Working poor need more support

The working poor should be the focus of a new push to increase social mobility through a range of measures including more childcare support, according to a report by the Social Mobility and Child Poverty Commission.

The Commission, headed by Labour’s Alan Milburn, says that, although Britain has a better record on the number of children in workless families than 15 years ago, there has been a big rise in the numbers of poor children measured as being in absolute poverty and in working poor families.

It says real wages were stagnating before the recession and have fallen by over 10% since 2009. Real median weekly earnings are now lower than they have been for over a decade, putting many more families under pressure and forcing many more low-income earners below the poverty line.

The report, which covers education, apprenticeships and training and other aspects of social mobility, finds class has become the main barrier to a professional career rather than gender.

Milburn says: “The Report finds that class is now a bigger barrier than gender to getting ahead in a top professional career. Senior professionals are still more likely to be privately schooled and privileged men.”

He warns: “We conclude that the economic recovery is unlikely to halt the trend of the last decade, where the top part of society prospers and the bottom part stagnates. If that happens social inequality will widen and the rungs of the social ladder will grow further apart. The promising reforms we see in schools and some aspects of welfare will not, on their own, offset the twin problems of high youth unemployment and falling living standards that are storing up trouble for the future. We see a danger that social mobility – having risen in the middle of the last century then flat-lined towards the end – could go into reverse in the first part of this century.”

He adds that poverty affects almost half of Britain’s citizens at some point over a nine-year period and one third over four years. He states: “Today child poverty is overwhelmingly a problem facing working families, not the workless or the work-shy. Two-thirds of Britain’s poor children are now in families where an adult works. In three-quarters of those households someone already works full-time. The principal problem seems to be that those working parents simply do not earn enough to escape poverty.”

The report says the main focus of recent social mobility initiatives has been on moving people from welfare to work. However, tax credits and other initiatives have been used to ‘prop up’ the living standards of those in low paid jobs and that prop has now disappeared.

Milburn says: “The taxpayer alone can no longer afford to shoulder the burden of bridging the gap between earnings and prices. We conclude that Government will need to devise new ways of sharing that burden with employers in a way that is consistent with growing levels of employment. Making headway on reducing poverty and improving mobility requires a fresh settlement between what the state does, what the market does and what the citizen does.”

The report’s recommendations include getting the Low Pay Commission to deliver a higher minimum wage, rewarding employment support providers for the earnings people receive not just for finding them a job and reallocating Budget 2013 childcare funding from higher rate taxpayers to help those on Universal Credit meet more of their childcare costs. It also calls on employers to provide higher minimum levels of pay and better career prospects, enabled by higher skills and to end unpaid internships and recruit from a broader cross-section of society.

It says that “every citizen who can should be expected actively to work their way out of poverty by seeking jobs, working enough hours and seizing the opportunities made available to them”.

Alan Milburn states: “We say that the key influencers on children’s life chances are not schools or governments or careers services. They are parents. And we urge Government to break one of the great taboos of public policy by doing far more to help parents to parent.”

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