TMP Online

New figures released by the Institute for Public Policy Research reveal the continuing poverty amongst the working poor.  According to the IPPR research more than a million children in Britain are living in poverty despite the fact that at least one of their parents is in work.

Studies show that poverty and child poverty, in particular, disproportionately affect ethnic minorities. The Joseph Rowntree Foundation published research last year which showed that the poverty rate for Britain’s minority ethnic groups stands at 40%, double the 20% found amongst white British people.  The Child Poverty Action Group has also conducted research which shows that children from ethnic minorities are more likely to be living in poverty in Britain than their white counterparts.

The new research from the IPPR released today shows that, although 600,000 children have been lifted out of poverty in the last ten years in the UK, the total number of poor children in working households has stayed the same at 1.4 million. Half of all poor children now live in a working household.

The report argues that lifting these ‘forgotten million’ children out of poverty requires action to tackle high numbers of poor children in working couple families and improve wages at the very bottom of the labour market. Specifically ippr recommends a package of measures to improve work incentives for low income couples and increase financial support through tax credits, along with action to boost the effectiveness of the minimum wage.

Kate Stanley, ippr Head of Social Policy, said:
“Significant progress has been made in the last 10 years in lifting nearly 600,000 children out of poverty. However, half of all poor children now live in households where someone is at work and the challenge is to ensure that work really is a route out of poverty. Tax credits and the minimum wage have ‘made work pay’ relative to being on benefits but these don’t yet go far enough to ensure more children are lifted out of poverty. More action is needed to combine financial support and measures to boost parental employment with action to deliver fairness on pay and opportunities for progression at work.”

One suggestion made in the report is to maintain the value of the minimum wage so that it is at least in line with average earnings growth over an economic cycle and extending the adult rate to 21-year-olds while retaining lower rates for younger workers.  The ippr also recommends:
• building ‘fair wage’ commitments into public sector employment contracts and the £125 billion spent each year by the Government on public procurement;
• the development of a ‘gold standard’ accreditation for employers paying decent wages, linked to wider employment standards;
• ensuring that the new Local Employment Partnerships deliver sustainable, decently paid jobs, with training prospects;
• offering skills and career advice to all low-paid workers in receipt of Working Tax Credit, improving their pay and prospects at work; and
• extending the right to request flexible working to all employees, to help families avoid a negative trade-off between ‘income poverty’ and ‘time poverty’.

The report can be downloaded here.