Child Poverty Bill

My Lords, first, I congratulate my noble friend on government Amendment 80 on primary school children, which I think is great and terrific. I accept every argument that he has made. Everything else that I want to go on to say in no way seeks to prioritise a different group of children over primary school children. The second thing that I am delighted about is that my noble friend has made it very clear today that, as resources permit and with political will, we can extend this in due course to that same cohort of children, possibly, as they go on into secondary school, where they can take this with them. That is admirable. Let me just challenge some of the assumptions behind the arguments in favour of primary school children but ignoring secondary school children altogether. Arguments in favour of secondary children have perhaps been neglected. Let me suggest some. My noble friend said, absolutely rightly, that this is part of trying to ensure that people, especially lone parents, but also couple families, can make the transition into work without having a double hit, not only of work costs but of school dinners. That happens when they move from being on benefits with child tax credit to being on working tax credit and child tax credits, when they get cut out irrespective of their income levels simply because they are claiming WTC. What my noble friend will also know—it was his legislation, after all—is that we are bringing lone parents who until a year or so ago did not have to enter the labour market until the youngest child was 16 into the labour market when the child is seven, with work preparation from three. I absolutely, fully and 100 per cent support all my noble friend’s endeavours in that field. What that means, however, is that we have a cohort of lone parents who have children under 16 but above 10 or 11—it first came down to 12—who will be coming into the labour market over this year and next year and so on, and who will face the same barriers to making work pay as other people. This is a cohort of lone parents for whom, in the space of two years or thereabouts, the threshold will change from their youngest child being 16 to the youngest child being seven. Therefore, if the argument about trying to overcome barriers to work applies to lone parents with children of five, six or seven, it would equally apply to that cohort of lone parents coming on to jobseeker’s allowance for the first time. My second argument is a different one. It comes from the IFS research and from the department’s own research, which shows that it is older children who are more costly and who keep families below the poverty line. That is also associated with a number of those who have a child over 10, and especially over 14, which is likely to add considerably to the equivalence scale costs of those parents. If you look across the poverty line, for example, you see that a lone parent with two children under 14 is likely, thanks to the improvements that the Government have made in benefit levels, to be at or even above the poverty line on benefits, which is terrific. However, if she has two children and one of them is over 14, she may not be. The same is true if there are three children: if one of them is over 14, the lone parent is not necessarily likely to reach the poverty line, which she would do if the children were younger. I fully accept that this is a point about the equivalence scales. The same is even more dramatically true for couple families: the deficit on benefits between having children under 14 and over 14 virtually doubles in terms of the poverty line. Why is that the case? There may be a point about equivalence scales—I think that the noble Lord, Lord Freud, was quite right on this. However, it is also the fact that in this country, unlike the rest of Europe, our support for children is based on front-end loading it for the earlier children, rather than back-end loading it. This includes child benefit, although obviously the tax credit is the same for all children. In most of Europe, partly because of natalist policies wanting to encourage larger families, tax credits support later children more generously and, on the equivalent, older children. We do not. Almost everyone agrees that we should at some point rebalance tax credits, because half of all poor children live in larger families, and larger families are more likely to have children who are over the ages of 10 or 15 and therefore come below the poverty line. It is a circle that reinforces itself. The free school dinners scheme for those children is a very good proxy for failing to rebalance the tax credit line, which we should do if we are to ensure that, irrespective of family size and ages, families on benefit have equal relationships as of right to the poverty line, at 60 per cent. At present they do not. I absolutely accept the financial arguments of my noble friend. It is a big-ticket item, which is why I am delighted to hear that we can do it without requiring primary legislation in future; it gives us all a lot of head space. However, before he comes back on Report with whatever he may seek to do on any of this discussion, will he take on board the fact that the financial need is greatest for older children? This is reflected in all the stats that we have on poverty lines. The need is also greatest where there are larger families—again, that tends to be families with older children. These are the children who are not going to be getting the benefit of free school dinners at the very point in time when we are requiring the lone parent in particular to enter the labour market and suffer all the disadvantages of entering into work. Will my noble friend reflect on these issues and see whether he can help us any further on Report?