A quick guide to...the new child poverty figures expected on Tuesday

Next week sees the publication of probably the last set of official child poverty figures - for 2012-13 - before the 2015 general election.

Here’s a quick guide to what we should expect and what it all means.

WHAT, WHERE & WHEN?

  • The official child poverty statistics (‘Households Below Average Income’ (HBAI)) for 2012-13 are due out Tuesday 1st July 2014.
  • The statistics will show the number of children in poverty across a range of measures and the proportion of poor children living in working families.
  • They will be published at 9.30am on the HBAI pages of gov.uk

WHAT DO WE EXPECT?

The Institute for Fiscal Studies, in an analysis produced in January 2014, projects that child poverty will have increased in 2012-13 for at least two of the four statutory measures:

 1. Relative child poverty: the tide is turning, child poverty is starting to rise

  • Relative poverty is probably the best measure of whether ‘we’re all in it together’ that we have - it measures how many children have living standards that fall behind children in average income families.
  • The January 2014 IFS projections suggest relative child poverty in 2012-13 will have increased by 100,000 from 2.3m to 2.4m (a 4% increase). And that the overall trend this decade may be rising child poverty.

 2. Absolute child poverty: living standards of poorest families continue to fall sharply

  • Absolute poverty measures tell us whether more families are facing real changes in income from a fixed point – in other words it shows falling living standards.
  • The January 2014 IFS projections suggest absolute child poverty in 2012-13 will have increased by 300,000 from 2.6m to 2.9m (a 12% increase). This is in addition to the increase of 300,000 that took place in 2011-12.  A 300,000 increase in 2012-13 would mean that absolute child poverty rose by 600,000 in just two years, from 2.3m to 2.9m (a 26% increase).

 WHAT IS THE SIGNIFICANCE OF THESE FIGURES?

The Government seems to be in denial about a looming child poverty crisis – claiming child poverty will fall significantly, when independent experts say it is more likely to rise significantly.  

  • Iain Duncan Smith told BBC R4 Today (26 March 2014) that the Government will succeed in meeting its child poverty targets by 2020.    
  • The Government is therefore claiming that relative poverty will fall from 2.3m to 1.3m (a 43% fall) and absolute poverty from 2.6m to 0.65m (a 75% fall) by 2020.
  • The January 2014 IFS projections suggest relative child poverty will rise from 2.3m to 3.2m by 2020 (a 39% increase) and absolute child poverty from 2.6m to 4.0m (a 54% increase).

It is worth noting that in 2012-13 (the year these new figures will relate to) the coalition was still uprating benefits according to inflation. For the three years after that, starting with 2013-14 and implemented partly through the Welfare Uprating Benefits Act, it intends to make real terms cuts in benefit and tax credit levels by limiting increases to just 1% a year in cash terms. Therefore, the figures for 2013-14 and later years, may show sharper rises in child poverty. But these figures are not expected until after the election.

It’s notable that the Government’s own Child Poverty Strategy published this week contains no milestones, no progress measures nor any assessment on the overall impact of policies on the number of children living in poverty. 

We will have a better idea on Tuesday about whether or not the Government’s approach – which, let’s not forget, includes cutting the incomes of low income working and non-working families - is bringing about the sharp reductions in child poverty which ministers insist will happen.