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Child Poverty Needs Assessment

1. Background

1.1 What is Poverty?

Child Poverty and poverty more generally is a wide-ranging issue involving social, economic and psychological aspects of a person's life. In the broadest possible terms it is the standard of living enjoyed by or level of wellbeing of a child. In short, not only the ability of a child to enjoy their rights but to thrive and reach their full potential on an equal footing to their peers. When children and families are deprived of the resources (monetary, material and emotional) to overcome barriers they can be said to be living in poverty.

Whilst a whole manner of resources are important to children and families to be able to live lives free of poverty, arguably of key importance are the monetary resources or the levels of income available to families. The current definition of child poverty, set out in the Child Poverty Act 2010, focuses on the levels of income available to families and sets four income-based UK-wide targets to be met by 2020:

  • Relative low income (whether the income of the poorest families are keeping pace with the growth of incomes in the economy as a whole) - target is less than 10%.
  • Absolute low income (whether the poorest families are seeing their income rise in real terms) - target is less than 5%.
  • Combined Low income and material deprivation (a wider measure of people's living standards according to access or ability to obtain 'necessities' as defined by society) - target is less than 5%.
  • Persistent Poverty (length of time in poverty/families falling in and out of poverty) - target to be set by regulations by 2015.

1.2 How Do We Measure Poverty?

Both the relative and absolute measures look at the numbers of children living in households where the income of that household is below average national income levels. The relative measure takes account of the current income levels in the country (constantly changing) and the absolute measure is taken against the 'minimum income levels' at a set date (currently updated to 2010/11 levels).

The national indicator (NI 116 - a relative measure) which is used to assess progress against reducing child poverty defines poverty as:

The percent of children who live in families in receipt of out-of-work benefits or in working families with income less than 60% of the median national income (taking account of differences in household size and composition)

In 2008/9, the average household income in the UK (The median income before housing costs and before tax) was £407 per week.

The 60% median line or the 'Poverty line' was at £244 per week. This means that if your weekly income is below this line then, according to this measure, you could be said to be living in poverty. We must remember, however, that this does not take into account the levels of expenditure of a household - you will need different amounts of money depending on where you live and the make up of your household.

Graph showing median income

DWP HBAI 2008/9 Link to External Website Adobe Acrobat Format

Whilst this measure does not take into account different housing costs across the country, it can take into account the levels of income needed by different households. For a couple with no children the average income is £407 per week and the poverty line is at £244 per week yet for a couple with two children aged 5 and 14 the average income is £623 per week and the poverty line is now raised to £374 per week. It is obvious that, generally, you need more money if you have children and, generally, you will have less income if you are a single parent:

Average (median) income (Per week)

Income needed to be over 60% of the median (poverty)

Before Housing Costs

Before Housing Costs

After Housing Costs
Couple with no children
Single with no children
Couple with two children aged 5 and 14
Single with two children aged 5 and 14

DWP HBAI 2008/9 Link to External Website Adobe Acrobat Format

The 2009 "minimum income standard for Britain Link to External Website" (MIS) research, which looks at the income required to reach a socially acceptable standard with respect to inflation and household costs concludes that a single person in Britain needs to have an income of at least £13,900 a year before tax in 2009, in order to afford a basic but acceptable standard of living. A couple with two children need to earn at least £27,600 (this assumes you are a tenant on a modest rent of £65 per week). (MIS Britain 2009 Link to External Website Adobe Acrobat Format)

For further information, you can also use a tool developed by the Institute of Fiscal Studies to look at how income and household characteristics affect income relative to the rest of the population (IFS "where do you fit in" Link to External Website). Finally, we must bear in mind when measuring incomes relative to the rest of the population that if the incomes of the highest earners in society are reduced this will show a reduction in the relative child poverty measure but will not present an increase in the incomes of those with lower incomes, something which can happen during an economic downturn.

1.3 Why Does Poverty Matter?

The consequences of allowing a child to grow up in poverty are severe, not only for the child but for the family, for society and for the wider economy. For a child, consequences can be wide ranging and can affect Health, Education, Employment, Behaviour, Finance, Relationships and wellbeing.

A child growing up in poverty has a greater likelihood of experiencing health problems from birth (low birth weight, poor nutrition) and of accumulating physical and mental health problems throughout life. Poverty and inequalities proportionately increase the chances that someone will develop a disability or life limiting illness and ultimately decrease their life expectancy. (The Marmot Review Link to External Website Adobe Acrobat Format)

Child Poverty leads to lower educational attainment and aspirations for children and young people, a child's family background being the most important determinant of academic success. Child and families living in poverty will have greater difficulty in accessing pre-school education; combinations of place, circumstance and expense limit a family's access to these and wider informal educational opportunities. Nationally, Only 26.6% of children eligible for Free School Meals receive five good GCSEs including English and Mathematics compared with 54.2% of non-FSM pupils. Children whose parents have lower incomes and are from deprived backgrounds are less likely to go to university. Graduates from these backgrounds are more likely to struggle to obtain graduate-level employment and are likely to have lower average salaries that graduates from more advantaged backgrounds, particularly in comparison to those with professional parents and those who have attended non-state education (Access to what? Link to External Website And Anatomy of Economic Inequality Link to External Website Adobe Acrobat Format).

With children in poverty leaving school earlier, with lower levels of qualifications and lower expectations than their counterparts, children who have grown up in poverty are more likely than their more affluent peers to be unemployed, work in insecure, low or unskilled jobs and be poorly paid in adult life. The combination of pressures associated with poverty are likely to lead to social isolation as well as affect relationships within a family, furthermore they are likely to impact negatively on participation and cohesion within communities. (The Costs of Child Poverty for Individuals and Society Link to External Website Adobe Acrobat Format)

According to reports commissioned by the Joseph Roundtree Foundation, the costs to the economy associated with child poverty are estimated to be as follows:

  • Public spending to deal with the fallout of child poverty is about £12 billion a year, about 60 per cent of which goes on personal social services, school education and police and criminal justice.
  • The annual cost of below-average employment rates and earnings levels among adults who grew up in poverty is about £13 billion, of which £5 billion represents extra benefit payments and lower tax revenues; the remaining £8 billion is lost earnings to individuals, affecting gross domestic product (GDP).

This supposes that the total costs of child poverty are at least £25 billion every year and this includes £17 billion that could accrue to the Exchequer if child poverty were eradicated. Savings would result not just from reductions in welfare payments and increased tax contributions but also from a massive reduction in funds needed to combat the problems associated with growing up in poverty. (The Costs of Child Poverty for Individuals and Society Link to External Website Adobe Acrobat Format)

It is clear that the negative effects of child poverty are not only severe but far reaching and complex, presenting a wide array of problems in many aspects of society. We have not only a moral but also an economic imperative to make concerted and tangible progress in tackling child poverty both nationally and locally. Child poverty is everyone's business.

1.4 The Policy Context - The Story So Far

In 1999, the previous government pledged to eradicate child poverty by 2020 which had been increasing along with wider income inequalities during the 1980's and early 1990's. The Government's National Strategy focused on a number of key areas;

  • Promoting employment as the best route out of poverty and increasing incomes through the introduction of tax credits, national minimum wage, support for childcare costs and greater financial support (an emphasis on flexible working arrangements was also supported to allow more parents to fit work around family life).
  • A focus on early intervention through investment in the early years, childcare and family services; including maternal and infant health and the development Sure Start Children's Centres providing a universal offer of interagency support and networks.
  • Wider investment in local public services to tackle deprivation and narrow the inequality gap; including regeneration (Neighbourhood Renewal and Working Neighbourhoods Fund), action to increase decent and affordable homes, investment in schools and education through both capital build (BSF) and school improvement measures to 'narrow the gap', raise the participation age and promote smooth transitions from adolescence into adulthood. An integral part of this was Every Child Matters Framework, which aimed to give all children support to be healthy; stay safe; enjoy and achieve; make a positive contribution and achieve economic well-being.

For more details: Child Poverty; Everybody's Business Link to External Website Adobe Acrobat Format and Impacts of Poverty Policy Since 1997 Link to External Website Adobe Acrobat Format

Two key Acts of parliament have driven the statutory duties on local authorities in relation to Child Poverty. Whilst the Children Act of 2004 was the legal framework which supported the Every Child Matters agenda and placed a legal duty on LAs to work towards this through the formation of Children's Trusts, development of the Children and Young People's Plan and duty for partners to cooperate, it is the Child Poverty Act (which came into force in March 2010) which builds upon this to place further and explicit duties upon the Government and LAs. The Child Poverty Act 2010:

  • Places a duty on the Secretary of State to meet four child poverty targets by 2020/21, based on a relative low income measure, a low income measure fixed in real terms, a combined low income and material deprivation measure, and a 'persistent poverty' measure
  • Requires the UK Government to publish a UK child poverty strategy, which must be revised every three years, setting out policies to meet the targets
  • Places duties on local authorities and other 'delivery partners' in England to work together to tackle child poverty, conduct a local needs assessment, produce a child poverty strategy and take child poverty into account in the production and revision of their Sustainable Communities Strategies

The Coalition Government is maintaining the pledge to eradicating child poverty by 2020. In the light of huge changes currently underway in public services there will be some important implications for children, families and communities. There have, however, been a number of recent policy developments which will be of key importance in relation to efforts to tackle Child Poverty in Tameside, in particular:

  • The Frank Field Review Link to External Website Adobe Acrobat Format; Frank Field MP was appointed by the Government to lead an independent review into poverty and life chances, his final report The Foundation Years: Preventing Poor Children Becoming Poor Adults sets out the findings of the review. The review suggests that further efforts and resources should directed to the Foundation Years to support a robust preventative and early intervention approach to tackling poverty. The Foundation Years should become as important as Primary and Secondary education provision. With this he maintains that tackling poverty is about more than income and suggests shifting child benefit funding to early years services. The Frank Field approach puts greater emphasis on the home learning environment and quality early years services; to this end he highlights the importance of universal parenting programmes and the need to develop a series of "Local Life Chance Indicators" around the child, parent and environment. The Indicators should include a wider range of poverty measures aside from the income measures including cognitive development of the child, parental health and qualifications and quality of service measures.
  • The Graham Allen Review; Graham Allen chairs the independent commission for Early Intervention. The initial study of the effectiveness of Early Intervention and the more recent review complement the developing policy arena around Poverty and Social Mobility. These reports support the approach of "tackling social problems before they begin, rather than spend ever-greater sums on ineffective remedial policies, whether they take the form of more prisons, police, drug rehabilitation or supporting larger and more costly lifetimes on benefits. Like the Frank Field review there is a strong belief in channeling resources to support Prevention and Early Intervention in the first years of life but also to maintain continuous and transitionary support from 0-18 through a series of Intervening Early measures. Recommendations include building upon the top 19 Early Intervention Programmes such as Family Nurse Partnership and Reading recovery, developing a seamless Foundation Years Plan and a National Parenting Campaign.

    Chart showing support from 0-18 through a series of Intervening Early Measures

    Initial Joint Report; Early Intervention Report Link to External Website Adobe Acrobat Format Review Jan 2011: Early Intervention Review: Next Steps Link to External Website Adobe Acrobat Format
  • Changes to welfare benefit and tax credits; by 2017, the current system of means-tested working-age benefits and tax credits will gradually be replaced with the Universal Credit Link to External Website Adobe Acrobat Format. Jobseekers Allowance, Employment and Support Allowance, Child Tax Credit, Working Tax Credit and Housing Benefit will be merged into the single Universal Benefit administered by the DWP. This is part of a wide range of proposed changes and reductions in the welfare system which will have significant implications for vulnerable people and those living in poverty. In particular; the partial withdrawal of child benefit, reductions in the childcare element of working tax credit and a cap on the amount provided through housing benefit. The welfare changes are extensive but a summary and review of the impact of these changes for Tameside residents can be seen here Adobe Acrobat Format.

The policy developments noted here are of key relevance to tackling child poverty in Tameside. They are not, however, comprehensive and there are a number of other developments which will be of relevance to our efforts in Tameside; Changes to the NHS, Public Health and the development of GP consortia (see Equity and Excellence Link to External Website), the Total Place Pilots and the advent of Community Budgets/Local Integrated Services which look at place-based public services, pooling budgets and pushing down governance to communities through the localism bill (see Localism Bill Link to External Website).

In addition to this the following links provide access to key local documents which are integral to combating poverty in Tameside:

In constructing a poverty assessment and strategy in Tameside, we must be aware of the complexities of child poverty demonstrated by the range of circumstances which drive poverty and the groups which are most vulnerable to living in poverty. Not all groups of people experience poverty but some groups of people are more likely to experience poverty at some time. Whilst we can highlight individual 'risk' factors or groups such as worklessness, low wages, access to services etc we must also not lose sight of the importance of 'narrowing the gap' and playing our part in reducing inequalities. Social mobility, amongst other desirable outcomes, is more difficult in an unequal society (For more information visit the Equality Trust website at www.equalitytrust.org.uk Link to External Website). The graph and diagram below demonstrate the main household groups likely to experience poverty, the key characteristics which drive poverty and the likely outcomes of living in poverty. It is clear that eradicating child poverty requires action in a wide range of policy areas including childcare; education; health; skills; the availability, quality and flexibility of jobs; and benefits and tax credits:

Graph showing main household groups likely to experience poverty

Table showing the key characteristics which drive poverty and the likely outcomes of living in poverty

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