Achieving Our Potential?: Tackling Poverty During the Recession January – March 2009

Achieving Our Potential ? Tackling Poverty During the Recession  Introduction  Current trends in poverty – where we have got to, and the challenge ahead  Achieving Our Potential – an adequate response to poverty in Scotland?  Tackling Poverty in Recession – what can be done?

About the Poverty Alliance  A Scotland-wide independent network of groups, organisations and individuals working together to tackle poverty  Focus on working alongside people in poverty to ensure their experience is heard by policy makers  Lobbying and campaigning for change: current focus on living wages, welfare reform and child poverty

Current Trends in Tackling Poverty Where have we got to in the fight against poverty?  Focus on 2 key areas  Income  Out of work poverty  ‘In-work’ poverty  Income Inequality

Incomes: out of work– Key Issues  Inadequacy of out of work incomes  Large decline in pensioner poverty but trend slowing  Decline in child poverty has stopped in Scotland over the last three years and risen in UK  Poverty amongst working age adults without children increased over last 10 years  Now single largest group of poor people. Their welfare benefit values have declined by 20% relative to wages since 1997

Incomes

Incomes out of work

Incomes & In-Work poverty – Key Messages  Rise of ‘in-work’ poverty  50% of children in poverty are in working households  More working age adults in poverty are in work than out of work  Most of increase of ‘in-work’ poverty has been amongst those without dependent children  Labour market ‘churn’ 50% of people making new JSA claim were claiming 6 months before. Same as decade ago  ‘Work first’ approach is failing some groups esp. childless adults

Incomes & In-Work poverty

Income Inequality  The poorest tenth of the population have, around 2% of Scotland's total income, second poorest tenth have 4½%.  The richest tenth have 27% and the second richest tenth have 15%.  Scottish Government's new focus on the bottom 30% (Solidarity Target) should benefit pensioners and lower-income working families.

Income Inequality

Inequality: Bottom 30% Bottom 30%

Achieving Our Potential “The Framework sets out further priorities for action and investment to deliver improvement in four areas” 1.Reducing income inequalities 2.Introducing longer term measures to tackle poverty and the drives of low income 3.Supporting those experiencing poverty or at risk of falling into poverty 4.Making the tax and benefits system work better for Scotland

1. Reducing income inequalities  Maximising the potential for people to work by removing barriers to work including provision of accessible child care financial literacy skills during the transition to work; develop plans for employability for BME communities  Maximising Income for All New income max programme in , Focus on older people and other key groups Additional £7million funding  Do the actions match the rhetoric?

2. Longer term measures to tackle poverty  Providing children with the best start  Supporting broader efforts to deal with health inequalities  Promoting equality and tackling discrimination  Affordable housing  Regenerating disadvantaged communities

3. Supporting those experiencing poverty  Create a fairer local taxation system  Address fuel poverty  Introduce the new Energy Assistance Package for people on low incomes; press UK Government to do more on winter fuel allowance and on social tariffs;  Promote financial inclusion & address stigma

4. Making the Tax and Benefits System Work Better for Scotland  System must be fair, transparent and sympathetic to those in poverty.  Financial benefits of working must be significant and sustainable.  Transitional support must be responsive, quick and effective.  Benefits must provide a standard of living which supports dignity, freedom and social unity.  Administration must be swift, streamlined and customer focused.

1. Reducing Income Inequalities: Making Work Pay Action/PolicyNewExistingPlannedNature of action FundingTimescale Additional investment in ILA XTrainingYesNo Press UK Govt to transfer responsibility for tax and benefits XXLobbyingN.A.No HIE will support rural business and diversification XEconomic development Yes, ongoingNo More action to address low pay in the public sector XResearchNo2009 Campaign to raise awareness of statutory workers rights XAwareness raising Yes

Recession and Poverty: Key Questions  How do we keep the current anti-poverty agenda relevant during the recession?  Does the rhetoric match the reality?  What actions do we need ?

Achieving Our Potential?: Tackling Poverty During the Recession January – March 2009

Assessing Our Potential Key Strengths: Recognition that low income is at the heart of the experience of poverty Understanding that income inequality is problematic in itself, not merely a benign outcome of the market Identifies a range of clear, practical actions that can be delivered by local and national government, and by the voluntary sector Strong on the structural causes of poverty Makes important statements in relation to the way the benefit system should operate

Assessing Our Potential Key Weaknesses:  No recognition of impact of recession  Few new resources  Little recognition of the importance of place  Very weak monitoring and evaluation processes  Too many actions/plans still to be developed  Pick and mix approach to policy development  No timescales for review

Responding to the Recession  The Scale of the Recession in Scotland  Growing view that Scotland will be hit harder than UK  Net job losses of 37,000 in 2009 and 16,000 in 2010  Total job losses could exceed 160,000 in 2009  Both service and manufacturing sectors will be hit

Recession and Poverty: Some areas for action A review of JSA benefit levels as part of ‘fiscal stimulus’ Benefit maximization campaigns coordinated by UK & Scottish Government Revision of the 16 hour rule to enable more people to undertake training whilst receiving benefits Support for apprentices facing redundancy

Recession and Poverty: Some areas for action Moratorium on elements of current welfare reform programme Increased investment into voluntary sector and social economy Increase in the national minimum wage Action to support a living wage in key sectors of the economy