Work and Pensions Committee
Oral evidence: Children in poverty: measurement and targets, HC 188
Wednesday 23 June 2021
Ordered by the House of Commons to be published on 23 June 2021.
Members present: Stephen Timms (Chair); Debbie Abrahams; Shaun Bailey; Siobhan Baillie; Neil Coyle; Steve McCabe; Nigel Mills; Selaine Saxby; Dr Ben Spencer; Chris Stephens; Sir Desmond Swayne.
Questions 157 - 224
I: Will Quince, Minister for Welfare Delivery, Department for Work and Pensions; Donna Ward, Director for Poverty, Family and Disadvantage, Department for Work and Pensions; and Elaine Squires, Deputy Director for Income, Family and Disadvantage Analysis, Department for Work and Pensions.
Written evidence from witnesses:
Department for Work and Pensions
Witnesses: Will Quince, Donna Ward and Elaine Squires.
Q157 Chair: Welcome, everybody, to this meeting of the Work and Pensions Select Committee, the last in our series of evidence sessions on our Children in Poverty inquiry and a particularly warm welcome to Will Quince, the Minister for Welfare Delivery. Thank you very much, Will, for being with us. Would you like to introduce your colleagues who are with you today?
Will Quince: Thank you, Chair, and thank you for kindly having us. With me today from the Department I have Donna Ward, who is the Director for the Poverty, Family and Disadvantage directorate and Elaine Squires, who is our lead analyst in the same directorate.
Q158 Chair: Thank you both very much for being with us as well. Can I put the first question to you, Will? The Department’s written submission to this inquiry favoured the absolute measure of the number of children in poverty. Others have argued to us for a relative measure, perhaps as one of a number of measures. What do you see as the advantages of focusing on the absolute measure?
Will Quince: The first thing to say is that, without question, poverty is a complex subject and there are many different ways of measuring it. Most stakeholders agree that income is a key component of any poverty measures, but a range of measures are needed and that is exactly why we have a statutory duty and we do publish numerous measures via the HPI statistics.
As a Department, we track and monitor many different aspects of poverty including our four statutory measures, which are relative income, absolute income, combined low income and material deprivation, and persistent poverty. In terms of why, although we publish all of those, we broadly favour absolute is largely because relative poverty can provide rather counterintuitive results. For example, if you look at the course of the past year, relative poverty is likely to fall during recessions or during periods like that which we have had over the course of the past year, where so many people have either sadly lost their jobs or seen a significant drop in income, due to falling median incomes. Under that measure poverty can decrease even if people are getting poorer, whereas the absolute poverty line is fixed in real terms, so in essence will only ever worsen if people are getting poorer and only ever improve if people are getting, for want of a better word, richer.
The other and final reason is that, if you look at the British Social Attitudes survey, it found that around 28% of the public see poverty as not having enough to buy the things that most people take for granted, but nearly 90% of people see poverty as struggling to afford essentials, such as, for example, energy bills, transport, and the essentials for cost of living without getting into debt. That is why I think our preferred measure or focus is on absolute, but we do publish all those statistics because it is part of a suite of measures that gives us a broad picture of poverty across the country.
Q159 Chair: Do you think that we should be looking at different degrees of poverty? For example, some people have been talking to us about the number of children in households whose income is less than 50% of the median, rather than the normal 60% measure that is used. Do you think that different degrees of poverty ought to be analysed?
Will Quince: That is a fair question and, yes, we do already publish different depths of low-income poverty, so we use a 50%, a 60% and a 70% of median line as part of our annual publication of households below average income. We also publish, and this is equally important, a combined low income and material deprivation measure, which uses a 70% of median low-income measure, and a combined severe low income and material deprivation measure, which I believe uses a 50%—and I know officials will be able to confirm—of median low-income line.
It is important for us to understand what is going on below the poverty line, as well as what is going on in or around the line. There is no statistical reason why someone just above, say, 60% of the median should not be classed as in low income while someone just below that line is. Arguably by fixating on an essentially arbitrary line—so, say, 60% relative to the median—there is always the danger that there is an incentive for policy choices by Ministers or broader Government to be targeted at moving the just in poverty, or those in or around the line, over the line as the most effective way of bringing down targeted measures of poverty.
I do not know if either of our officials, Donna or Elaine, want to talk about deep poverty. They are the specialists in this field.
Donna Ward: Yes, we have looked at deep poverty and there is a real difference between people who are in deep and persistent poverty and a wider population in poverty. They are much more likely to be in social housing, long-term workless, larger families. It does give an extra insight,
and they are much more likely also to be out of work with a disability. Definitely looking at depth persistence as well as just income at a point in time is very much what we do as a poverty team to understand the problem.
Q160 Chair: A final point from me. We understand that New Zealand uses a measure along the lines of the absolute measure that you have advocated, but they have committed to review the base every 10 years, given that things do change quite a lot. Do you think there might be merit in a regular, periodic review of the base for the absolute measure in that way?
Will Quince: Officials will correct me, but my understanding is it is done at around every 10 years at the moment, but we are always looking at ways to learn from innovations around poverty measurements in other countries. We also review and consider guidance around poverty measurements from international bodies, including the United Nations. Although there is not an international consensus on the right way to measure poverty, we are of course open to looking at the ways in which other countries measure poverty and if there are things we can learn and adopt here of course we will explore them. I do not know if Donna or Elaine would like to come in with more detail.
Elaine Squires: The Minister is right; it was set in 2010 for the absolute line. It is something that we keep in review, so I do not think there is a kind of standard that you should review it every 10 years. You really need to look at what has been going on in the economy and if we need to review that line. It is something along with many other things in the poverty statistics that we keep a check on, on a regular basis.
Q161 Chair: Would you expect that to be reviewed soon, given that 11 years have passed now?
Elaine Squires: Again, because it is 10 or 11 years since then, it is something that we are definitely looking at, as to whether we should do that. When you do that you then cannot compare back, so in a way you start another time series. It is not something that you want to do regularly, and you need to think about the consequences of doing it. As I say, it is something that we are currently reviewing.
Will Quince: I suppose that is one of the disadvantages of absolute versus relative, in that when you do reindex it is then harder to track medium to long-term changes. Despite the many other advantages that is probably the biggest disadvantage and, as Elaine said, if we were to in effect redo the baseline it would then present us with some challenges of tracking longer-term trends.
Q162 Sir Desmond Swayne: Comrade, a couple of years ago you announced that the Department was working on measuring poverty by some new statistics along the lines of the Social Metrics Commission methodology. Baroness Stroud has told us that not much progress has been made and that the oomph seems to have gone out of it. Do you have cold feet or is it just down to the pandemic?
Will Quince: Thank you very much for the question. We have certainly been presented with some challenges and I wish we were much further on in our work on this metric. You rightly identify that, given the enormous pressure placed on our services as a direct result of the pandemic and having to redeploy staff across the organisation to the processing of claims in a short period, nearly doubling the number of people on Universal Credit, that had to be our focus. In addition, we had to focus our attention rightly on delivering targeted and practical interventions to help disadvantaged people throughout what has been the most challenging of periods.
The evidence does suggest that those interventions have worked and according to HMT analysis the poorest 10% of working households have seen no loss to household income as of November last year.
In terms of your broader question, the Office for Statistics Regulation pointed out in the review of the poverty measures that there is room for improvement around our current poverty statistics. We recognise that; that is why I made the announcement around two years ago, in particular around timeliness of these statistics and underreporting of benefit issues.
Our current priority is to improve the quality of our statutory measures before considering any further work on the SMC measure specifically. It is paused at this moment in time but what I would say is many of the changes we are making to the Family Resources Survey—so things like increasing the sample size, further linking with administrative data—will benefit the Social Metrics Commission’s measure as well as the Department’s statutory measures.
In terms of having a single measure of poverty, the Office for Statistics Regulation recently reported that one measure could not adequately meet all the multifaceted and differing needs that users have for poverty statistics. Yes, we continue to look at this measure. I do not have a date for starting those works again, but any future measure would be alongside the other suite of measures that we already publish as part of the HPI statistical release annually. Donna?
Donna Ward: On the Covid emergency, I have diverted a lot of my team to things like work on the Budget where we managed to get the £20 uplift extended until September but also putting a team on the Covid local grant, which has also just been extended. We have been running that since October last year, with £400 million going to local authorities. Genuinely, we have shifted our priorities on the poverty side over the pandemic and that is what a lot of people have been working on. As the Minister said, in parallel, our top priority for our Secretary of State is to double the sample size of the Family Resources Survey, which I think will benefit all of the measures because we are working with two small samples for some of the ambition of some of these measures. Genuinely, we have been diverting people on to lots of new and important tasks over the Covid emergency.
Q163 Sir Desmond Swayne: When you spoke of improving the quality of the existing statutory measures, does that imply specific initiatives beyond the increasing of the sample size that you have just spoken of?
Donna Ward: It also includes a linking to administrative data, but I will let Elaine explain that.
Elaine Squires: Lots of the recommendations that were in the recent OSR report are things that we are already doing. We continually review our statistics and try to improve them. One of the things that we have been doing over recent years with the Family Resources Survey is linking admin data, so that we can improve some of the timeliness and the accuracy around statistics. Lots of the monetary information we collect in the interviews is not correct. When we are able to link that with admin data, we are able to make those corrections. For example, in 2015-16 we were only able to link about half of the interviews with admin data, whereas in the last year that we have published we were able to link 95% with admin data. What that means is we are improving the accuracy. We are also automating some of the processes that sit behind the statistics, because it does take, as you know, a year for us to produce the households below average income theories, and that is because there is lots of detailed data cleaning and analysis that has to be done to the level of National Statistics standards. Linking to admin data and then automating those processes improves both accuracy and timeliness. We are trying to improve that all the time. We have been doing a lot and a lot of the things that OSR have suggested in their review are things that we are already working on to improve the data.
Q164 Sir Desmond Swayne: Is there any read across from the levelling up agenda to a greater urgency and importance of the ability to measure the levels?
Will Quince: In terms of us wanting to get far richer data, the Family Resources Survey is a brilliant piece of work. It gives us some rich data that we can take evidence-based decisions on, and it allows us to look at future policy and the impact it might have. One of the limitations that we had with the FRS was the sample size—and Donna or Elaine might correct me if I am wrong—which meant that we were not able to drill down into regions and even, dare I say, constituencies to look at the work around levelling up and geographical regional disparity and inequality at the level of detail that we would have liked. By increasing the sample size of the FRS, which was a decision taken by our Secretary of State, we will be able to do far more of that. Donna, you are the lead on this. Would you like to comment further?
Donna Ward: We are constrained on the levelling up side by the geographical breakdowns that we can do on poverty. By using admin data, we are able to do that much better. The recent publication by ONS on child poverty statistics at local authority level was achieved by using admin data, both our own and HMRC’s. If we do not make those kinds of innovations, we will be constrained. With the current FRS we only look at regional data and, even then, only on a three-year average a lot of the time, so definitely for levelling up, which is about places as well as people, we need better data.
Q165 Chair: Can I clarify one point? You announced two years ago that the Department was developing these new statistics to measure poverty drawing on the Social Metrics Commission’s methodology. You have explained to us that that work has been paused. Does the Department remain committed to doing that work, or does that commitment no longer apply?
Will Quince: Ultimately, you are absolutely right. I announced that two years ago under the previous Secretary of State. No decision has yet been taken on when to continue with that work and that decision would be taken by the Secretary of State.
Q166 Chair: So at the moment the Department is not committed to pursuing that work?
Will Quince: It was one strand of work as part of our broader look into poverty measurement. What we have not done yet is taken a decision on when we would restart that work following the unfortunately long pause because of the effects of the pandemic on the resource capability of the Department.
Q167 Chair: By the sound of it there is not a commitment to pick that up necessarily at any point in the future.
Will Quince: To answer your question, unfortunately only the Secretary of State, no doubt alongside No. 10 and the Cabinet Office, will decide on that. What I would say is that I think that, without question, there are advantages and disadvantages to the SMC measure. As you know, Chair, I think that the measure has a place and the work that we are doing—even the work that we have done throughout the course of the pandemic in relation to the FRS—will help improve the quality of that measure too. But it is a measure with limitations, and I think my Secretary of State does have some concerns about that but, as I said, the debate on that is very much still live. We have not taken a decision because we are not able to unpause that work at this stage, but no doubt both I and the Secretary of State will keep the Committee posted on the progress in that regard.
Q168 Neil Coyle: The advisers with you today seem to suggest that there is a lack of reliability about some of the data and there is a paucity in the data. Could you tell us when you expect to have a data set that enables you to tell us where needs levelling up, and what policies are you specifically pursuing to tackle child poverty when it comes to your levelling up agenda? You know as well as I do, Minister, that many people think it is just a mantra.
Will Quince: Mr Coyle, it is certainly not a mantra and I think the biggest and most fundamental change is the decision by this Secretary of State to double the sample size of the Family Resources Survey. We are confident that will give us a level of robust data that will allow us to drill far more into regions and possibly even deeper than that, which will give us a better idea of where we need to better target resource around the country.
You will forgive me—or perhaps you will not—for not going into some of the detail around future policy formation ahead of fiscal events, but work is ongoing as you would expect across Government to look at a suite of measures that will feed into the broader levelling up agenda and of course will have a positive impact on broader poverty and child poverty and the tackling thereof.
Q169 Neil Coyle: The doubling of the FRS is to what sample size? Is Universal Credit in the mix of areas being considered for review, for example given its impact on foodbank use or the level of debt, given that the DWP loaned £1 billion last year?
Will Quince: That is a fair question, Mr Coyle, thank you. I will hand over to Donna to talk in a bit more detail about the Family Resources Survey itself, but what I hope you will be pleased to know—because I know that you are a passionate campaigner on food insecurity—is for the first time, in April 2019, we put questions on food insecurity into the Family Resources Survey for last year. We have had the first results of those this year following the Family Resources Survey of last year. I hope you will be pleased to know that we have added additional questions for the Family Resources Survey for this year, from which we will get the results next year on foodbank use also.
One of the key things—and I have given you this commitment before and I will continue to do so—is that we are very keen to identify what the key drivers are of food insecurity in this country, and I think by adding those questions around foodbank use it will give us an even better picture. I hope that gives you a level of comfort around the work that we are doing and how seriously we take it. I will hand over to Donna Ward who will talk a bit more about the Family Resources Survey in terms of the sample size and some of the data we hope to get from it.
Donna Ward: We intend to increase the sample size to 45,000 households from just over 20,000 now and that work is starting in terms of interviewing additional families this year. You know about the lag in getting the data, but that work is underway this year and we are looking at a 45,000-household target. When would we expect to publish with the new sample size, Elaine?
Elaine Squires: That will be the 2021-22 data so on the current timescale it will be published in 2023.
Donna Ward: In the meantime, of course, the Cabinet Office and others have lots of information informing the levelling up agenda, whether that is economic indicators or labour market data. There are all sorts of other things as well and we do have information by geography on poverty. It is just that you have to amalgamate a number of years together to shed light on that. Increasing the sample size will help us have much more real-time data.
Q170 Shaun Bailey: Sticking on this point around data, Minister, we have just heard there about the possibilities of potential real-time data. What scope is there for the Department to produce some sort of real-time reporting mechanism that would enable real-time tracking of poverty, particularly for example using administrative data?
Will Quince: That is a particularly good question. The timeliness of these statistics is definitely an area that we are exploring, particularly in the wake of the pandemic and the challenges this has posed with measuring changes to income in real time. Measuring and analysing data or income is without question a multistage process and it takes a year from the end of the field work period to clean, analyse and quality-assure the data before we are able to publish it. This is not unique to the UK; I think it is important to stress. It is a problem that is faced internationally.
What you are right to identify is that the lag prevents our measures from accurately understanding levels of poverty in the UK in real time. What we are doing is planning to look at the potential of the administrative data so that we can as you rightly point out enhance the decision-making process on more timely and accurate information on incomes and poverty. Donna, as you are the expert, do you want to talk any more about that, as you are the expert?
Donna Ward: Yes. We do use our Universal Credit administrative data all the time. Even though it is still not linked to survey data, the administrative data that we do have is highly informative. We saw the caseload on Universal Credit increase rapidly over Covid and we were able to see all of the characteristics, the incomes of those new claimants and how other claimants’ incomes had shifted over the pandemic. Just because we are not able to publish the official poverty statistics more quickly, rest assured that we are looking at the admin data in real time a lot. This has informed policy decisions over the pandemic.
It really helped us in the March Budget decision to get the £20 uplift extended. We have shared data with local authorities for the Covid local grant administration. Although the poverty statistics are the gold standard, where we have all the household characteristics and everything combined, the admin data is rich. It comes out every month and we use it a lot for policy decision-making, which gives us much more up-to-date information.
Will Quince: I think it is also important to stress that we already use administrative data to check on the accuracy of monetary amounts reported during the interview, as well as the respondents’ eligibility for various elements of state support in the Family Resources Survey. We are very much in the stage of development of our processes to better link and then integrate administrative data to the Family Resources Survey and that work is very much continuing.
Q171 Shaun Bailey: Going on that line, though, it would seem that at present perhaps—just given the nature of the space we are operating in that at times—some of the interventions have to be quite reactive to the situation that is there. What scope is there, particularly as you have just discussed the wealth of data and the enhancement of the quality of some of this data that is coming on, to move to a much more proactive state of intervention, where we are heading off some of these broader issues before they are exacerbated and become much larger?
Will Quince: I think that is right and that is exactly where we want to get to. The data are all important in that. In recent years—and Donna and Elaine will be able to talk about this in far more detail than I can—we have been able to significantly improve our survey administration and data-linking approach. For example, in 2015-16 around half of our data set were able to be linked with administrative data, both in part due to the number of respondents consenting to their responses being linked, but also our ability to match the variables collected in both the Family Resources Survey and the administrative data. This very much limited the analytical potential of the data set, but I think if you then look at the 2019-20 figures the successful match rate for linking Family Resources Survey respondents to their administrative data set was 95%, so a significant improvement, and that allows us far more potential in using the linked data. You are absolutely right, the place we want to get to is close to real-time information. That will enable us to better inform the policy decisions that we take across Government. It is absolutely the direction of travel.
Q172 Shaun Bailey: A couple more questions from me, if I could, Chair. If I could turn your attention, Minister, to definitions again. Looking at international examples, what work has the Department been doing in looking at some of the work of international partners and how has that been useful in trying to frame that definition of child poverty?
Will Quince: It is a good question and I think, although there is no international consensus on the right way to measure poverty, some countries do publish non-monetary measures. Others focus on monetary indicators and the UN, for example, recommends the use of a material deprivation index in its dashboard of measures. The EU has its statistical arm, Eurostat, and it measures relative low income at different depths in both mean and median income.
I think we do look very closely as a team. We have a great team of analysts who look at what is happening internationally. The Republic of Ireland has a particular measure, for example. It has three main measures on relative low-income deprivation and then a combined low income and deprivation measure that is known as consistent poverty. The USA uses an absolute measure of low income that I believe is updated with inflation and then New Zealand—which I think was referenced earlier—reports annually on 10 measures of child poverty. That includes income-based measures and hardship-based measures. Elaine and Donna are our experts, so perhaps they would like to come in to talk about the work we do looking at international comparison.
Donna Ward: I can start, and then Elaine can take over. Broadly speaking, our income-based measures are fairly in line with what other countries do, especially given that we offer such a range of income-based measures. I think those countries that develop indexes of deprivation, for example, are especially useful. Because that combines people’s experience of poverty but also highlights some of the drivers and indicators of hardship. Although we have not developed those into a bespoke poverty measure, we are tracking the drivers of poverty in parallel. In fact, the shift in 2017 to improving lives indicators, worklessness, educational attainment and some of the broad suite of disadvantages that are associated with worklessness, I think borrows from international practice on the basket of indicators of deprivation. Elaine, do you want to say anything else about international issues?
Elaine Squires: Just to add that, as the Minister and Donna have said, we do look at what is going on internationally and we speak to our counterparts in other organisations. ONS works quite a lot with Eurostat, and we link in with the ONS people measuring our poverty. We have recently had discussions with statisticians in the Republic of Ireland around its measures. As well as looking at measures we also talk to analysts in other countries about innovations that they are doing around poverty measurement.
Q173 Selaine Saxby: Good morning. Is the DWP working with other Government Departments to link administrative data across social security, tax, education, and health to better understand poverty, its causes, and its consequences?
Will Quince: It is a great question and the answer to that is yes. It is very much cross-cutting work and we have recently been able to make use of a database RAPID, which is the Registration and Population Interaction Database. I know that Donna or Elaine will be able to talk more articulately and eloquently about that so, if you are happy, I will hand over to them to explain what exactly it is and what we are doing across Government.
Donna Ward: Do you want to explain RAPID and then we can talk about some of the data shares that we have done with the Department for Education?
Elaine Squires: I can, yes. We have used the RAPID database to publish the children in low-income families statistics, which were first published in April 2020, so the second series this year. It uses the database that has 100% extracts from both DWP and HMRC data, so that gives us all citizens across the tax year, including benefit, employment, and in-work interactions. We have been able to publish statistics right down to ward level and constituency level around children in low-income families. It is linked to the household’s below average income data, which gives a property measurement. That is a real innovation and improvement on the data that was used to do that previously.
We are also working with ONS and HMRC to investigate how we can go further. At the moment we are only able to do that for families with children. We are looking at the possibility of doing it for working-age people without children and pensioners, although that is much more difficult because we need to be able to link households. We are looking at how we can expand that series.
Donna Ward: We have worked with the Department for Education to link its data on children in schools to our data, so that it can track our data and HMRC data and track children’s passage through the education system and then into the labour market or the benefit system, so we do work with other Government Departments.
Will Quince: Hopefully, it will give you a level of comfort that the Department for Work and Pensions statistics producers are key members of a cross-Government steering group with others that are working in this space, including the ONS, HMRC and the devolved Administrations. We are working closely with the ONS and HMRC to investigate how administrative data can be used more widely throughout the digital process.
Q174 Selaine Saxby: Professor Taylor-Robinson from Liverpool University told the Committee that he was seeing great steps towards linking administrative data in both Wales and Scotland, but that progress was slower in England. Do you agree with that assessment and, if so, why are things different in England?
Will Quince: Let me hand over to officials who lead on the data.
Donna Ward: I do not know the answer to whether our data linking is slower than in Wales and Scotland. I think we would have to write to you on that. I think data linking is probably quite a slow process and there are a lot of different practical and legal hoops to go through, but I do not know why other countries are doing better and would have to write to the Committee on that.
Will Quince: We would be happy to do that.
Q175 Selaine Saxby: Thank you. In a recent review of poverty statistics, the Office of Statistics Regulation recommended that the Department should work more closely with the Office for National Statistics. With that in mind, where do you think responsibility for poverty and inequality statistics should sit, with one Government Department or split as it is now?
Will Quince: It is a good question. I do not particularly have a view on that. I will hand you over to Donna or Elaine, as the statisticians and experts, to see if they have a particular view.
Elaine Squires: We do work very closely with ONS already on the statistics. All of the statisticians who work in DWP are working to the same guidelines, same standards, as statisticians in ONS. I think that although we are in different Departments the work on poverty statistics is joined up. The OSR did recommend that there may be better joining up because we produce different data sets. That is something that we are looking at with ONS and what we want to do going forward, so certainly there are improvements that can be made but we are already working closely with ONS.
Will Quince: The important thing to stress is that my understanding is this report came out in May this year, so it is a very recent report. Some of the recommendations we can look to implement pretty quickly. Others are going to require some more detailed consideration and planning to take forward, but we will absolutely commit to update users on our plans in that regard as they develop.
Q176 Chair: Can I pick up a point here? We received written evidence from Administrative Data Research UK, which is an ESRC programme working with ONS. I will read you a couple of sentences from their written submission to us. They say, “ADR UK is currently working closely with the Department for Education to link its data with that of other Government Departments and enable greater secure access to it for accredited researchers working on projects in the public interest, including in relation to child poverty. We are also in long-running discussions with the Department for Work and Pensions about enabling access to data, though there have been some barriers to accessing DWP data in contrast to that held by DfE”. They appear to be experiencing more difficulty getting DWP data than Department for Education data. Are you able to comment on that?
Will Quince: I did see that, and I think I am going to have to look into that and find out why. Chair, it may be one that we pick up offline and look at in more detail. I do not know if Donna or Elaine want to comment, otherwise I suggest that we pick it up offline once I have had a chance to discuss that with officials and see what steps we can do to wherever possible remedy that.
Donna Ward: I think it is a case that a large number of organisations do ask for DWP data. There just are a series of legal and practical obstacles that must be overcome. We do have a team that works on that, but I think we end up getting a lot of requests and it is quite resource intensive. I am sure that some people are experiencing a backlog for that reason, but we can write to you on that specific example.
Chair: That would be helpful. Thanks very much. Chris Stephens?
Q177 Chris Stephens: Thanks, Chair, and good morning, Minister. Some policy questions for yourself, and some of the questions I had have already been answered. You may recall Baroness Stroud’s evidence with us, and you appeared to agree that a measure on living standards is something you are looking at. Are you considering the Institute for Fiscal Studies suggestion of consumption and material deprivation alongside a better measure of income adjusted for costs?
Will Quince: I will hand over to Donna, first and foremost.
Donna Ward: Sorry, I did not hear that last bit of the question. I heard “material deprivation” but what you said—
Q178 Chris Stephens: I am basically asking the Minister if the Department is considering the Institute of Fiscal Studies’ suggestion that we should measure consumption and material deprivation alongside the measure of income adjusted for costs.
Donna Ward: Consumption and material deprivation. We already look at income and material deprivation. Our main data sources do not measure consumption and expenditure, so that would be quite a major change for us, if that is what you are asking. We do measure material deprivation, and it is very informative.
Q179 Chris Stephens: Minister, we have heard about the Family Resources Survey. The debt charity StepChange recently told the Committee that, if people have credit, any poverty assessment should deduct from the level of income allowing for debt repayment and the Social Metrics Commission have also made that point. Do you agree that—
Will Quince: Apologies, I did not catch the end of your sentence. Would you mind saying that again?
Q180 Chris Stephens: Sorry, yes. Do you agree with StepChange and the Social Metrics Commission in relation to people having credit that any poverty assessment should deduct from the level of income in allowing for debt repayment? Do you agree with that, Minister? Is that something that the Department is looking at?
Will Quince: Yes, so we do not collect information in relation to debt at the moment. Elaine or Donna will explain why we do not and the challenges that prevent us from doing so.
Donna Ward: With all of these big surveys we are constrained in the number of things that we ask people in order to make the interviews a reasonable length of time that people would be willing to do them. We also have to verify the information that we get from people. Debt is one of the difficult things where it is very time-consuming and difficult to get accurate information. At this moment in time, it is not part of the Family Resources Survey collection, but I do recognise that it is a huge issue for families, and we do know looking at our admin data that people on low incomes owe money in lots of different ways, including to Government themselves. Elaine, is there anything else you want to say?
Will Quince: I recall reading that, because over the course of the past year we had to switch the Family Resources Survey to largely by telephone, it was considered that the questions around debt would not give us the statistics that we need, because people would not feel comfortable answering those questions over the telephone. I remember reading that, but you may have some more information.
Elaine Squires: That is right. We have been considering adding debt questions to the Family Resources Survey but, as the Minister said, because we had to switch the Family Resources Survey to be a telephone survey during the pandemic—it is normally face-to-face—we had to cut the length of the survey. Those questions did not get added and we also had to cut down on other questions that were normally asked. We have not returned to face-to-face interviewing yet, because of the pandemic.
The survey at the moment is shorter than it normally would be, without even adding additional questions and each year we look at the questions on that survey. There is a user group—not just Government but all users—who are asked to comment on the survey and every year people want things added to the survey, but we have to bear in mind keeping it at a reasonable length so that we will get a good response rate from people, otherwise we will not have robust data. That is a long way of saying that at the moment we do not have those questions on there.
Q181 Chris Stephens: Is it the Department’s intention with face-to-face questions that debt questions will be added into the survey?
Elaine Squires: They are not on this year. When they start the process of looking at changes for next year, which normally starts in the autumn, they then will have to go back in along with other questions to see what gets added. If there are other priorities they may well not be added, but that is all part of the process that the survey team goes through each year.
Will Quince: Again if it gives you a level of comfort, Mr Stephens, I think we do recognise the value of having those questions as part of the survey. Of course, there are always competing interests in terms of the length of the survey and what you include or not, but I think that would be an important component and one I would certainly support adding back into the resource survey at the earliest possible opportunity.
Q182 Neil Coyle: Perhaps there would be fewer competing interests if the Government had not had to add food insecurity questions into the survey to replace the debt ones, if they had done the work that you told this Committee was underway on the foodbank inquiry, Minister.
Will Quince: Is there a question there, Mr Coyle?
Q183 Neil Coyle: Perhaps you want to give us an update or explain how you managed to tell the House that work was going to be published last summer that the Government have since claimed was cancelled last year.
Will Quince: No, Mr Coyle, the position has not changed. I think as per the letter from Peter Schofield, the Permanent Secretary of the Department, to the Chair of this Committee the external research project, which looked at foodbank growth, initially considered in March 2018, was not commissioned, and did not go past the initial planning phase. A literature—
Q184 Neil Coyle: Why, then Minister, did you tell the House that it had?
Will Quince: No, hold on, please, Mr Coyle. A literature review was initiated but the Department prioritised—as I have told you on at least two occasions so far—resource away from the work strand due to the unprecedented challenges and pressures on the Department due to Covid-19. The important thing to stress on that is a literature review summarises publicly available information and does not contain any new research carried out by the Department. However, work on the literature review is ongoing and we constantly review foodbank and food insecurity research done by third parties and filter this into our understanding.
Again, I want to give you a level of comfort about our intention and commitments to better understanding food insecurity. Hence why we commissioned the questions as part of the Family Resources Survey for the first time ever in April 2019. We now have the first iteration of that data, and it is why we have now gone further and included questions on foodbank use into the latest version of the Family Resources Survey. That is important because it is independent and is a huge data set. We are absolutely committed to better understanding not just foodbank use and food insecurity but the drivers of both of those issues.
Q185 Neil Coyle: I have worked with the Minister for many years on homelessness and other issues and I would like to take him at his word but, Minister, you have told us one thing in this Committee and in the House that simply the Department has contradicted.
Let us move on to data sharing, because Tower Hamlets is the 10th-most deprived area of England and, if levelling up is to prove to have any substance, is one of the areas of the country where it will have to be proved. Tower Hamlets, the London Borough of Tower Hamlets, has said it does not have access to full Universal Credit data and the Committee recommended that more was shared, basically. You told us that the Department had developed a prototype data-sharing model, which sounds great, but where is it and how will it work?
Will Quince: Okay, yes. I saw the evidence to the Committee that some local authorities said that they have insufficient UC data to target specific families. I think we are always going to be in the position that local authorities and third parties are going to want more data from us. There are limitations as to how much we can give, both by legal constraint, by consent and GDPR but also based on the resource that we have available to process those requests, as Donna Ward rightly pointed out.
It is important to stress that the Department already shares Universal Credit data with local authorities in a number of ways. This includes, for example, individual case level information via a DWP IT system called Searchlight, which we give local authority staff access to. There is a daily bulk share of relevant Universal Credit new claims and changes of circumstance for the specific purpose of local council tax reduction schemes. We recently introduced a monthly share of additional Universal Credit data that allows local authorities to administer more efficiently some aspects of local welfare delivering, for example, the Covid local grant scheme, which is the latest iteration of the Covid winter grant scheme.
Both through our formal consultation moves and from informal feedback and the feedback you have just given us, which was fed into the Committee, local authorities have made us aware that they would benefit from both improvements to those existing data shares and additional Universal Credit data. What we have done is established a project to conduct more detailed research into how we could potentially fulfil some of those requests.
I will hand over to Donna or Elaine who can talk in a little bit more detail about where we are with data. I would conclude by saying that we are absolutely committed to involving local authorities in that research and it is most likely that we will be able to do that over the late summer, early autumn.
Donna Ward: The Minister has clearly outlined the data shares that we are already doing and feedback we have had from local authorities that participated in the Covid local grant scheme—which is all of them—is that they did have the data they needed for that. Without devoting additional resource to data sharing these are the key areas that we are delivering at the moment. We are now, as the Minister says, collecting in information from local authorities about what else they want, how quickly, for what reason and then working out via a project what can be prioritised and at what cost. I do think the Department already does a lot with local authorities and there are quite a lot of protections around data, legal and practical obstacles, that we do have to adhere to.
Q186 Neil Coyle: The question was: where is the prototype data share model that the Department said was out there or existed last year? You seem to be rowing back a little bit and saying you are doing a lot already. This is something that would help tackle fraud, so, if you can get this right, it will help tackle fraud and help local authorities to deliver more effective poverty intervention measures. Can you put some more data or information on this project group and this other stuff that is going on and who is involved? If you cannot give us the detail this morning, Minister, perhaps you could put something in writing about who has been involved? If local authorities want to be more involved how can they be? I am really pleased to see that you are willing and interested in hearing from local authorities and devolved Administrations about what they would like to see done differently, perhaps, or in ways that could cut costs.
Will Quince: These are all fair challenges. We have to look at the reasons for the requests for needing the Universal Credit data. One of the key challenges that we have, which will not come as any surprise to you, is making sure that legal gateways exist to be able to provide that data. Then ultimately, we need to consider the cost and benefit and value to the taxpayer overall. Of course, we recognise that local authorities do have an important part to play in assisting with tackling child poverty and as you rightly point out tackling some of the issues around fraud too.
I am happy to either write to you or hold a separate session for yourself, Mr Coyle, or any other interested members of the Committee with officials to go through data sharing, what we have done to date and talking about some of the limitations so that you understand what we can and cannot do at the moment and why and what our future plans are.
Q187 Neil Coyle: I think that would be really helpful to all members of the Committee and, as I say, it is great that unlike some of your comrades you seem to want to give it to local authorities. Perhaps we can set a date on that. To press you a bit further, if this is a group that is meant to report in the summer or autumn, when would this new model be fully implemented? Can you explain why the Department has not chosen a presumed consent model that would cut through a lot of the barriers that have been erected?
Will Quince: The consent issue is a complex one and we could probably hold an entire hour-long session on that one issue alone. The biggest challenges and the reason I cannot give you a date post the work that we hope to do over the summer and autumn, is that we do not know what legislative changes may or may not be necessary. As you know the timetable can make that difficult to predict. The other is that there may well be, in fact it is probably highly likely that there will be, cost implications and therefore this might have to be part of a fiscal event or spending review bid. They are the reasons why I cannot give you a definitive timeline and that this piece of work may unfortunately take longer than we want it to.
Q188 Neil Coyle: A final question, local authorities like Tower Hamlets have also pointed out that housing costs—unavoidable housing costs, rent or mortgage payments, whatever it might be—need to be considered when assessing local poverty rates. How would the Department incorporate the views of local authorities about that area of non-disposable income?
Will Quince: That is a fair challenge. At the moment children in low-income family statistics are published before housing costs. Donna or Elaine will correct me if I am wrong on that. These statistics use administrative data on incomes drawn from HMRC and DWP to enable us to publish the data at local authority, constituency and ward level. Where we have a challenge—and I think this is the point that you are alluding to—is that there is no administrative data set of housing costs for individual families.
This is why publications are produced before housing costs. Groups like End Child Poverty, which is the campaign that I know many MPs received at the beginning of this year, used modelled estimates of housing costs rather than data on housing costs of individual families to inform their statistics. I am not sure, in fact I question, if it is even possible to get that data. We cannot get it. I doubt anyone can either and I will hand over to Donna or Elaine who might be able to either correct me or tell me that I am on the right track.
Donna Ward: You are right, we do not publish it after housing costs because we do not have the housing cost information for individual families. Elaine, I do not know whether there is anything else we can say on that. It would be a huge piece of work to try to impute that in some way.
Q189 Neil Coyle: But you do know average housing costs for areas, and you certainly know social housings costs for different local authorities. Any measure of poverty that fails to take into account housing costs, be it in Tower Hamlets or Edinburgh where housing costs are so much higher, is pretty meaningless.
Will Quince: I think we recognise the value of the data that you are asking for if it were available.
Q190 Neil Coyle: Are you looking hard enough?
Donna Ward: There are resource limitations. Of course, all of our statutory measures are published before and after housing costs. For some of the other ad hoc statistics we do make use of the information that we have, but there would be quite a big resource element to take the data sets that we use for the local authority level child poverty and then to impute housing costs in all of them. It is just a question of resources and prioritisation, because we do produce a huge amount of poverty information already.
Q191 Steve McCabe: Good morning. Minister, given the significance the Government attach to worklessness as a key factor and indicator poverty, why do you think 64% of people in poverty are living in families where someone is in work?
Will Quince: Thank you for your question, Mr McCabe. You are right that the Government, certainly since 2016, have put a huge emphasises on worklessness and the causal relationship between, for example, income worklessness and educational attainment. We know that full-time work substantially reduces the chance of poverty. The absolute poverty rate of a child, before housing costs, in a couple family where both parents work full time is only 3%, compared to 47% where one or more parents are in part-time work.
The other thing we know is that parental worklessness is also associated with multiple disadvantages that we know hold families back. For example, children growing up in workless families are almost twice as likely as children in working families to fail at all stages in their education. As you rightly point out, worklessness is one of the national indicators. It is one of nine that the DWP uses to track our progress in tackling the disadvantages that affect families and children’s outcomes.
These are divided into two main groups. The first of those indicators tracks the prevalence of parental disadvantages. That includes, for example, long-term worklessness. The second group tracks children and young people’s education and employment outcomes. Since 2010 I believe we have seen 600,000 fewer children growing up in workless households.
Your question also touched on in-work poverty. We have a huge piece of work through the In-Work Progression Commission, which is due to report over the summer, that the Department will look at the results of very closely. We also take a very proactive approach to progression through our Jobcentre Plus network. We have increased the number of work coaches in our network by an additional 13,500. Yes, the focus is of course about supporting people on benefits and supporting and empowering people into work, but it is also about supporting people to progress in work. It is very much an A, B and C approach. It is a job, a better job and then a career.
Can I bring Donna in, who is our expert in this area?
Donna Ward: Ruby MacGregor-Smith will be publishing her independent review on in-work progression for the Department, which will be really interesting. There are a number of issues both inside the benefit system and outside of it that makes progression hard for low-income families. The Government have been trying to tackle those over time. For example, being in work is the first step but then incentives to progress in work when your benefits are being taken away are always an age-old problem in every benefit system, which is why the Government have increased the UC work allowance and reduced the taper. Obviously, there is further that we could go over time on all of those things.
Ruby will point to other issues outside of the Department, whether that is childcare or transport, and also how employers treat low-paid workers, their business models, and opportunities to progress in low-paid sectors. It is a big set of issues there, but we do recognise that the next big challenge after getting people in work is how you get them to find full-time work beneficial and worthwhile, given the incentives.
Q192 Steve McCabe: I noticed that the Minister referred to people being in full-time work, and we have heard from you there about progression. In the 2016 Welfare Reform Act you were much more explicit that it was worklessness that was the problem. Now we know two-thirds of people in poverty are in households where people work, so it does not suggest that is quite the problem. Are you now acknowledging that low pay and insecure hours are a major part of the problem and, as Baroness Stroud said, the best defence against poverty is to grow up in a family where both parents are in full-time work? Is that now the Government’s aim?
Will Quince: We certainly want to support, wherever possible, people into full-time because we know—
Steve McCabe: Both parents?
Will Quince: Wherever possible, and that is why we are supporting people with our childcare offer, for example, a comprehensive childcare offer, not just through DfE but also through Universal Credit, and other measures like, for example, the national living wage and the increases thereof, taking people out of tax via the minimum tax threshold example.
So, yes, there is no question that low paid and insecure work is part of the problem, and we are looking to tackle those. That is in part why I am very keen, and I know the Minister for Employment is very keen to see the results of the In-Work Progression Commission’s findings, which will report over the summer.
Q193 Steve McCabe: Thank you. Can I ask about the ONS report last February, which said that there is a clear pathway from childhood poverty to reduced employment opportunities? Does that not suggest that you need to intervene at an earlier stage in a person’s life if you are going to arrest the impact of poverty?
Will Quince: That is absolutely right. When I look within the Department—although I have responsibility for poverty and the publication of the HBAI stats annually, I have within my portfolio and across this Department two levers. My levers are to increase benefits and the support by the welfare safety net, or they are to support people into work. I think we do a rather good job there. We spend over £100 billion a year supporting those of working age, and through our network of Jobcentre Plus up and down the country, we do a good job of supporting and empowering people into work and then progressing into better work too.
But the problem that you have correctly identified is about cause or symptom. We are very much dealing with the symptoms, but what we want to do, and the work that we are doing behind the scenes across Government is about looking to tackle some of the causes of poverty, which, as you rightly identify, often happen many, many years before someone arrives at the Department for Work and Pensions or at a jobcentre. That can be things like, for example, poor quality and unaffordable housing. It can be relationship breakdown, it can be health inequality, cost of living, debt, addiction, substance misuse, educational attainment, as you rightly point out, and it can even be down to things like geographical disparity around things like transport and geographical inequality. Donna, would you like to say any more?
Donna Ward: Yes, I did read the ONS report. It was really, really interesting. Of course, there is a huge link between poverty and educational attainment. That is why in 2017 we published the new measures of root causes of poverty, educational attainment and the gap between FSM children and others, the end of secondary school and the statutory measures alongside worklessness. So, there is definitely a link between people being on free school meals and doing well in the education system. As the ONS report pointed out, there is quite a lot of variation within free school meals.
Q194 Steve McCabe: If there is definitely a link and the Government definitely recognise it, why do we have such torturous arguments in Government about access to free school meals? It would be an obvious thing for the Government to address.
Will Quince: I am not sure we do. We had debates—
Q195 Steve McCabe: With respect, Minister, no one would say that over the past year there have not been torturous arguments in this country and with this Government about the provision of free school meals. You are not telling me that is not the case?
Will Quince: Let’s just be clear on that. There were never debates about the provision of free school meals and, in fact, this Government have increased eligibility for free school meals. The debate was about whether we would provide free school meal provision, or provision and support for those eligible for free school meals, over the holiday periods when they were not in school, incidentally something no Government prior to this one has ever done or countenanced before, yet we have continually done, both with free school meal provision in terms of vouchers, the Covid winter grant scheme and the Covid local grant scheme. I am pleaded to say a scheme that we have just announced we are increasing by £160 million and will now run through until September.
Q196 Neil Coyle: Minister, if there were no torturous arguments, why were you whipped to vote against school meal provision during the holidays, only then to provide school meal provision?
Will Quince: Let’s be clear, it was not school meal provision over the holidays, it was about whether we provide vouchers or support over the period, which the Government have consistently done throughout the pandemic. That is over and above the circa £7.5 billion that we have put in place through our welfare safety net and the Department for Work and Pensions to support some of the poorest, lowest-paid and most vulnerable across our country throughout the Covid-19 pandemic.
Q197 Steve McCabe: Minister, let me ask one last quick, simple question. I am aware of the reports that the Department produces, households below average income stats in the Improving Lives: Helping Workless Families indicators. Do you collect data on job types, hours worked per household and pay received per household, so that we could begin to map this issue of worklessness and the connection between poor pay and insecure hours?
Will Quince: I am not clear on the granularity of the detail and whether we go into all of that. I will hand over to Donna or Elaine, who will be able to confirm.
Donna Ward: With the Family Resources Survey itself we do know a lot about people’s jobs and what they get paid. We also have the Labour Force Survey, which is much more detailed in that respect, but the Family Resources Survey does ask people about the jobs that they do and their hourly earnings as well as total income so that we can get an insight into both of those things. As I say, we can also look at low earners in the Labour Force Survey, which is also a big survey that is devoted just to labour market issues. We can get more detail on some of these issues from that. We do have quite a lot of rich data on which people are trapped in lower-paid jobs and lower-paid sectors.
Q198 Debbie Abrahams: Thank you, and good morning, everyone. I was the Shadow Minister who took the 2015 and 2016 Welfare Reform and Work Act through Parliament. At the time I remember the objections that were made in terms of there not being the methodological tools to be able to analyse the disproportional impact on different population groups. Since then, the Institute of Fiscal Studies and the Equality and Human Rights Commission have very kindly made available tools to the Department for Work and Pensions. They themselves have identified the disproportional loss of income to low-income households from social security and tax changes.
The IFS identified that the poorest 10% were losing 11% of their income. For those with children it would be 20% of their income. That is about £4,000 a year. The EHRC showed that disabled people would be most disadvantaged, with a household with one disabled adult and a disabled child losing £3 in every £10, or £6,500 a year. The EHRC and the Joseph Rowntree Foundation revealed that the loss of income from social security cuts would result in additional poverty and that it was the social security cuts that were the key determinants of the increase in poverty, stating that social security no longer plays a role in protecting people from poverty or destitution.
Given this Government’s commitment to levelling up, will you now be undertaking such analysis of your social security policies on the poverty experienced by our citizens?
Will Quince: As you know, there have been significant welfare changes since 2010. You referenced families with disabilities. This is the remit of the Minister for Disabled People, and he is the expert in this field and not me, but we spend over £57 billion a year on benefits to support disabled people and people with health conditions.
Q199 Debbie Abrahams: With respect, Minister, I did not include the OBR response. This is from the OBR and from the Resolution Foundation. You have cut £33 billion since 2010. I was referring specifically to the 2016 Welfare Reform and Work Act, which is the question that we are currently on. Your Government have cut £33 billion in working-age support, which includes to disabled people. Those are massive cuts. I know you keep going on about what you have done around Universal Credit. When you look at the increase over the last year, it does not make up for that £33 billion cut, does it?
Will Quince: The first thing to say is I do not recognise those figures. Over the course of the past year, we have spent over £112 billion on benefits supporting those of working age. In an average year at the moment, steady state, it is well in excess of £100 billion. That is about £1 in every £8 that the Government spent. It is only a little bit shy of the entire NHS budget. As I said, we spend over £57 billion a year supporting disabled people and people with health conditions through the benefit system. That is around 2.6% of our GDP.
Debbie Abrahams: You have cut £3 in every £10, £3 in every £10.
Will Quince: We can get into—possibly, Chair, on another occasion—the reasons why difficult decisions had to be taken following the record of the previous Labour Government. I do not think that this is the right place or forum to do that. There is no question that difficult choices have had to be made. The important thing to stress is we spend in excess of £100 billion a year supporting those of working age through our benefit system.
Q200 Debbie Abrahams: It is a question, Minister, of the type of decisions you are making, the choices that you are making. These are political choices. It was your political choice to cut support to disabled families, resulting in poverty. If you look at the EHRC—the OBR, the Government’s own OBR was saying that you have cut disproportionately to those families. You cannot dispute these facts, as much as you would like to.
Can I move on, since we are not able to agree on that particular point, although it would be useful if you could write to the Committee to show there are the methodological tools now to be able to do this analysis, whether you intend to do them, if you are committed to levelling up?
We also know that international-level evidence shows that changes in social security policies have significant effects on mental health and health inequalities across different population groups. This Committee heard about the psychological distress—this is causal evidence, review-level evidence—directly caused by the Universal Credit application and claim process. There is also review-level evidence on a 10% increased risk of mental health illness associated with the benefit cap and an increase in antidepressant prescribing associated with communities with less resilient labour markets.
On top of this, I want to make you aware, Minister—which I am sure you are because we are focusing on child poverty—that there is again causal evidence that every 1% increase in child poverty was associated with an extra six infant deaths. That is babies under a year old. An extra six per 100,000 will die because of the poverty that they and their families experience. What we also know from this research, and this was presented to the Committee, is that this is disproportionately affected.
You will be aware, Minister, of Professor Sir Michael Marmot’s Covid review last December. He made a number of specific recommendations, including recommendations around social security, which, when I put them to the Prime Minister, he said he would be supporting. In those recommendations specifically on social security, there is one about a minimum income standard for healthy living. When will these recommendations, which the Prime Minister has said that he supports, be implemented?
Will Quince: There is a broad suite of questions in there. If I start in reverse—
Debbie Abrahams: There was one question and lots of evidence.
Will Quince: So your question is specifically about the minimum income standard? Okay. I will answer the minimum income standard question specifically. While it is, without question, an interesting contribution to the landscape on living standards, the minimum income standard measures the type of goods that a typical family may need to meet a decent standard of living. What it is not is a poverty measure. The Joseph Rowntree Foundation has made that clear in its most recent report.
The minimum income standard includes items that most people would not consider necessities, I would suggest, like, for example, Netflix, jewellery, and wine. The cash value of the minimum income standard is typically higher than the poverty thresholds. For certain families, for example, the minimum income standard may be quite close to median income. For example, in the most recent published report, it suggests that the minimum income standard set out for lone parents with two children was at 84% of the median income. Hopefully, that gives you some context about why this is not something we should be exploring further. More broadly about your general points if I may—
Q201 Debbie Abrahams: Minister, can I interrupt? I was not referring to the minimum income standard, I was referring to the minimum income for healthy living, which is what was recommended by Professor Sir Michael Marmot, and which the Prime Minister committed to. He committed to adopting the recommendations, in a response to me, in the Chamber, as far as the Covid review. That is what I was asking. Are you saying you are not familiar with the minimum income for healthy living?
Will Quince: Yes, I was not in the Chamber for the response that the Prime Minister gave to you. What I will gladly do is take this away, look at what the Prime Minister said and then I will write to you on this subject.
Debbie Abrahams: Thank you.
Q202 Chris Stephens: The evidence we have received shows that children from some ethnic minority families are much more likely to experience child poverty and were more likely to experience deep and persistent poverty. What does the Department’s evidence tell us about why that is the case?
Will Quince: Specifically relating to ethnicity?
Chris Stephens: Yes.
Will Quince: You are absolutely right to suggest that the Family Resources Survey collects data about the ethnicity of respondents. The challenge that we have is that the sample size of the Family Resources Survey as it stands is currently too small to accurately estimate, or to give us accurate estimates, on poverty for some of the smaller subgroups in a single year. That includes certain ethnicities. Instead, the only option we have, until the survey sample size is increased, must be to analyse using three years’ worth of data.
To tackle this, we are working with the Office for National Statistics, which we have discussed, to increase the sample size to 45,000 households from 2022. That will depend largely on how quickly we can return to face-to-face interviews following the Covid safe working practices. Donna, would you like to come in.
Donna Ward: It is absolutely right that ethnic minority families are much more likely to be in poverty, and some of the reasons why. First, it is associated with a big employment gap between ethnic minorities and the white population. There are two main drivers of that. First is ethnic minority women being far less likely to be in the labour market, and second is a real gap among young people as well. Those are two things that we are looking at in the labour market space. There is also a link with a greater likelihood of having a disabled person in the family and also of having larger families. So, it is definitely something that we are aware of and have done analysis of. Some of it is in the labour market and some of it is about family structure and disability.
Q203 Chris Stephens: It is also more likely in families with no recourse to public funds. I also want to ask a question, Minister. The list of social factors, such as lower divorce rate and alcohol consumption are considered overall positive indicators for white families. To what extent does that assume, maybe wrongly, that those traits indicate a lower likelihood of poverty in, for example, a Bangladeshi or a similar family?
Will Quince: That is a fair question. I will hand over to Donna, who is the expert.
Donna Ward: I am sorry, I struggled to hear that.
Will Quince: Mr Stephens, you were asking about alcohol and drug dependency?
Chris Stephens: And lower divorce rates as well and how that is seen as a positive indicator for white families.
Will Quince: But not those, for example, of Bangladeshi or Pakistani origin?
Chris Stephens: Yes.
Donna Ward: There is evidence that drug and alcohol addiction is associated with deprivation for white families and that is one of the reasons that it is one of our nine indicators. But there are quite different drivers among all families across different ethnicities. The same story is not there for ethnic minorities, as far as we can tell with the data that we have. It is quite a big and diverse population of people in poverty and there are distinct and different drivers for different routes.
Q204 Chris Stephens: Thanks. Minister, will the changes you have made to the Family Resources Survey improve the analysis of child poverty by ethnic group?
Will Quince: The answer to that is yes, on the basis that we will have a doubled survey sample size. Elaine, do you want to come in on that one?
Elaine Squires: Yes, at the moment we have to look across three-year averages. Yes, doubling the sample size will obviously help with lots of the subgroup analysis, including ethnicity.
Q205 Chris Stephens: What other parameters are we looking at to be introducing to the survey to help get a better picture?
Will Quince: Particularly relating to ethnicity?
Chris Stephens: Yes.
Will Quince: Elaine, do you have any intel on that? Specifically relating to ethnicity, are there any other questions or data that we are likely to be able to get from the FRS with the increased sample size? I think that was the question.
Elaine Squires: Other than increasing the sample size—that is obviously going to help around subgroup analysis for different ethnic groups—we are not adding anything additional that is going to help around ethnicity, it is mainly going to be doubling the sample size and it increases the power of the analysis that we will be able to do.
Q206 Chris Stephens: And are you looking at individuals with no recourse to public funds and that being a reason for people, particularly those from an ethnic background, being in poverty?
Donna Ward: We are picking up very, very few of them in the data. We are literally only going to interview 20,000 households at the moment, so our data pick up very, very few families with no recourse to public funds. Even with the increased sample size that will be difficult, not least because of the way that the survey goes door to door to households on a random sample. The DWP’s poverty statistics probably will not help in that regard. The Home Office collects statistics from families with no recourse to public funds, but we genuinely have little information on those families because they do not enter the benefit system.
Chris Stephens: Thanks. That is something we can pick up on.
Chair: Thank you. Steve McCabe wanted to raise a particular point as well. Steve, have you had an answer, or do you want to come back on that?
Q207 Steve McCabe: I have just heard that the DWP does not collect data on this, so there is not much we can do about that. I noticed the Children’s Society said: “Thousands of children in the UK are facing deep, long-term poverty because of strict immigration rules, which mean their families cannot access mainstream benefits”. How do you feel about that, Minister, given that you are concerned about children in poverty in general? How do you feel about the fact that there are thousands of children facing deep, long-term poverty and your Department cannot do anything about it and the Home Office does not seem to share its data with you?
Will Quince: Any child in poverty in this country is of course deeply regrettable. Where you are absolutely right is that access to DWP income-related benefits such as UC flows from an individual’s immigration status. I am meeting the Chairman of the Committee relatively soon to discuss this in a bit more detail, hopefully alongside the Immigration Minister. The important thing to stress is that the DWP has no legal powers to award taxpayer-funded benefits to an individual whose Home Office status specifies no recourse to public funds.
There is one important thing to stress, though. That is that migrants with leave under the family and human rights routes can apply to have their no recourse to public funds condition lifted, by making a change of conditions application if they are destitute or at risk of destitution and if the welfare of their child is at risk due to their low income or where there are other exceptional financial circumstances.
It is also important to stress that local authorities often also provide a basic safety-net support, regardless of immigration status, if it is established that there is a genuine care need that does not arise solely from destitution, where, for example, there is a community care need or migrants with serious health problems or family cases where the wellbeing of a child is in question.
For example, the Covid local support grant was at the discretion of local authorities, and we deliberately did not make it overly prescriptive because the legal premises that we had to work were looser than those that we currently have in relation to UC and the wider benefit system.
Q208 Steve McCabe: Local authorities also complain about cost shunting from central Government, do they not, over this very issue? I am right to say that there are thousands of children living in deep poverty because your Department is not responsible for them, and when you have a meeting the Immigration Minister may or may or may not be present—that is a reasonable thing for me to suggest and it is something that someone in Government should probably look at. Would you agree with that?
Will Quince: It is an assumption on your part because what we do not have is the data. I have not seen any data to suggest how many families with children who have no recourse to public funds are in that position. The other thing that I forgot to mention, which is also important, is that those with no recourse to public funds can claim or may be able to claim contributions-based benefits like new Jobseeker’s Allowance, providing that they meet eligibility criteria. There are options other than Universal Credit.
Steve McCabe: I will leave my bit there, Chair, thank you.
Q209 Nigel Mills: Can I start, Minister, by asking if you have any update for us on what might happen to the £20 uplift in Universal Credit? We are halfway through the six-month extension. Are you expecting an increase or is it too early to tell yet?
Will Quince: Thank you, Mr Mills, for the question. The £20 Universal Credit uplift was intended to be, as you know, a temporary measure brought in, due to Covid-19, to support those facing the most financial disruption during the pandemic. Due in a large part to the success of the vaccine rollout, we are now in a position to pivot back to supporting and empowering people back into work and to progress in work.
It is important to stress that this Government is wholly committed to supporting those on low incomes, including by increasing the living wage, by spending, as I have said, an estimated £100 billion on welfare support for those of working age this financial year. This included around £7.4 billion of additional support through the welfare safety net or welfare policy measures. We have also introduced the Covid winter grant and now the new Covid local grant scheme to help and support the most vulnerable children and families to stay warm and well fed throughout the holidays. That is being extended until September, at a cost of an additional £160 million.
In answer to your question, as the economy recovers, our ambition is to help people move into and progress in work as quickly as possible, based on the clear evidence around the importance of employment, and particularly where it is full time, in substantially reducing the risk of poverty. That is why we are investing £30 billion in our ambitious plan for jobs and those additional 13,500 work coaches in our Jobcentre Plus network up and down the country to support and empower people back into work.
It is important to stress that that plan for jobs, whether it is Kickstart or Restart and many of these other schemes that brick up to make the plan for jobs, is already delivering for people of all ages right across this country.
Nigel Mills: I am trying to work out what you are telling me there.
Will Quince: I am telling you, Mr Mills, as the Chancellor of the Exchequer has made it pretty clear, that as things stand there is no intention to extend the £20 Universal Credit uplift further. The plan is to tack, if you like, and to move our focus into supporting and empowering people into work as our labour market opens up and as restrictions are eased through the roadmap.
Q210 Nigel Mills: That is a view the Department shares, is it? You are content with the Chancellor’s approach? There is no argument you are going to take up with the Chancellor for another six months.
Will Quince: I do not think it is ever a wise move to argue with the Chancellor of the Exchequer, but that is the position of Her Majesty’s Government.
Q211 Nigel Mills: But you are not making submissions for that. The evidence that we heard earlier was that the administrative data you use to monitor that was used to support the six-month extension. Is that data you can analyse now, showing that the £20 uplift is not needed any more and you can see there are more earnings in the system and people are better off and therefore the data no longer support it or do the data look unchanged from before the end of March?
Will Quince: I will bring Donna or Elaine in in a moment, but I would stress that the £20 uplift was brought in to support those facing the most financial disruption during the course of the pandemic, who were facing a huge economic shock, largely those who had lost their jobs entirely or had seen a significant drop in income, many of whom were interacting with our benefit system for the first time.
There is no question the past year and a half has been the most difficult period for so many people. That is exactly why we put in place unprecedented welfare support of that additional £7.5 billion, for which the Chancellor of the Exchequer and the Prime Minister deserve huge credit, supporting the poorest, lowest paid and most vulnerable in our society. But I do not think anyone could argue that the circumstances now are considerably different, in that we have seen significant lifting of restrictions, our labour market is opening up, our economy is opening. Furthermore, our economy will hopefully be going great guns towards the end of the summer and into the early autumn. We are in a different place and that is where we renew our focus on supporting and empowering people back into work. It is a shift in our approach.
Donna, do you want to come in and add anything to that?
Donna Ward: Yes, on the admin data specifically we were able to show how much the caseload had increased and how quickly, which, as the Minister said, indicated how many people had suffered an unexpected economic shock and what that had done to their incomes. Most of the claimants on Universal Credit who benefited from the £20 uplift were not in benefits before, so it is very much around an economic shock response.
We used that data to make the argument that people were not expecting this, they had a sudden drop in their income, and we looked at how long the situation might last and various labour market forecasts and so on. Yes, given that legacy benefits are not included in the £20 uplift, it was very much around the people who had a change of circumstances or lost their jobs altogether and came to Universal Credit for the first time. It was difficult for people to adjust their costs over Covid, and they were landed in that situation.
Q212 Nigel Mills: That was the position in March when you justified the six-month extension. That has changed now, has it?
Will Quince: We have to remember that throughout that period and even today we still have restrictions in place that are somewhat limiting our economic bounce-back. Although there has been a short delay to the roadmap, the economy is largely opening up. We are seeing an increase month on month in vacancies and people getting into work. So, it is right, as the restrictions are eased and the economy is opening up, that we shift our focus to the planning for jobs and supporting and empowering people into work.
Q213 Nigel Mills: I accept all that, Minister, but in the earlier questions on how we get quicker real-time data on who is in poverty and what the impacts are, one of the answers was that the administrative data for UC were used to justify the six-month extension to the £20 a week uplift. I am asking whether that data, which I presume you are running on a regular basis, are now showing there has been a change and that the people who were newly on benefits and were still there in March are now finding work and are not having the same struggles that they had three months ago, or whether this is a hope expectation forecast that they will not be there in September, and that is the change. I am simply asking, if you reran the data that you used in March, would it show you a different picture now or not?
Donna Ward: There have been large numbers of people flowing off every month, but we do expect that to accelerate over the next few months. The level of economic uncertainty is huge, as you know, so it is obviously all aligned with lockdown restrictions lifting and the economy going back to normal, but it is hard to see that perfectly in the data right now.
Will Quince: That is the point, is it not? When you look at the impact of any individual policy, it is complex and it is inherently speculative, so it is somewhat difficult to predict.
Q214 Nigel Mills: You have decided right now that we are not extending the uplift and you are hoping that the data will support you when we get around to it.
Will Quince: I do not think that is a far characterisation of what I said. What I said—and maybe you will look back at the transcript and I perhaps was not clear—is that the position of Her Majesty’s Government, as it stands at the moment, is that the uplift is due to come to an end. As I have said throughout this and as the Chancellor and the Prime Minister have said throughout this, if the facts change then we would look to change our position.
As it stands at the moment, thanks to the incredible success of the vaccine rollout, the labour market opening up, our economy getting going again and more and more people moving back into work, we should renew our focus on supporting and empowering people back into work. But if the circumstances were to change, of course the Chancellor would keep all options on the table, as he has done throughout this pandemic, to support the poorest and most vulnerable in our society. We are still a few months out from the uplift coming to an end.
Q215 Nigel Mills: I think what you are saying is that if the number still on the UC who were new claimants during the pandemic is still above a certain level, then you would think you should keep the uplift from the end of September. Is the circumstance changing or not changing the measure you would use to decide whether to make that request to the Treasury to carry on?
Will Quince: What I am not going to do is speculate on that at the moment. This is not a low-cost measure. The cost of this measure is about £6 billion a year. Accordingly, it is right that our focus is on supporting and empowering people back into work. Ultimately this would be a decision for the Secretary of State, for the Chancellor of the Exchequer and the Prime Minister, but the position of Her Majesty’s Government as it stands today is that the uplift is due to end.
Q216 Nigel Mills: You do not have an internal target or something, where if that number of claimants has not gone below a certain level, then you will think you do need to keep the uplift? Even though that seems to be what the measure was that was used for March, you do not have a target, or at least not one you will share with us now?
Will Quince: As with most policy formation and discussion, it is not appropriate that I go into any detail about what the Department may or may not be thinking in terms of future fiscal events.
Q217 Nigel Mills: One more question. We heard the data earlier that 45% of claimants of UC claimed to be in a food-insecure position. Are you still confident that the rate of UC without the uplift provides claimants enough money to live on? That is the Department’s strong position, is it?
Will Quince: We keep that under close review. Do not forget that the standard allowance is just one part of many people’s Universal Credit claim. There are often additional elements too.
If you look at the some of the broader challenges around cost of living—and this is why I come back to the points that I was making earlier. Yes, we can talk about benefits and whether it is right to increase benefits, but what we should be looking at is what the drivers are that would suggest that people are in food insecurity. For example, that may well be—and I would suggest the Committee may want to look into this in a bit more details—about housing costs. If we know that around half of those on Universal Credit are in effect topping up their housing costs, is that an issue of benefit adequacy or is it an issue of housing supply versus demand in particular areas?
I understand why you are asking the question and we should rightly look at whether the support we provide for people is sufficient to meet their costs of living. But we also have to look at some of those root causes and drivers. This exactly why I am working across government, with other Government Departments and Ministers and counterparts in those Departments to try to address some of those medium to long-term challenges that are making it harder for those in receipt of benefits around cost of living. That is work that my Secretary of State is leading.
Q218 Dr Ben Spencer: My question is on targets, strategy, and cross-governmental working, but I want to start off by coming back to definitions and some of the questions that Shaun was asking earlier. This is a critical part of the work that we are trying to do. In a sense, poverty, as I understand it, can be split into two ways of thinking about it. It is a very human concept that we are defining. One is the arbitrary: what is poverty? The other is poverty as defined by some sort of measure or how we are collecting in on this.
In a sense, how that then moves in terms of how you are defining and measuring poverty leads to that conversation. I notice that a lot of our evidence that we have had in this inquiry is people switch, in terms of witnesses, when they are talking about poverty as an arbitrary concept versus poverty as defined by measure. I get very, very confused about how the debate is going forwards. It is critical because it changes how we think about poverty and how we define it in terms of what we are trying to fix.
I apologise for that mini speech, but my first question is what does poverty mean to you, Minister, in terms of that arbitrary concept? What do you think poverty means and what do you think the public mean when they talk about poverty and how does that relate to the measures of poverty that we are collecting, or proposed measures?
Will Quince: Thank you very much. That is an incredibly good question because at the moment there is a massive disconnect between many of the poverty figures and measures and what the public perceive to be poverty and not poverty. There are some perverse statistical outcomes. If you go by relative poverty in a recession or during a pandemic, people could be considerably poorer, yet fewer people would be in relative poverty, which most people would not understand.
This is why I come back to the British Social Attitudes Survey, which found that 28% of the public see not having enough to buy the things that most people take for granted as poverty, but 90% of people see poverty as struggling to afford the essentials, for example those cost-of-living elements like energy, food, transport, without getting into debt. It is extremely hard, and I do not think internationally anyone has found one definitive measure or stat that the public would buy into or that statisticians can agree is the right measurement of poverty. That is why it is important that we have a suite of measures.
A lot of work we do is around persistent poverty and material deprivation, which does look at some of the things like what can somebody afford over the course of a year. For me that is indicative. For example, can you buy a winter coat for your children? That will not show up in many of the poverty statistics. Some of the poverty statistics, for example, talk about housing but they do not talk about childcare. Childcare is often the second biggest cost only to someone’s mortgage or rent every month.
That is exactly why we are looking at detail in other poverty measures. That includes looking at the SMC measure too but accepting that there is no perfect one and it is largely going to be a suite of different measurements. That is why, even if we do produce a new measure—and I hope that we will—we will still continue to publish the other stats alongside it as part of the HBAI releases.
I think Governments and Oppositions and charities will always to some extent cherry-pick the stat that best fits their narrative. But as long as you are publishing a suite that paints a picture that the public and the Government and stakeholders and others can get a sense of where we are in terms of broader poverty and child poverty, it means that you can start as a Government and wider society to accept where you have the challenges and then to put in plan the measures that you plan and the measures that you need to start tackling it. Donna, do you want to add anything to that?
Donna Ward: No, that is quite comprehensive. Having looked at who is included and excluded from the different measures, the low income and material deprivation or the persistent poverty measures narrows in on those people who are in that position for the long haul. That is where the top priority focus from Government should go.
Q219 Dr Ben Spencer: Thank you. One of the witnesses who spoke to us spoke about the Mexican approach. What they had done is said politicians essentially worked through what are key areas of change that they think need to happen—a list of things like access to education, healthcare, access to food, quality of housing and public amenities, saying that these are the things that are really important, and these are the things that we need to change—and then linked that into their poverty measure.
Is the Department doing that work? Is it talking with other Departments, what are the things it wants to shift, and how that could be brought into a measure? Do you share my worry that purely focusing on financial measures of poverty are too narrow an approach and do not look at anything in the round in terms of the big picture?
Will Quince: I think that is right, and the Mexican approach does have considerable merit. It was before my time, but I understand that was exactly why we moved in 2016 to the Improving Lives indicators, which do cover worklessness, parental conflict, mental health, drug and alcohol dependency, homelessness, early years support, youth employment, educational attainment, and debt.
It is important to focus on that because, as you rightly suggest, no one Government Department could possibly look to tackle poverty or child poverty alone. It requires every Government Department to work across government to see what they can do. That is why we have the costs of living taskforce, which is chaired by Secretary of State, bringing all Ministers across government together to look at how we can reduce the cost of living, how we can tackle some of these root causes of poverty that persist and, to be frank with you, to prevent people appearing at the door of the DWP in five, 10, 15 years’ time.
Q220 Selaine Saxby: We have heard from witnesses, including the Children’s Commissioner for England, who have referred to significant cuts to the family support infrastructure provided locally. Do you agree with that assessment and what steps are the Government taking to ensure that there is wider family support in place to address child poverty?
Will Quince: I apologise, I did not see that evidence. I will turn to Donna in a moment, who can talk about some of the work that we are doing across government in that field. Whether it is things like the troubled families programme, whether it is the work we are doing in families’ hubs, the new work being led by Andrea Leadsom as part of her taskforce on early years, and of course the work via the Department for Education, there is a huge amount going on in this space, not to mention the work that we are doing in our Department around reducing parental conflict and around the children maintenance service.
I will hand over to Donna who will be able to talk about some of these measures in more detail.
Donna Ward: The evidence it that there is quite a lot of money spent by local authorities on family support and central Government are doing a fair bit as well, as the Minister said, around reducing parental conflict, running the children maintenance services and so on. The real missing piece is joining up those services and making them accessible for families. I am not saying that there are not any missing services or funding problems. That is where the Department for Education’s idea on family hubs comes in.
The key focus at the moment for the Government around family policy is joining up and improving what is there for families and then looking into the spending review to see where enhancements could be made. We were working with DfE on family hub policy and how access to child maintenance services and reducing parental conflict could then be facilitated for families through that. So, there is work on that side.
Q221 Selaine Saxby: Do you think the pandemic makes the need for a comprehensive child poverty strategy more pressing?
Will Quince: We are already doing a lot of that work across government in any event. The work that we are doing with other Government Departments around tackling the cost of living and tackling some of those root causes of poverty are largely doing that work. That is led by our Secretary of State and has the full backing of Cabinet Office and Treasury and of course No. 10.
Chair: Thank you. Siobhan Baillie. I understand that Siobhan has lost connection, so we have a technical issue.
Neil Coyle: I had a supplementary to an earlier question, Chair, if I may, while we wait.
Q222 Chair: I will come to you in a moment, Neil. I will put the question that Siobhan was planning to ask.
Minister, you will have seen and be aware of the Independent Review of Children’s Social Care that was published recently. That said: “The weight of evidence showing a contributory causal relationship between income, maltreatment and state intervention in family life is strong enough to warrant widespread acceptance”. They go on to call for: “Strategic direction and coordinated central government policy” targeting children and families. What is the Department’s response to that call from the Independent Review of Children’s Social Care?
Will Quince: What I would say to that—I think we have Siobhan back with us—is that the Departments are working closely together to deliver a number of key cross-cutting outcomes linked to spending review 2020. These outcomes include addressing poverty through enabling progression into work, for example, reducing the cost-of-living pressures and, importantly, increasing financial resilience. We are leading this work in collaboration with other Government Departments, including Treasury, DfE, MHCLG and DEFRA. All I can say is we are committed to developing and delivering longer-term sustainable solutions to reduce poverty, including child poverty.
We recognise that this provides and in fact necessitates a holistic approach that goes beyond our Department’s remits, as I touched on before. Local authorities and services are very often best placed to identify and act on local need. That is why we will continue to include them and work very closely with them in our thinking.
Chair: Thank you. Siobhan, I am sorry we lost you there. Did you want to come back on that?
Siobhan Baillie: No, that has covered it. It would be good to have confidence that the third sector and the people on the ground are integral to the Department’s work and thinking, because they do know who needs help. I am conscious of time and apologise for my internet.
Chair: Thank you very much. Neil, you had a further point that you wanted to raise, which will be our last question this morning.
Q223 Neil Coyle: Thanks, Chair. It links to that last point about the need for social services and local authorities to be working with the Government or the Government to work the other way. Linked to the no-recourse question, I have supported a family in my constituency where the father was working, and they have three children born in this country. Due to Home Office delays, he lost his job and then visa renewal and then they had no recourse imposed. They went from rent in the private sector to wholly relying on emergency social service provision at colossal cost to the council.
This is a family forced into a poverty as a result of Government policy, with absolutely no chance that they will leave this country, because the three children were born here. As things stand from the discussion this morning, Minister, you have told us that not only does this family not get measured in Government statistics but under current proposals they will not be measured. How can you possibly fix poverty for a family like that, with British-born children, if you fail to identify them and consider their circumstances?
Will Quince: With respect, I did not say that at all. I said that we only interact with people who engage with the benefit system. Because of the legal limitations, those with no recourse to public funds are not able to claim Universal Credit. Some will be able to claim on a contributory basis, but—
Q224 Neil Coyle: Minister, how will you fix that? You are saying you do not see them.
Will Quince: No, what I am saying is—you said the Government do not. The DWP is not the Government. We are one Department inside the Government. The Home Office will no doubt have data on those who have no recourse to public funds.
I recognise that there is an issue here. I have been speaking at length this week to the Chair of the Select Committee and I am due to meet with him soon to discuss this further. Ultimately, this is a lever that I do not hold. It sits with the Home Office. As a result, I am looking forward to meeting with the Chair of this Committee and I hope the Immigration Minister to discuss what more we can do. I rightly recognise the situation that you painted with one of your constituents is one that is deeply regrettable and that we want to avoid wherever possible.
Neil Coyle: The Prime Minister said that that figure would be shared about the number of families with no recourse restrictions. You think you are going to be more influential over the Home Office than the Prime Minister. Good luck.
Chair: Thank you, Neil. Thank you, Minister, very much indeed for your evidence to us this morning, and thanks to your colleagues as well for being with us. You have given us very full answers to all the questions that we have raised.
That concludes our questioning and brings our meeting and indeed this inquiry to an end. Thank you all very much indeed.