Session 1: Child poverty outcomes and main factors behind International benchmarking and key challenges for Member States András Gábos TARKI Social Research Institute Child poverty and child well-being: better monitoring for better policies Brussels, 26 November 2009

International benchmarking and key challenges for each Member State To assess the performance of countries in the field of child poverty (and well-being) relative to The national average/adult population The EU-average Four dimesions: 1 on outcome side and 3 on determinant side Child poverty risk outcomes Joblessness In-work poverty Impact of social transfers Other aspects (material deprivarion, housing, non- material well-being) are also dealt with in the Study

Poverty among children, in general, is higher than that of the overall population Every fifth child is at-risk- of-poverty in the EU-27 Child poverty is specifically high in the two newest MS: BG and RO Much higher than the population average: CZ, HU Lower than the population average in: DK, DE, EE, CY, SI, FI The severity of poverty is more similar to the population as a whole Relatively high in: BG, RO, Baltic States Relatively low in: FR, CY, FI, SE Positive correlation between extent and severity At-risk-of-poverty rates: overall population and children, EU-27, 2007 Source: EUROSTAT

Persistent poverty tends to be high where the extent of poverty is also high - according to preliminary results At-risk-of-poverty rate lower than the EU-average (by at least 3 pp) At-risk-of-poverty rate around the EU- average At-risk-of-poverty rate higher than the EU- average (by at least 3 pp) At-risk-of-poverty rate lower than the national average DK, DE, CY, SI, FIEE At-risk-of-poverty rate slightly higher than the national average (0-4 pp) BE, FR, NL, AT, SE IE, LV, LT, PTEL, ES, UK At-risk-of-poverty rate higher than the national average (by at least 5 pp) CZ, SKLU, HU, MTIT, PL, BG, RO The risk of poverty of children relative to the national and EU-average, EU-27, 2007 Source: own classification based on EU-SILC 2007

Almost 1 children in 10 in the EU lives in jobless households Reasons for joblessness can be found on both the supply and demand side Lack of or inedaquate human capital of parents Counter-incentives of income supports Shortage of childcare Regional and/or ethnic segregation The risk of poverty among children is inevitably linked to the underlying structure of the households in which they live Children in jobless households are likely to live in lone parent families: BE, EE, IE and the UK Children in large families are affected in HU Share of children (0-17) and adults (18-59 – not students) living in jobless households, EU-27*, 2007 (%) Source: EU LFS *No data avalaible for Sweden

Sensitivity of risk of poverty rate to alternative measures of low work intensity (based on EU-SILC) Source: own calculations based on EU-SILC Note. BG, MT and RO are not included.

Most of children live in households where at least one person is in full-time employment Similar share of children in in-work (WI>=0.50) households across countries Large variation in the risk of poverty High in Southern countries, Baltic States, LU, PL Reasons behind Low wages Not full participation in the labour market Only one parent in employment Part-time work Shortage of childcare Social norms Source: own calculations based on EU-SILC 2007 *No data available for analysis for BG, MT and RO In-work poverty (WI>=0.50) in the European Union*

Children in one-earner households are at four times higher risk than those in two-earner households in the EU High share, high risk: EL, ES, IT Low share, high risk: LV, LT, PL, PT In general, having both parents employed, is the best way of avoiding the risk of poverty Two-earner model: Nordic countries, CY, SI 1+1/2 earner model: NL and at some extent in DE (also SE, AT) Where the incidence of part- time employment of mothers is high, their children face similarly low risk of poverty as their peers in two-earner households do Children in one-earner households (WI=0.50) in the European Union* Source: own calculations based on EU-SILC 2007 *No data available for analysis for BG, MT and RO

Social transfers reduce the proportion of children at risk of poverty by 42% in the EU as a whole The effectiveness of transfers reflects both the scale of expenditure level and the extent of targeting Highest impact in: DK, FI, SE, as well as in DE, FR, HU, AT, SI Lowest: EL, ES, IT Serious limitations of the EU-SILC No behavioural responses are considered No full account of taxes and social contributions No account of transfers via the tax system Hard to identify child- contingent payments Effects are likely to be over- estimated Source: own calculations based on EU-SILC 2007 *No data available for analysis for BG, MT and RO Distribution towards children at-risk-of-poverty and the effectiveness of social transfers (excl. pensions), EU*

Child poverty risk outcomesJoblessness In-work poverty Impact of social transfers Group A FI CY – DK SI SE FR+ + NL++++ AT++ + Relative outcomes of countries related to child poverty risk and main determinants Group A: good performers in all dimensions

Relative outcomes of countries related to child poverty risk and main determinants Child poverty risk outcomesJoblessness In-work poverty Impact of social transfers Group B DE+ – BE+– SK––+– EE––+– CZ––+ + IE–– + + HU–– ++ UK–– – –++ Group B: joblessness is key challenge

Relative outcomes of countries related to child poverty risk and main determinants Child poverty risk outcomesJoblessness In-work poverty Impact of social transfers Group C LV–––– LT– –– Group D PT–+–– LU–+ + +– – EL– + + +– – – – PL– – –+– – ES– +– – – IT– – –+ – – –– Group C: relatively bad performance in all dimensions Group D: in-work poverty is key challenge