to eradicating child poverty, and through extended discussion and consultation with stakeholders inside and outside government. Some of those areas directly impact on the resources of families now; others impact on the development of today’s children, who will be the parents of tomorrow. We have deliberately set out the main areas of policy in broad terms in subsection (5) to allow the strategy to respond to changing circumstances between now and 2020. Part of the task in developing the strategy will be to consider what specific measures are needed in each area. We are carrying out a thorough review of the evidence base to help us understand the causal pathways and identify how different sets of policies can contribute to the 2020 target. That will ensure that the strategy tackles the root causes as well as the symptoms of child poverty, preventing poverty occurring now and in future.

The Bill deliberately avoids being too prescriptive about the content of the strategy. Clause 8 specifies a number of broad areas, encompassing the main drivers of child poverty, which we would expect a child poverty strategy to address. It does not specify detailed policies that the strategy must contain; such specificity would not be appropriate, as each three-year strategy will need to respond to changing circumstances between now and 2020 and build on evidence about what works in tackling child poverty. It is envisaged that more specific measures will be considered, as appropriate, in each three-year phase.

Amendment 28 includes in the Bill consideration of the UK’s performance on the UNICEF child well-being measure compared with other OECD countries. The amendment targets the UK’s ranking in future UNICEF reports on child well-being. The UK’s performance in the 2007 report has been raised previously by a number of noble Lords and was raised again today by the noble Lord, Lord Freud. As I made clear, the report highlighted some significant challenges for children’s well-being in the UK. However, much of the data in the report were old and did not provide an accurate picture of what it was like to grow up in the UK in 2007.

Let me explain why Amendment 28 is not appropriate. First, introducing targeting and index-ranking in the way the amendment seeks to do would create perverse incentives to focus on improving the UK’s score rather than on addressing important practical issues in improving child well-being. Secondly, there continue to be problems with the data that UNICEF uses—namely the health and behaviour of schoolchildren data from 2001-02. This source collects data from England, Wales and Scotland only and omits Northern Ireland, so it cannot be used to construct a complete picture of child well-being in the UK. The UNICEF child well-being measurement index aggregates across six dimensions of well-being to provide an overall country score.

A report published by the OECD in September 2009 also conducted an international comparison across different dimensions of child well-being but did not aggregate countries’ scores into a single index. The OECD report cautions against the creation of an overarching index given that there is little theory to guide how aggregation should take place, and also because it masks varied performance across dimensions for different countries. There are also differences in data availability across countries and any league table or ranking cannot fully account for them. Given different data availability across countries, there is a risk in all international comparisons that countries that have relatively better data collection in place are penalised because of their ranking. Given this, I hope that the noble Lord will agree that the amendment does not propose an appropriate focus for the child poverty strategy, which is what the noble Baroness, Lady Walmsley, and my noble friend Lady Hollis said in their powerful contributions.

The noble Lord, Lord Freud, referred to the fact that the UK is at the bottom of the child well-being index in the UNICEF report. Certainly part of the data on which the report was based relates to 2005-06. He referred to voters being asked whether they would prefer to be top of a well-being table or to be top of an income target that had been met. The two are not mutually exclusive and to pose it in that way, as my noble friend Lady Hollis said, is to create a misconception. We had a disagreement the other day about whether this is all leading to the saying that the income targets are not important and that you would not adhere to them. I accept that the noble Lord said that he signs up to the targets in the Bill in the same way that we do, and that is to be welcomed. Whatever definitions we use, it is absolutely clear that unless a household has a decent income, persistent and grinding poverty will pervade. That is why it is important that we stay focused.

The noble Lord, Lord Northbourne, again questioned the description of the Bill. However, described as it is, it creates the focus that we want. My noble friend Lady Massey referred to the four nations report. I have not perused it, but I am encouraged to do so by her comments. Having said that, I urge the noble Lord to withdraw his amendment.

I thank the Minister for his response and all noble Lords for their contributions to the amendment. The Minister made a point about persistent and grinding poverty.

We want to help children brought up in persistent and grinding poverty. As noble Lords know, I am looking forward to our discussions because we want the Bill to capture children in persistent and grinding poverty. The noble Lord, Lord Kirkwood, said that when we can find those children, the way that we help them may be radically different from the blanket approaches that one could see with large numbers. When we can isolate the children who are really suffering, we can get effective strategies to help those families.

We should worry about this a lot because, in the end, the well-being of the children is probably more important. I was surprised to read Bradshaw’s conclusion about the discrepancy between the poverty rate and the well-being rate. He said that the poverty rate explains only 38 per cent of the variation in well-being. My concern is that it is perfectly possible to achieve the targets we have, yet not shift the well-being figure very much. That is why I raise this issue.

As the noble Baroness, Lady Walmsley, said, it may be too ambitious—

I look forward to reading Hansard tomorrow. It is ambitious, but is it the right ambition? Is it a more important ambition than child poverty? The noble Baroness, Lady Walmsley, said that it is not appropriate in the Bill. Where else can we try to achieve child well-being if not in a Bill directed at trying to help children? I am not aware that we have a set of targets to try to get really good child well-being in this country consolidated in any other place.

I thank the noble Baroness, Lady Massey, for her reference to the report by the Children's Commissioners of the four nations, which I have not read, to my shame. I shall now do so and look forward to enjoying it.

I come to the point raised by the noble Baroness, Lady Hollis, and I subtract her reference to turf. The arguments laid out by the Centre for Social Justice are not about moral fibre or moral judgment. The line of argument is simple. For instance, the Child Poverty Action Group says that separation is the most important single cause of poverty—not correlation, but cause. All the experts in this Room are familiar with the figures that show that after a separation—

I know the statistics about what happens to women and to men, but it is also the case that a lone parent in work is no more or less poor than anyone else. In that situation, it is worklessness, not the status, nature and structure of the family that creates the poverty.

From memory, I think the figures showed that a lone female parent’s income declines by 28 per cent, whereas men’s income goes up by 4 per cent. I can be corrected on these figures.

That is absolutely right. We know that divorce impacts on men and women very differently. However, in dealing with families on benefit, the female lone parent will often be on benefit, while the man will be in work. When she gets into work, her situation is not particularly different from that of the man.

I am grateful to the noble Baroness, Lady Hollis. I will go through the Centre for Social Justice’s argument. In a year, only 30,000 children under five are affected by the separation of married couples, while 90,000 children are affected by the separation of cohabiting couples. This is despite the fact that—again, speaking from memory—only 16 per cent of couples with children cohabit; the rest are married. The vast majority of this problem derives from the breaking up of cohabiting parents. That is where the problem is.

It is not a matter of morals or moral fibre to look at the situation and say that it is very dangerous. The Centre for Social Justice goes on to provide analysis in its Dynamic Benefits report and the Green Paper that it put out last week. It has assessed the average material couple penalty to be £1,336 per year.

A few amendments back the noble Lord was arguing exactly—and correctly—the opposite. That is, in the equivalence scales, couples are overestimated compared to single people, including lone parents, because the scales use an 8:6 ratio for the first and second person in a couple, whereas the OECD uses 100 per cent and 50 per cent. The noble Lord rightly said that the OECD figures were probably more accurate. In other words, far from there being a couple penalty in the benefit system, the noble Lord himself was arguing the opposite: couples were overweighted in the benefit system, based on his information and research on the equivalence scales.

I was not arguing that. There is a difference between the absolute figures and the equivalence figures. I am just quoting a well researched figure from the Centre for Social Justice, which finds that the difference between being apart and being together is £1,336 if you are a low-income family, with all the discouragement that that has for family formation and families staying together. You can—and some people do—argue that the financial effects have no impact on behaviour. I find that suspicious. Usually financial effects on that scale—we are talking about a reasonable scale—will influence behaviour, particularly when there is this very high level of break-up in cohabiting families with low incomes.

I know that we will come back to this, so I will not prolong it much. In the figures that the noble Lord has quoted, what account was taken of the costs of two people who previously lived together now living apart? What was the impact of there being two lots of costs that those newly formed households had to meet?

I thank the Minister for the question. I do not have that figure. I almost have to respond as he would: I shall write to him when I have found out what the exact figure is.

Is the noble Lord arguing that couples should get more than they do currently, or is he saying that the couple rate is correct and that the lone parent rate is too high? It is not the case that the financial penalty breaks up a couple because they decide that they are better off living apart but none the less have an intimate relationship. First, it is not worth, say, a lone parent with a couple of children by another father having a boyfriend living in the house if, as a result, her benefit goes down, particularly if the boyfriend is unemployed. Again I say, with reference to the noble Lord, Lord Northbourne, thank goodness for that, because the key perpetrator of much family domestic abuse and violence is the live-in, quasi-stepfather who is not the biological father of the children.

The noble Lord has to disentangle the issues far more than he is doing. If, when a couple break up, they simply get half the couple’s rate, then, as my noble friend Lord McKenzie says, that is not enough to form two separate households. If the noble Lord is going to allow them enough to form two separate households, there will be a significant cost implication, and he has to look at that. However, in practice things happen the other way round: it is not that couples break up because of the financial problem; it is that couples who have a sexual relationship none the less do not cohabit in a household because of the benefit penalty, and that has some real pluses in terms of child protection. Better a lone parent than a stepfather.

I thank the noble Baroness, Lady Hollis, for that, but I am slightly taken aback. Last time she accused me of social engineering, and she is now saying that I am assisting in the prevention of stepfathers by having a couple penalty. That slightly surprises me. The figures that I quoted earlier showed that the lone parent with one child is now only 4 per cent below the poverty level. As the best relative performer of all the people dependent on benefits, the lone parent is better off remaining separate than moving in with someone who may be the biological father. It is often a question of couple formation as much as couple break-up, but that is just not a tradition in some parts of our community.

The important argument being made here is made not on moral grounds but on genuine grounds. We have a system that discourages couple formation among lower-income groups and there is a very high level of break-up. Accordingly, many children under the age of five in that group are being thrown—at least, initially—into poverty. That is the well-being issue at the heart of this matter. I know that there is a difference between us here but some would argue, as would researchers, that there is a causative effect and not just a correlation. The Minister has been arguing that there is a correlation but others, including the Centre for Social Justice, believe there is a causative relationship.

I wanted to have a debate on this amendment because the well-being issue is vital. I shall go back to it and think very hard about how to encourage—

Amendment 28 withdrawn.

My Lords, it has been suggested that this would be a convenient moment to break for natural reasons. We normally do so for 15 minutes but we now have a Division as well. I am in the hands of the Committee, but I suggest that we make it a 25-minute break.

Sitting suspended for a Division in the House.

Amendment 29

Moved by

29: Clause 8, page 4, line 11, at end insert—

“( ) For the purposes of this Part, the definition of “socio-economic disadvantage” is not limited to financial considerations and must include, in particular, consideration of whether the family has experienced—

(a) family breakdown,(b) alcohol or drug addiction,(c) a lack of education and skills, or(d) persistent unemployment.”

The Minister has on several occasions stressed the importance of socio-economic disadvantage when saying that the specific targets that we propose to tackle the causes of poverty are not needed, because the strategy contains a protection so that children do not experience socio-economic disadvantage. “Socio-economic disadvantage” is a nice-sounding expression, but I am genuinely puzzled as to what it could mean in a legislative context. When could a child say that he or she suffered or did not suffer socio-economic disadvantage? The guardian of the term would seem to be the Office for National Statistics and it has changed significantly—

Sitting suspended for a Division in the House.

My Lords, I shall quickly go through what I started with, on the basis that the listener absorbs half of what is said and remembers half of that—and that is doing well. The issue is socio-economic disadvantage, which is a nice-sounding expression, but I am genuinely puzzled as to what it means in a legislative context. Following on from that, when can a child say that he suffered or did not suffer socio-economic disadvantage? The guardian of the term socio-economic is, as best as I can tell, the Office for National Statistics. The definition has changed significantly over the years; in the last century—by which I mean the 20th century—we had two versions of “socio-economic”. One was based on social class and occupations and the other on socio-economic groups.

Early this century we changed to a new socio-economic classification, and this definition is, I presume, the legal basis on which this part of the clause rests. I am not sure that it does quite what is intended. The website for the Office for National Statistics states:

“The NS-SEC aims to differentiate positions within labour markets and production units in terms of their typical ‘employment relations’. Among employees, there are quite diverse employment relations and conditions, they occupy different labour market and work situations. Labour market situations equate to source of income, economic security and prospects of economic advancement”.

It goes on to specify the subtlety of work relationships but then concludes:

“Not everything can be explained by what a classification directly measures, employment is not the only determinant of life chances”.

So the formal classifications here would not seem to be very helpful in the context in which we are talking.

Is the Minister taking us back to the last century with this definition? In other words, does the phrase mean only “economic and social disadvantage”? This would appear to be equally difficult to apply in practice. Given the slowing rate of social mobility, it would appear that being born, for instance, to parents who were in the lower classifications, however defined, would make it difficult for children to move to higher levels. Surely this cannot be what is meant. I seek to probe the Minister as to exactly what the term means in a legislative and judicial context.

It is in this context that I seek to put some flesh on the bones. On some of my previous amendments, noble Lords have commented that I have been trying to put ornaments on a Christmas tree. My response to that is that if a clause is completely vague it serves a purpose to give it some definition. I have once again selected the four main factors, based on the research, which lead to poor outcomes for children. As the amendment states, these are: family breakdown, addiction, a lack of education and skills and persistent unemployment. I do not intend to go through them again as I laid out the rationale for them last week, albeit in the context of their use as formal targets rather than in the strategies clause.

However, I shall revert to the issue of addiction. This category is different in kind to virtually all the others. Nearly all the categories of deprivation look at helping the whole household which contains children. This approach breaks down in the case of addiction. Here there is a divide between the interests of the children and what the parents are driven to spend funds on. It is absolutely no good to try to help children of addicted parents solely through financial transfers. As my noble friend Lord De Mauley said at Second Reading, this strategy would delight only the local drug dealer and off-licence outlet. There must be other strategies to help the children of addicts.

Again this is not a marginal issue. According to the Centre for Social Justice, there are some 1.5 million children of addicts, and this number is likely to overlap considerably with the number of children who are classified as being in poverty. The poverty target for next year, as we all know, is 1.7 million children. I know that we are set to miss it but, nevertheless, it could well be that the vast majority of children left in poverty in the difficult decade we are entering are the children of people who are driven to divert resource away from supporting them.

When the Minister responds I should like to learn two things from him. First, what is the formal meaning of “socio-economic” in this context? Secondly, what strategies will the Government adopt to help the children of the addicted? I beg to move.

My Lords, I thank the noble Lord, Lord Freud, for his amendments, which seek, first, to focus the definition of socio-economic disadvantage on those non-income policy areas that he argued are the key drivers of poverty—namely, family breakdown, alcohol and drugs addiction, lack of education and skills, and persistent unemployment. The amendments seek, secondly, to broaden the focus of the strategy specifically to consider family breakdown and alcohol and drugs addiction. Along the way, the noble Lord pressed on the Government’s view of the definition of “socio-economic disadvantage” for the purpose of the Bill.

Amendment 29 tries to particularise the definition of socio-economic disadvantage so that it is not limited to financial considerations and must include a consideration of family breakdown, alcohol and drug addiction, a lack of education and skills, and persistent unemployment. I reassure the noble Lord that we agree that socio-economic disadvantage should not be limited to financial considerations. Indeed, the duty in the Bill was included partly to balance the strategy so that it would not focus exclusively on income measures to meet the four largely income-related targets. However, particularising the definition to the extent that it is effectively limited to those four policy areas is not the right approach.

There is no precise definition in the Bill of socio-economic disadvantage. However, we consider that it relates to a child’s access to material and social resources, and their ability to participate in society. A person who is affected by socio-economic disadvantage will be in an unfavourable economic and/or social position relative to someone else. Over the long term, lack of access to stimulating and enriching experiences and opportunities may adversely affect children’s development and well-being. As they grow up, this is likely to impact on their outcomes in key areas such as education, health, employment and income. The strategy includes provision to ensure that all children are covered by it, not only those in private households.

I am afraid that I remain far from convinced that family breakdown and addiction are at the heart of tackling child poverty and that socio-economic disadvantage should refer explicitly to them. The noble Lord has made many assertions during our deliberations so far about the accuracy of the data underpinning the targets in the Bill, yet he needs to examine with his expert eye the statistics. Is he really contending that measuring family breakdown and addiction would be a more rigorous basis of evaluation than the ONS-approved HBAI data that we use for the targets?

Research has shown that children are at increased risk of adverse outcomes following family breakdown and that negative outcomes can persist into adulthood. However, the difference between children from intact and non-intact families is small and the majority of them will not be adversely affected in the long term. Some children can benefit when it brings to an end a harmful family situation; for example, where there are high levels of parental conflict, including violence.

As we have just touched on—and perhaps should not labour—we take the view that lone parenthood has only a small effect on poverty and child outcomes according to the best available evidence, although I am aware from our recent discussions that the noble Lord takes a different view. Meanwhile, we agree that actions to improve education, skills and employment are important. In preparation for the first child poverty strategy required under the Bill, we are producing a strategic direction paper that reviews the evidence base to help us understand causal pathways and identify how different sets of policies can contribute to the 2020 target. In doing so, we are considering a wide range of relevant data and statistics, including information around workless households and parental skill levels.

I put it to noble Lords that it is not necessary to define “socio-economic disadvantage” in relation to these areas. Instead, it is better to follow our approach of naming policy areas in Clause 8(5) that must be considered in the UK strategy. I see no merit in the amendment and therefore urge the noble Lord to withdraw it.

Turning to Amendment 35, Clause 8(5) requires the strategy to consider what measures, if any, ought to be taken across a range of key policy areas. These are referred to as the “building blocks”. They have been determined through analysis of evidence that shows that they have the potential to make the biggest impact in tackling the causes and consequences of growing up in socio-economic disadvantage.

On a point of clarification, when the Minister referred to Amendment 35, did he mean Amendment 34? I have grouped Amendments 29 and 34 together.

Yes, I apologise. I meant Amendment 34.

The Bill requires strategies to set out the specific actions that need to be taken across this full range of areas to meet the targets and ensure that children do not experience socio-economic disadvantage. Amendment 34 is another attempt to place family breakdown and alcohol and drug addiction at the heart of the Bill, this time in the building blocks. We have just debated why we do not consider that appropriate. I do not wish to imply that the issues raised by the noble Lord are not important, but the evidence does not show that family breakdown and addiction are the key drivers of poverty. Therefore I do not accept that they should be added to the building blocks.

The noble Lord asked what the Government would do to tackle drug and alcohol addiction and their impact on children. We know that parents’ drug and alcohol use can cause harm to children at all stages of development. The most effective way to keep children safe is to engage parents in treatment and work with them to strengthen the family. The Government are investing almost £80 million in 2009-10 to support families at risk through the Think Family programme. We have given parents with drug problems priority access to treatment and have supported a network of family self-help groups to develop across the country.

The drug strategy, which was introduced in February 2008, sets out actions to take a long-term view of prevention by intervening early with families at risk, improving treatment for parents with drug problems and protecting their children. It will improve drugs education and strengthen the role of schools and children’s services in identifying problems and intervening earlier; integrate substance misuse issues within mainstream children’s services and targeted youth support; improve access to positive activities and ensure effective specialist treatment for under-18s. There is considerable additional information to explain what the Government are doing to tackle drug and alcohol addiction and its impact, particularly on children.

We have been through the key issues that this amendment raises. I hope that the noble Lord is satisfied with the explanation.

Before the Minister finishes and I respond, my question is: what does “socio-economic disadvantage” mean? If I am a child—which once I was—how do I sue the Secretary of State for not worrying about my socio-economic disadvantage? What do I say? What has he not done? What am I suing for? It is meant to be a law, but if it does not mean anything why have it? If it means something, what does it mean?

My Lords, we should be clear that the Bill does not create any individual rights for children. That is not the purpose and thrust of the Bill. As I hoped I had explained, we have not specifically defined socio-economic disadvantage, but the Bill seeks to address those issues where a child’s access to material and social resources, and their ability to participate in society, are impaired.

I am sorry to come back to this and I thank the noble Lord for giving way again. Under the Bill, the Secretary of State has to set up a strategy to ensure that targets are set, and he has to ensure that children do not experience socio-economic disadvantage. Presumably the group of children suffering socio-economic disadvantage can, as a group, take the Government to judicial review based on the fact that they have been left in social disadvantage. That is how I read the provision. If that is not the case, I do not understand what the Bill is doing; if it is the case, I do not understand exactly how we are going to define in legal terms what is meant by socio-economic disadvantage.

My Lords, I reiterate that the Bill does not create any rights for children individually to pursue a Secretary of State if they consider that they are left in socio-economic disadvantage. The noble Lord missed a part of Clause 8(2)(b), which says,

“for the purpose of ensuring as far as possible that children in the United Kingdom do not experience socio-economic disadvantage”.

I am sure that the noble Lord understands the thrust of that. It seeks to ensure that all children get the same opportunities, that they are not income-deprived, that they have the opportunity, through education, to gain skills and knowledge, to enjoy life and to engage with others. I suppose we could write an essay on that. I do not think it is very helpful to try to pin down a very narrow legal definition. However, that is what the noble Lord is doing with his amendments, and that is why we object to them.

I apologise for interrupting the noble Lord. I heard what he said but I want to ask a question about what he did not say. Would the quality of family life be an element in socio-economic disadvantage?

It seems to me that it could be. We want children to grow up in stable family households, but that does not necessarily mean households where there are two partners or two partners who are married. We want them to have a stable life where they can flourish. It is one of those terms which is easier to identify when it is not present rather than when it is.

I thank the Minister for that response but I have to confess that it leaves me more puzzled than when I initially raised the amendment. This is a clause in UK law that will put a duty on a Secretary of State—I think we agree on that—but the Minister has not been able to provide me with any definition of what that means in a real sense. It may be the case that an individual child cannot take the Secretary of State to law but certainly a group such as Save the Children or the Child Poverty Action Group should be able to take the Government to judicial review under the clause. Having listened to the Minister’s answer, I do not understand on what grounds such a group would be able to take the Government to judicial review. He emphasised the words “as far as possible” in the clause and I am left feeling—I shall give way for extra clarification—that Clause 8(2)(b) does not mean anything at all in legal terms.

The noble Lord has asked some very pertinent questions of the Minister but perhaps I may ask one of him. Does he feel that proposed new paragraphs (c) and (d) in his amendment, which refer to,

“a lack of education and skills”,


“persistent unemployment”,

are completely separate from financial considerations? It seems to me that they are intimately bound together, although paragraphs (a) and (b) in the amendment may not be. Some of the things that we have seen lately from him and his right honourable friend David Cameron suggest that somehow economic and financial considerations are completely separate from a lack of education and skills or persistent unemployment, although it seems to me that they are intimately bound together. He has asked some very pertinent questions of the Minister; perhaps he could explain to us whether he regards those items as totally separate from the financial considerations that we are talking about.

I thank the noble Lord for his intervention. I am concerned that some noble Lords may be irritated if I answer at great length because we have already gone through this issue. However, I shall answer the point briefly.

We accept the financial measures but are concerned that they should be balanced by clauses which tackle the causes of poverty, and we have brought forward our interpretation of what those clauses should be. As the Committee may be able to tell, I am baffled by some of the answers I have received on the word “socio-economic” and I am trying to put some definition around the part of the strategy which seeks to support children specifically. The conclusion I draw from the Minister’s explanation—and I do not think I am the only Member of the Committee to do so—is that the clause does not have any teeth. I am trying to give the clause some meaning by putting in specificity.

It is open for noble Lords to argue that this may not be the best way to make the clause specific, but I hope the Committee can see the direction of my argument. I do not think the word “socio-economic” as it stands in the clause does anything to help children.

The noble Lord needs to read the whole of Clause 8. Basically, it does what many other pieces of legislation do. It starts with a declaratory statement of intent—to overcome disadvantage and ensure that the targets are met—in subsection (2)(a) and (b); then it must refer to the other nations; then it must be laid before Parliament; and then it outlines the dimensions of that socio-economic disadvantage against which, if appropriate, measures should be taken. This is outlined in subsection (5)(a), (b), (c) and (d).

I do not understand the noble Lord’s problem. The clause sets out the territory that the UK commission will occupy in seeking to deliver subsection (2) and describes it in subsection (5).

I thank the noble Baroness for that. However, that has not been the debate indicated by the Minister’s response. He has said that the socio-economic disadvantage protection is an extra protection from the targets process.

It cannot be extra protection from the target process because that is in subsection (2)(b); the targets are in subsection (2)(a).

Thank you again. I am arguing that the Minister has placed a great deal of weight on the word “socio-economic”; I cannot see that it carries any weight in a legal context because it is an undefined word. I may have been misinformed and, if so, I would be willing to hear the legal definition of “socio-economic”. What does it mean here? That is the question.

My Lords, we have tried to explain what we believe it means and the purpose of the use of that term. We have explained that it is not specifically defined in the Bill. My noble friend has rightly said that you have to read the totality of the clause. Clause 8(2) is about the UK strategy and subsection (5) is about preparing that UK strategy. If the Secretary of State fails to prepare a reasonable strategy and, as a result, the targets are not met, one of the sanctions for failure to have an effective strategy is the risk of a judicial review complaint for not meeting the target. Alternatively, there may be grounds for a judicial review for failing to prepare strategies in compliance with Clause 8 or preparing unreasonable strategies as discussed below. I do not believe that it is right to say that use of the expression has no legal teeth. A further sanction, which applies to subsection (2)(a) and (b), is that the annual reports to Parliament must state whether the strategy has been implemented in full and, if not, the reasons why. There is therefore political and public accountability for not implementing the strategy. To say that it is a useless expression, which is the import of the noble Lord’s comments, is unreasonable.

I thank the Minister for that. I remain baffled about what Clause 8(2)(b) adds by adding an ill defined word to the process. The strategy in Clause 8 is to achieve precisely defined targets. Clause 8(2)(b) throws in that the Secretary of State must ensure that children,

“do not experience socio-economic disadvantage”.

In debates on earlier amendments, the Minister leant on that phrase. In particular, he said that it implies a responsibility for the Minister that is broader than just meeting the targets and that that is why it is there. That is why I am concerned. When we look at the clause closely, when it is undefined, we see that it does not add anything. If a Secretary of State were to say, “I don’t know what it means. I did my best, guv”, that would be a defence in law. If that is the case, if we are doing pinpoint—

That will not do, because the Secretary of State will have had advice from the commission, which will have had lots of information given to it. The Secretary of State could not just tear it up and say that he would not have any regard to it. That advice would cover not just the four individual targets but would address issues, one presumes, around socio-economic disadvantage. To write it off in the way the noble Lord has done is not appropriate. I accept his point that it is not as tightly and specifically defined as a clearly measurable target. However, there is a clear obligation on the Secretary of State to have a UK strategy that must do two things. In preparing that strategy, the Secretary of State must consider certain things. My noble friend had it right: the collection of requirements gives full value to the wording of the clause.

I thank the Minister. I do not want to go on and on. I understand the targets in subsection (5) perfectly, and I am perfectly happy with most of them, but I do not understand how one can use fuzzy language like this when it is meant to achieve something. This is just a question of proper drafting. I urge the Government to think very hard about drafting sentences that are so difficult to define, apply or use. I beg leave to withdraw the amendment.

Amendment 29 withdrawn.

Amendment 30

Moved by

30: Clause 8, page 4, line 21, at end insert “and the promotion of economic enterprise”

My Lords, I am moving Amendment 30 in order to give us the opportunity to highlight the importance of enterprise in empowering people to return to work and the role that the Government can play in encouraging and supporting those seeking to return to work. This recession has sent thousands into unemployment, putting children in those affected households at risk of being brought into poverty and deprivation as one or more of their parents is unable to find work. There is general agreement about work being at the heart of any permanent route out of poverty, which the Government’s IFS report noted. It said, quite categorically, that—

Could I not suggest to the noble Lord that his amendment is completely redundant, given that the concerns he wishes to express, which I am sure that we all share, are fully covered in Clause 8(5)(a)? Unless we are going into a Second Reading debate on the Government’s economic back-to-work policies and their strategies on unemployment across the nation as a whole, I do not see how the amendment will add anything to the Bill beyond what is already in that paragraph.

I thank the noble Baroness for her intervention. The importance of this is that work is the main route out of poverty; that is an agreed position of the Government and has been regularly stated by them. It is very easy to overlook the fact that meaningful work—or a very substantial proportion of it—comes from private enterprise.

Perhaps I might return to the IFS point that I wished to quote, that,

“the magnitude of the difference in living standards between workless families and families with at least one worker with similar incomes … is difficult to explain”.

The key point that I was making last week was on the difference between a pound earned and a pound transferred. I think it is rather easy to explain the difference. The self-respect that comes from supporting yourself, the independence of living on income other than government benefits, and the important social aspects of interacting with colleagues and the public are all benefits that employment gives to people in addition to their wage. Of course, any child living in a household feels those benefits too—the IFS report is very clear on that—so there is universal consensus that promoting and facilitating employment should be at the heart of any strategy to help children out of poverty.

Unfortunately, at the end of 13 years of a Labour Government, it is clear that Labour is rather better at talking about that than achieving it. Although we have finally seen a small fall in the headline unemployment rate—the first since May 2008—there are still millions out there seeking work, with 2.3 million people classed as economically inactive but not appearing in the official unemployment figures. The figures for children are just as bad. The new figures show that 2.14 million children, and one in five of the under-fives, are growing up in households dependent on out-of-work benefit. With long term unemployment still rising, now is certainly not the time to become complacent.

In an economic climate where jobs are very thin on the ground, enterprise and entrepreneurship are crucial. We need to get people off benefits as soon as possible, before their future earning prospects become permanently damaged. There is a valuable role for enterprise here. The IFS report was specifically commissioned,

“to explore the fact that self-employed families have, on average, higher living standards than would be suggested by their income”.

We all accept that where a family is surviving on a low income, it is better for all involved if that income comes not from the Government’s benefit offices but from work. It is now clear that it is even better if the wage earner is working for themselves.

The IFS report concludes:

“When comparing households with children with similar incomes, self-employed families with children have higher average living standards than employed families with children … who in turn have higher average living standards than workless families with children ... Both surveys suggest that those in self-employment are less likely than those in employment to experience hardship when experiencing poverty”.

What are the Government doing to help families lift themselves out of hardship? Labour policies supporting those wanting to set themselves up in self-employment are very thin on the ground. The New Deal self-employment option covers only 5,000 people a year, and the amount of support for business start-ups is only £400, which is hardly sufficient for a one-man operation and certainly not enough to set up a business that is capable of employing others. Would the Minister not agree that the Conservative work for yourself scheme, a network of business mentors, tied in with substantial loans, would add significant value to the excellent work undertaken by organisations such as the Prince’s Trust?

There is much more that I could say about the value to people, and therefore to their children, of getting back into work. The Minister has heard me say much of it previously in our debates last year on the Welfare Reform Act. I am glad that the promotion and facilitation of employment of parents is drafted into Clause 8, but I would like a specific role for enterprise to be added. I beg to move.

The answer to the noble Lord’s question why children in self-employed families with the same income apparently do better than families who are in employment, as shown by the IFS study, goes back to the under-declaration of income on which he commented earlier in Committee. There is therefore a real question mark over the legitimacy of some of their claims for in-work benefits.

My Lords, I can see some merit in the argument that the noble Lord has put. As someone who has served an apprenticeship, I know that when a person works long and hard in a factory where there are perhaps 300 or 400 workers and redundancy comes along, the one thing that they are not used to is self-employment. They could be tradesmen. By that, I do not mean to be chauvinistic: I mean tradeswomen as well. When I say journeymen, I mean journeywomen as well. When tradesmen and journeymen are faced with self-employment, they do not know how to go about it, because they have always had an employer who looks after the administration of their wages, their national insurance and tax deductions. When we try to help people in poverty and out of work, there is a case for saying, “Look, you’re an electrician. Why don’t you work for yourself?” or “You’re a plasterer. Why don’t you work for yourself”? But it takes training. People do not just go from working for an employer out into the street and just get on with being self-employed. There is more to it than that. The promotion of business, particularly in our poorer areas, will help substantially.

I stayed only two miles outside my previous constituency, so I travelled through it almost daily—in fact, I travelled through it coming here. There is a carwash system there. Often, when we talk about people living in areas of higher unemployment, we say, “Ah, they don’t want to work”, but that is not particularly true. The carwash system that I walked past is manually operated. We often have sub-zero temperatures. When you get snow down here, it becomes a big national issue; when we get snow up home, nobody talks about it. I see people there working in wet, soaking conditions all day and every day, and in low temperatures.

They gladly work hard, and my heart goes out to them. Many of them live in some of the areas where there is deprivation. There is no point in going into those housing estates and talking about socio-economic disadvantage; they will say things like, “We’ve not got any money”, or, “We’ve got bad housing”. They will say something like, “I’m skint”—which means they have got no money. They will not say, “I’m at a socio-economic disadvantage”. I have a wee difficulty with the language. It is all right for the academics reading this, but it is hard for the very people that we want to reach to understand. If you are trying to help people, you should use language that the recipients understand—and, looking at this Bill, I do not believe that we are doing that.

On enterprise, I dealt with a lot of asylum seekers. One came in from eastern Europe, and he was not allowed to work, because while you are claiming asylum you cannot have a work permit. Lo and behold, he went to an industrial estate and got a small unit, half the size of this Room, and set up a car valet scheme. He was earning quite a lot of money. I told him, “You’re not allowed to do that”. He came to me as the MP and said, “Tell the officials to leave me alone—I’m earning, I’m doing well here”. I said, “But you’re not allowed to do that”. The point is that he came from a part of Europe where it was part of the culture to become self-employed. It is not that people are lazy in some of the areas that we are trying to help, but self-employment is not in their tradition or their psyche.

In Glasgow, there used to be hawkers—I do not know whether they are called hawkers here in London. They were men and women who had wheelbarrows and who went round the doors and sold second-hand clothes; it was honest, hard work. Many of the sons and daughters of those hawkers, because they were self-employed, were not afraid to get into business on their own. But there are people who are afraid to do so. If you can get enterprise schemes and give training and give the skills, that is so important. We must give apprenticeships—we must even give adult apprenticeships. Many of the men and women who are unemployed are unemployed because when they left school no one was looking for an apprentice at that time. They went into unskilled work and became unskilled labourers. Therefore, when they were made redundant, they could not turn their hand to other things. If we had schemes by which we could give adult apprenticeships and give apprenticeships to young people leaving school, that would build up their confidence to such an extent that they would be prepared to get into self-employment.

I would not get into the argument about whether self-employed couples do better than couples who are employed. The name of the game is to earn a wage, so that the child can get the benefits that other children get. That is the important thing.

My Lords, this is a brief but interesting encounter around an amendment. We have no disagreement about the importance of work in helping people out of poverty on a sustainable basis. That has been the key focus of our employment policies for a decade or more. The noble Lord will be well aware of that; he used to be one of our advisers at one stage, so he knows full well the thrust of our effort. That applies not only to people’s economic well-being but, as Dame Carol Black’s report—Health, Work and Well-being—showed, it is good for people’s health to be in employment. Getting back into work can be part of their recovery; falling out of work can damage their health. We have no disagreement on that. I do not have the detailed figures in front of me but the noble Lord referred to some of the unemployment figures. If he compared the unemployment data now with where they were in the two previous recessions, which took place when his party was in government, he would see a dramatic difference. That is because the Government have been active in helping people into work and to sustain jobs.

I say to the noble Lord, Lord Martin, that, yes, we are committed to enterprise as well, whether it is direct employment, self-employment or partnership working. People have different appetites, skills and levels of risk that they want to undertake.

Turning specifically to the amendment, it would relate to additional areas that the noble Lord believes should be either covered or taken into account in the development of the UK child poverty strategy. As I have already pointed out, the list of policy areas or building blocks in Clause 8(5) was selected though detailed analysis of the main barriers to eradicating child poverty. We do not see any benefit in expanding the detail of that list. Again, I do not wish to dismiss the importance of promoting economic enterprise or to claim that it is unrelated to the goal of ending child poverty and ensuring that children do not live in socio-economic disadvantage.

Like my noble friend Lady Hollis, I was intrigued by the analysis that the noble Lord seemed to make about the self-employed and the employed who were seemingly on the same household incomes but with one being better off. The conclusion was that somehow there is some magic in being self-employed that, of itself, improves people’s material well-being. As my noble friend pointed out, this is as likely to be due to under-reporting of income as anything else.

Taking steps to promote economic enterprise, particularly among low-income families, will have a role to play in reducing levels of child poverty. It is vital that the child poverty strategy addresses the need for job creation. The flexibility associated with some self-employment could, for example, help lone parents back into work. We are already working to ensure that as many people as possible can get back to work in the economic downturn. To give just one example, the six-month self-employment offer was introduced nationally from 6 April 2009, focusing support on self-employed jobseekers who have been out of work for six months or more.

Clause 8(5)(a) already requires the Secretary of State to consider measures in relation to promoting and facilitating parental employment and skills. Moving into work or self-employment clearly reduces the risk of being in poverty. Again, I do not deny the importance of encouraging economic enterprise. I would argue that the Bill already refers to facilitating the employment and skills of parents. What this amendment seeks is already adequately covered by the Bill’s provisions. Given the hour and where we are, I will not spell out all the detail of the Government’s efforts to encourage and promote enterprise, but they are considerable. I hope the noble Lord will feel able to withdraw his amendment.

I thank the noble Lord for his response. I am also conscious of the time; we have had an enjoyable session. I will make one or two small points.

First, on the Minister’s point about the two previous recessions, the difference is very interesting. One of the biggest differences—I do not know how to quantify this in relative terms, but it is critical—is the flexibility that the private sector, in particular, has shown in the levels of part-time working. Interestingly, that flexibility was not supported or financed by the Government in this country but by Europe. That has been remarkable.

That is simply not true. First, it is certainly the case that the non-labour on-wage costs in Europe are much higher than in the UK; they run at about 40-odd per cent and in the UK they are about 26 per cent. Secondly, thanks to the Government’s introduction of working tax credits and tax credits, particularly for lone parents and disabled people at 16 hours work, there has been a positive inducement for part-time work which pays.

I am grateful for the intervention of the noble Baroness, Lady Hollis. However, that is not the point I seek to make; I apologise if I have not made it clear. The main areas where people have gone on to three or four-day weeks are in high-end jobs and the manufacturing sector, normally at a cost to the employee, although there has been some support from employers. The process in Europe, including in Belgium and Germany, is that the subsidies are provided by the Government. This Government have not supported that process and I congratulate them on that because it has saved a lot of money. That has happened more flexibly here than in any other European country and is a testament to a relatively flexible labour market.

There has been a substantial difference—I do not mean to go on and on about this—between this recession and past recessions. I do not know how to quantify the absolute effects of the process but it has been a substantial element. The worry is that we may be slower coming out of the recession as the economy reabsorbs all those part-time workers rather than taking on new ones, which is an interesting economic issue.

I am sorry, but I did not quite follow what the noble Lord was saying. He was congratulating someone—was it the Government?—on the fact that they were not helping the process of this, frankly, forced part-time working. What we have actually got is a great deal of hidden unemployment. This affects not only factory workers but, as the noble Lord will know from his experience in the City, includes city solicitors and so on. Through this hidden unemployment, many people are effectively being forced to take a pay cut and being forced into part-time working. Was the noble Lord congratulating the Government on not doing anything about that? I could not quite follow what he was saying.

I realise I have to be politically correct in these matters. I was congratulating the Government on not subsidising a process of adjustment but allowing the market and the contracts between employers and employees to hold sway, albeit the employees took a hit. In practice, what happened economically was that instead of having another half a million people unemployed and fully dependent on the state, the misery was spread in that way. So, yes, I was congratulating the flinty heart of the Government on this occasion. That is what I was trying to do but I do not know whether they appreciated being congratulated on this.

On the point about enterprise and self-employment, the Government have substantially downplayed self-employment as a solution for unemployment. I quoted a figure of 5,000 a year going down the self-employment route as compared with the figures for the end of the last recessions of nearly 100,000 a year. The noble Lord, Lord Martin, emphasised the point that, as a route out of unemployment, it is of great value. However, you need help. That is why I advertised our policy, which I knew the Committee would appreciate, of a mentoring process. You cannot expect people to do it on their own. That was why I wanted to push that particular aspect of supporting it.

I am very grateful to the Minister for his response, although I am disappointed that he has not just automatically accepted the amendment. I cannot understand why he does not do that more often. On that basis, I beg leave to withdraw the amendment.

Amendment 30 withdrawn.

Committee adjourned at 7.40 pm.