From Local to National:

tackling poverty during austerityJan – Feb 2012

IntroductionSeminar Programme and Aims:

o Three sessions looking at key areas: trends in poverty, the

policy responses, and the local picture

o Each session gives an introduction to key trends and policy

developments in each area. Focus is on discussion in each

session: hearing how the trends are impacting on your work and

community.

o By the end of the seminar we want to have a better sense of key

priorities for tackling poverty in the coming period

o A 'mini-manifesto' will be produced and will be used in

campaigning activities during the local elections

Income Poverty in Scotland

Total of 870,000 people living in low income h/h in 2009/10 Child Poverty continued to decline in period 04/05-09/10

(although only slightly) Important to note that CP fell when unemployment was rising

Income Poverty in Scotland

Proportion of adults in poverty showing increase since 2006 Pensioner poverty has fallen significantly over the last 10

years. But showed an increase in year to 2010. New indicator shows that around 10% of pensioners are

'materially deprived'

Inequality in Scotland Income inequality has increased in Scotland since

2004/05: share of total income going to top 30% has increased from 50% to 54%. That going to the bottom 30% has fallen from 14% to 13%

Scotland is slightly more equal than the UK, but only Portugal and Latvia are more unequal in Europe

In relation to unequal outcomes, Scotland has lower life expectancy than all more equal countries, only Latvia and Lithuania do worse

The income of the average UK household is almost 2.5 time greater than that of bottom 10%

The top 10% has 40% of all property wealth and 60% of all asset wealth.

After falling, unemployment has begun to rise again, now stands at around 8.2%, just over 2.5M. Higher in Scotland at 8.6%

Work-less households now at a 10 year high (370,000)

Unemployment amongst women is at a 23 year high

Youth unemployment now 22.6% (1.04 million)

Highest level of 'forced' part-time workers, 1.26 million, since 1992

Unemployment

Overall employment rate in Scotland is now 70.9% and 70.3% in the UK

In 2010 26 % of women and 14% of male employees in the UK were paid less than £7.50 an hour. Down by 11% and 3% respectively since 2000. Most of the fall came up to 2006

Around 5.1 million people were low paid in 2010, with around 46% in wholesale and retail. 45% of part-time workers were low paid

Still significant ‘churn’ in the labour market. ½ of all men and 1/3 of all women making a new claim for JSA were claiming less than 6 months before

Employment and In-work Poverty

During recession average incomes increased. However during 2010-11 h/h incomes feel back to 2003-04 levels

Poverty amongst pensioners and children fell during recession, due to changes in tax & benefits

Poverty is predicted to increase by 800,000 by 2013-14

Fuel poverty predicted to increase from 5.5M h/h to 6.4M in 2011

Key Messages

Poverty is not just a feature for some groups – all now affected with working age poverty increasing. The stagnating level of welfare benefits for those without children is key

In-work poverty is a real problem: the decline stopped in 2006. Not just about pay, but also the quality, availability and distribution of work.

Clear gender dimension to both poverty statistics and labour market disadvantage

Welfare reform cannot solve the problem. It is not incentives but lack of work that is the issue.

Key Messages

Discussion

How are these trends reflected in your work/community?

What other issues are important? (e.g. spending, housing, etc)

From Local to National:

The policy context

Policy context UK: Welfare Reform

Welfare Reform Austerity

Scotland Employability Infrastructure

Strategic Approaches to Poverty? There is less emphasis on a strategic approach to

addressing poverty at the UK. Only in child poverty policy is a strategy set out. No NAP, no ‘Opportunities for All’, only welfare reform

In Scotland, anti-poverty framework, Achieving Our Potential, launched in 2008. No plans for review

Child poverty, fuel poverty, regeneration, health inequalities, all in place or being reviewed

Emphasis in Scotland and UK is on localism. Makes the process of accountability more difficult: are

targets being met, are policies effective?

Austerity in the UK UK Coalition key aim is deficit reduction. Goal is to cut

structural deficit to zero by 2015

Severe cuts (£81 Billion) are being made across all parts of the public spending, except health and international development by 2013-14

Additional £18 Billion is being taken out of welfare budget alone. Some benefits frozen, more conditions placed on them, new benefits will be introduced

Significant cuts in public services will have a severe impact on the poorest – analysis suggests that poorest decile will lose equivalent of 21% of household income compared to just 3% for the top 10%

Welfare Reform1. £18 billion of cuts - 2013

2. Welfare Reform Bill, key aims:

Employment as the key route out of poverty

Simplification

Making work pay

Delivering ‘fairness for claimants and taxpayers’ ie focus on fraud and conditionality

Key Welfare Changes

ChildrenHealth in Pregnancy Grants abolishedMaternity Grant restricted to first childChild Benefit frozen for three yearsTax credit changes

Increased poverty for those with young children, especially lone parents

General changesBenefits up rated by CPI instead of RPI (expect Pension Credit)

Key Welfare Changes Tax creditsNew calculations - overall cut for working claimants (current and forthcoming 2012) Working tax credit (WTC) – Basic and 30 hrs elements frozen for 3 years, Childcare help reduced from 80% to 70%, Couples with children must work at least 24 hours, (April 2012) 50+ element scrapped (April 2012) Child tax credit (CTC)Baby element in child tax credit (CTC) scrapped

Scottish Context In Scotland, Achieving Our Potential, should set out the

broad approach to addressing poverty Targets to reduce income inequality and the proportion

of individuals remain in place, although it is not clear what specific policies are in place to reach these targets

Key policy areas include employability, infrastructure investment, health inequalities, fuel poverty and regeneration

New emphasis on community led responses to poverty, and particularly on the assets of individuals and communities

Employability & Infrastructure Key approach remains through the Workforce Plus

strategy that aims to co-ordinate local partners to improve employability

Particular emphasis on youth unemployment: creation of 25,000 modern apprenticeships in 2011, the Opportunities for All program to provide training and learning to all 16-19 year olds

Infrastructure investment is going targeted to help create jobs. Expected to invest in 50 projects over the next Parliament

All large projects will be required to have social clauses (i.e. apprenticeships included)

Key messages Welfare reform will continue to dominate the anti-

poverty policy context for the foreseeable future. This will mean an increasing importance for advice services

Continuing importance of local approaches to addressing poverty: however most local Single Outcome Agreements do not emphasise poverty

Role of the 3rd sector will be crucial in supporting people during the next recession. How can this role be delivered in the context of cuts

Increasing impact of stigma on people living in poverty during recession: what role for local and national players in Scotland to reduce this?

Discussion

How do these policies impact on your work/community?

What other policy areas are having an impact

What is the ‘local’ response to these policies?

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‘From the Local to the NationalTackling Poverty during Austerity’

Milind Kolhatkar – Edinburgh Voluntary Organisations’ Council

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Three levels:

Sub-Local

Local Authority

Scotland/UK

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Sub-Local:

The 'political' left

Transitions (type) Groups

#Occupy

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Local:

SOA 3

Economic Development

Third Sector

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National:

'Reform'Single Fire Service & Police ServiceIntegration of Health & Social CareReview of Community Planning

'Strategic Development'Achieving a Sustainable FutureChange Funds/Preventative SpendCommunity Empowerment

'The Known Unknowns'Independence ReferendumIt's the Economy, Stupid!

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‘From the Local to the NationalTackling Poverty during Austerity’

Discussion

Discussion

What for you are the key challenges ahead for tackling poverty?

What actions should local people/organisations take to address them

Who should you work with to take these forward?