:
You had me slightly worried there, because I thought I was at the wrong committee meeting.
Thank you very much indeed for that kind remark. Thank you again for the invitation. It's not usual that I'm at the other end of one of these committee hearings, but I'm always happy to do it. In fact, I was due to be at one this week at our end, on education, to do with what we've written, a committee chaired by a Labour MP in the House of Commons, and I had to decline because I said this committee was more important.
I'll say anything to please this committee.
Can I just say first of all that it is a great pleasure to be here. I thought I'd say a couple of words about what we do. I want to stress at the beginning that the Centre for Social Justice, as you said, Chairman, is not parti pris in the sense that I'm a Conservative, but I've no idea what pretty much everybody who works for me votes for. We are funded separately from the Conservative Party. I have to raise that money, and I raise it from people who are interested in what we do and are committed to the concept of social justice.
As you see, we've worked with the Smith Institute. We're in the process of discussing further work with some other think tanks that you would classically describe as on the left--IPPR, which is quite big. We've had plenty of invitations to work with others. And I've done a personal piece of work, a pamphlet on early years intervention, which I recommend. I'm happy to send the committee all of this stuff. I did that with a Labour MP named Graham Allen, who used to be a government minister. He's a very good friend of mine, but we also happen to fundamentally agree about development in children in the period of nought to three years--and I'll say something about that later, how that intervention should work.
By the way, you have a fantastic program here in Canada, which I've yet to see. The Roots of Empathy program, I think, is in that area, and whatever you are doing, I hope you do get to see that particular program because it is one that I would like to see us take to the U.K.
The Centre for Social Justice was set up by me because I was rather tired of the stilted debate that goes on between--I'll be honest with you--the so-called social liberals and the so-called social conservatives, into which you can bat around the faith issues as well while you're at it. It struck me that this hasn't done anything for the debate about what's happening to our society in the U.K. in the last 25 to 30 years and almost under the noses of what has become a pretty high-level and rather pointless political debate.
What we're actually seeing in the U.K. is the growth of residual unemployment, social breakdown, and--I can argue--deep-rooted poverty lifestyles. It's ironic because the U.K. would pride itself on being, arguably, the fourth-largest economy in the world. It did seem peculiar that when I went round and visited a lot of what I would describe as inner-city communities, as I have done over a number of years now, what struck me was that you can move a short distance and find yourself in an area--for example, in parts of Glasgow like Carlton Place or Easterhouse, Gallowgate, places in the east side of Glasgow--where the life expectancy is around 50 to 55 years. Yet if you walk seven miles up the road to another part of Glasgow, the life expectancy is 82. It seems to me quite peculiar that you should have this incredible disparity in life expectancy within a metaphorical stone's throw within the same precincts of the city.
I would assume that there will be problems similar to that in Canada, but I make no major assumptions and I'm very happy to be led by you on this. But the thing that bothered me about that was that it seemed that we had reached a point where there was a growing disparity between people at the bottom of the socio-economic group and people in the rest of society, and that it was gathering in distance. And the more dysfunctional group, the group with the greatest problems, was actually growing in number.
One of the key issues that I've often been attacked on by people on my side of the political divide is that this is all very nice, but it's all about costs and spending money. My answer to everybody about that is that actually we're already involved in spending vast sums of money because we are driven constantly by the nature of growing demand, so to pretend that somehow this is about getting involved where we shouldn't be.... We're already involved in that. Let me give you some figures for that.
The cost to the state in the U.K. of family breakdown is now well over £20 billion a year, that is to say the cost of picking up the pieces. The reason for that is that we know that the income of a lone parent, once that family splits, falls dramatically. It can be anything up to a third in total, so the state invariably, if that family is not reasonably wealthy, is going to probably end up stepping in to uplift the income in some particular form. It could be through income support or some form of incapacity benefit, or one of the myriad benefits--housing benefit, for example, to sustain them in some form of housing.
So the state is already involved in the process of breakdown. The question is really, is it so reactive that it has no influence, or does it have any negative influences?
So the Centre for Social Justice was set up to look across the piece at what drove social breakdown.
Again, the other part of the argument I was rather tired of and that we tried to knock on the head was that poverty is solely an issue of money. That has often been the debate. So we ask if we can spend more money, if we should spend more money on this, and where it should be focused, rather than asking in a fully grown economy like the U.K., where there is arguably no shortage of employment or has been no shortage in normal times, why some people are trapped in unemployment and poverty.
It's different if you are looking at a country like Haiti or some place where you may have absolutely no employment, so you can understand that there are issues, but not in countries like Canada or the U.K., where these economies are well developed, diverse, and for the most part spread across most of the country.
So we're dealing with a slightly different issue. We looked at this and said, yes, of course, money is an issue. The definition of being in poverty still remains the fact that you don't have enough money to be able to make the necessary choices for you or your family. However, I felt it's more important to look at what drives people toward that situation. We felt that the lifestyles of people are part of that equation.
We wanted to look at what the key drivers were. We talked hugely to the voluntary sector who work in these communities. What were the main things they found in trying to deal with social breakdown? We boiled it down to five pathways that invariably lead people into that process of being too poor to be able to maintain their own lives without assistance.
The first we found was family breakdown; the second--these are not in order, by the way--was debt; the third was failed education; the fourth was worklessness and dependency; and the fifth pathway was damaging addictions to drugs and alcohol, although we did add gambling addiction to the studies later on, because we came under a lot of pressure from people in various towns where there has been an intensive process of casino building, etc., where they found there are some connections with failed communities as well. So later on we put in a section about gambling, but that was not one of our main areas.
The point we discovered about this was that so often the argument has been stilted. It's all about family breakdown or it's all about something to do with drugs or alcohol. We found each one of those five pathways played onto the other, so they're really a cycle, a circle of deprivation that leads one to the other.
Just to touch on it, one of the areas we found, for example, was that family breakdown leads to very poor outcomes. Up to 75% are more likely to fail at school, and a whole series of poor outcomes are increased by family breakdown--drug and alcohol abuse, debt, criminality. It doesn't exist in isolation.
One of the studies thrown up to me, which was fascinating, was that debt was probably one of the biggest causes of family breakdown. So you need to understand what is happening with debt. In the U.K. we had the highest level of personal debt. Over £1.3 trillion was owed in personal debt within the U.K. before the recession began.
We know the people who suffer most when it comes to debt are people in the poorer communities. They have very little access to competitive debt. They have therefore to pay inordinately high levels of interest. Now here in Canada perhaps that's not quite so bad because you have a slightly better position for poorer people. But in the U.K. we have doorstep lenders who charge very high levels of interest, up to 100% to 180% on bona fide loans, short-term payments, encouraging them to borrow for things that perhaps they don't need to borrow for. Then if they can't pay those off, they normally fall into the hands of the unofficial lenders who charge--it's very difficult to calculate--500% to 1,000% for loans, and failure to pay leads to physical abuse, etc. So we found that debt was one of the most classic examples of putting the pressure on families.
We also found, interestingly enough, that debt is one of the areas families cannot talk about. There is another area they don't talk about so much, but I don't think I want to place that in front of the committee. But the debt area was one that we found families, the two adults, will not talk about to each other, and therefore much of the family breakup takes place on other issues. But when you track it back, it comes back to debt.
This is the point we made about family breakdown costing about £20 billion-plus a year to the U.K. economy. We found that we spend between £500 and £800 per taxpayer on picking up the pieces, but we spend about 40p to 50p per taxpayer on assistance and support for families who are in difficulty; in other words, for counselling and help and support. From most of the evidence we took, you can end up with a 40% or 50% improvement in stabilizing families, yet we spend next to nothing on it, but we spend all this money on picking up the pieces afterwards. So we were asking questions about how we got ourselves into this position.
I'll work very quickly around the other areas.
It becomes self-evident that if you're in the position of a broken home, you're more likely to fail at school. That failure at school, clearly, leads you to being less likely to have any skills that are tradeable in the economy, less likely to be able to lead you to any form of sustainable employment.
We know that unemployment is, again, one of the big drivers to family breakdown. We also know that it leads, clearly, obviously, to debt. We know that debt leads to family breakdown. We also know that therefore people in these sorts of communities are more likely to find themselves falling foul, with drug and alcohol abuse. And drug and alcohol abuse, again, will lead to family breakdown. It's very difficult to sustain a family system if one of you is completely addicted to a form of alcohol or drugs.
It's also necessary, when we talk about money, to remind ourselves that these lifestyles make a huge impact. For example, it is quite feasible to take somebody and give them enough benefit to get them above the poverty line--60%, in the U.K., of median income. But their lifestyle will dictate how they use that money.
For example, if you were to simply give an unemployed individual who had a serious drug abuse problem enough money to get him above...which is quite feasible--governments can do that--I would guarantee you that if he had a family, his family would remain in poverty. The reason is because the drug addict, the drug abuser, is most likely to spend the majority of the money on his drug habits, thus leaving his family without enough money to survive properly. As far as the state would be concerned, that family would be out of poverty, but in reality they would not be, and therefore that lifestyle plays enormously on the way in which the money is used.
So the amount of money isn't always critical; it's how that money is ultimately used.
I have a very good example. The state very rarely asks, in the U.K., if you have a family. They doesn't ask drug addicts who are in treatment if they have children. The result of all of that is that the figures for children get lost. We know that there are more than a million kids who find themselves with parents who are seriously addicted.
I go to communities in Glasgow, where you will find that the drug addiction is enormous. It's not just there, by the way, it's in all the cities. Heroin abuse can be fantastic. In a place like Easterhouse, you'll come across whole households where, if they're lucky to have two parents, they'll both be addicted to drugs. And that makes it impossible for them to see their lives through.
I want to finish up on this point. I've done some work, with Graham Allen and others, on early years intervention. The thing that really does make this all come together is the fact that we now know--most of the neuroscientists tell us this, it's a physical fact--that the first three years of a child's life are arguably the most important years in their lives. The reason for that is because your brain develops at a faster rate in those three years, physically, than at any other time in your life. We all know that your brain develops only until you become an adult. It stops developing, and thereafter it simply atrophies and atrophies at whatever rate. Some of us are responsible for higher levels of atrophy than might otherwise be the case. Personally, I make no claim for myself. But the reality is that the first three years will set the tone for how your brain develops.
There are three critical factors. One factor is empathetic nurturing and care from an adult, in this particular case a member of your family, a mother or a father--more often the mother--with the ability to be able to work through play and interaction with that child to stimulate and develop that brain. The second factor is conversation, a child understanding that words become tools of communication. And third, reading, even to a child who doesn't understand words is absolutely vital. These three things, believe it or not, may strike you as fairly sensible. Probably everybody around this table had it happen to them. I don't know, but I would assume that was the case, which is why you may well be here. The reality with a lot of the families that I see is that this is a total mystery to many of them. Many of them will be from second- and third-generation dysfunctional homes.
I visit families where you will see the daughter having a child, with the mother who already has a number of children and another on the way, with the grandmother, who may only be 40 years old or in her late thirties, who is already in a relationship with other people and who is pregnant again and will have a child who will be as old as the granddaughter. In other words, the nature of the communities is becoming quite peculiar in some of these areas. You'll see young women with multiple fathers to multiple children. There was a case the other day in which she couldn't remember who the fathers were to most of the children.
In this whole process of dysfunctionality and breakdown, it's not that they don't love their children--I'm certain they do--but it's just that no parenting skills are passed down by the second and third generation. In fact, what happens is they're left to shift for themselves to understand what those may be.
The result of all of that is you'll visit these homes and there will not be a book on the shelves, which is not surprising because the mom never reached the reading age of 10. She herself doesn't read. Videos are in the room most of the time, and the children grow up in an environment where they witness quite a lot of violence and abuse--certainly a lot of anger. They go to nurseries at the age of three not school ready. Their brains are physically smaller than those of functional children and the neural pathways are all broken and certainly not developed.
These are the communities that I talk about when I talk about social justice. They're growing in number, and I think it's no longer possible for a modern society to ignore what is happening beneath them, which is this collapse of natural structure that is leading hugely to children growing into adults incapable of providing for themselves in the way that you would hope for.
That is what we did. We carried out a series of studies. This was the second of two studies on these five pathways. The other one is just as big--sorry about that--and the others have gone on to look at things like children in care, as I said, early years intervention and street gangs, which we've just completed. All of that is trying to paint a picture and show policy alternatives to that social breakdown.
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Right. I can't give you an absolutely comprehensive list, so I think I'll just dip into a few things the government has embarked on over the last 10 years and whether they've been successful.
The first is that, interestingly, there's been a shift in the poverty figures around children in the last 10 years. The government came in and decided they were going to target—I felt rather narrowly, with this expression that they wanted to eradicate child poverty by 2020—a group of children; they followed the child. Of course, the group that was more likely to be in poverty at that stage were the children in lone-parent relationships. So they targeted them with what I think became today quite a confusing number of different particular benefits. You know, there are tax credits for people trying to get into work. There are child tax credits, which are aimed hugely at those lone parents at the end of the day.
Now what actually happened is that to some degree they have been successful in lifting the children of lone parents up in terms of income. What has actually happened, though, is two things. The first is that I think there are now a growing number of children of couple families who are now falling back into quite deep poverty.
Second—I'm just looking because I've got a figure here somewhere that shows that, and I think these are the figures here now—the proportion of working-age adults in poverty overall hasn't actually fallen, though the level of worklessness in general in the economy has. So you can see this group has absolutely stood still while everybody else has moved forward. This means the poverty rate among working households has actually increased in the U.K. now. Now more than one in seven working households in the U.K. are what you'd describe as in poverty, below 60% of the median income.
Next, the number of households with children in poverty, whose head is workless, actually declined by some 300,000, although that's now static and it's beginning to slide in the other direction. While that is the case, the number of households with children in poverty whose head is working has actually risen by 200,000. So you can see there's been a swing-around. If the family isn't working, the likelihood is that their children are less likely to be in poverty. If the family is now working on these areas, it's likely to be in poverty.
Half of all children in poverty now live in a household in which someone is working. What's happened is that they've succeeded in shifting these figures around. There's been some improvement, but that I think has reached a pretty static position and it's beginning to decline. What they have done is wheeled the whole thing around.
Part of the reason is that the households we're referring to, an awful lot of them are in part-time work. Now, the trouble with part-time work...there's nothing wrong with part-time work in the sense that part-time work for a couple in a household can often be used to supplement income for that household. It may work for the person who is doing it because it's flexible and they can look after their children, but the main income may be earned by somebody else, and that therefore becomes sustainable. The problem in a household where the only income is part-time income is that it's simply not sustainable. You can't live on that particular income, so the government does provide supplementary benefits, as it were, to try to lift that up. The problem for a couple household is that those are nothing like as extensive as they are for a lone-parent family. That's why you see more couples who have work falling back into poverty, because there's a gap now. We call it the “couple penalty”. If you're a lone parent, you get a lot of support. If you're a couple, you don't get as much.
We've also made the point in our work that, in truth, everything should be set to move people from part-time work in due course to full-time work, over 32 hours a week, and the problem there is this. The government, because they have supported people into part-time work, as people want to move from, say, 16 hours a week, which you might describe as part-time work, to 32 hours a week...what happens is the withdrawal rates as a result of their fall-off in their benefit support are so dramatic that in the case of a lone parent, for example, moving from 16 to 32, she can lose up to 90% of the income earned between 16 and 32 hours a week. So for every pound earned, she may take home only 10p. That's a higher tax rate than for the wealthiest people in the country. In fact, I don't know of anybody in the country who would put up with paying a tax rate of 90%. But they do.
So you find for those in that group they have a problem. There is no incentive for them to move beyond 16 hours because that period between 16 and 32 hours is very painful for them. They work long hours in that sense, but they don't get any great reward for it. It's only when they break through, at 32 hours roughly, that their tax rate then collapses back to the bottom end of it and they start to earn reasonable money. But it's very difficult to get them through that.
What's happened, again in part-time work, interestingly, is that there's a disparity now between people on supported benefits, even if in part-time work, and those who are out working where their job is their sole income. I can give you an example here.
A single mother with two children now receives more than a whole series of people. She'll get roughly £262 a week. That's more than the average waiter, who might earn about £113 a week; a cashier, at roughly £128; someone who's stacking shelves in a supermarket, at about £155; a library assistant, at the low grade, at £170; a hairdresser, at about £188; a child minder, at £240; and a street trader, at about £240 to £250, though the last figures are difficult to estimate.
So there's another element to this, and we took evidence from a number of people who said there's not much point in my really trying to get onto the bottom rung because, frankly, I'm going to find that my income will fall off. The reasons for that, obviously, have to do with the housing benefit, and the fact that their support in other areas will fall away and they'll lose it, so they're left wholly having to survive on what they earn.
So all the recommendations we've brought forward on this are to try to smooth that transition period out. What's critical is that work should be seen to pay. If work doesn't appear to pay for people on benefits, they simply will not take it.
Now, all of us around this table, I would hope, understand that work ultimately pays, in the sense that it develops—even if the disparity at the beginning were less—and benefits don't. So these people will in due course go on to earn more than their benefits are worth. But it is very difficult to persuade people who need to take a cut in their income that it's worth doing.
Another area that we found is very difficult for people who are working part time and therefore are still in poverty is that they face another problem. Some of those who have begun part-time work, with a view to developing it, have had a very high churning rate, particularly lone parents, who go in and crash out in a matter of weeks again. Then what happens is that the old “jungle telegraph” beats, as I call it. In other words, information is passed around from people by word of mouth in these areas; most people aren't reading newspapers or documents, but are just talking. So the news goes around by word of mouth that if you take a job, it's more than likely you'll be out of it; that they'll push you towards a job, you'll go into work, and you'll be out of it. It's the worst thing you can do, because it can take up to a month to receive the housing benefit again. What happens is you're now materially worse off for having gone into work for a month, or maybe a month and a half, or two months, as you rush around trying to re-engage your benefits, because the state is very slow to put those together. So the advice that goes around is, don't do it. What happens is that a lot of people then become quite work-shy, because they're scared they're going to be in the same position, the word of mouth being that you're not going to be in a sustainable job.
This is the other point we make, which is one of the biggest problems that goes on in the system. As a country we're very keen on pushing people into work, but in actual fact we do very little to sustain them in work. There's a very good organization in the U.K. called Tomorrow's People. It's a voluntary organization. It prides itself on getting people into work from the most difficult circumstances, and then maintaining them at work for a long time; 75% of those they get into work are in work a year later. The best you can say for government programs, I think, is that 13% are in work something like 20 weeks later.
:
Yes, there has been a lot of work going on in Parliament about getting rid of the discrimination against women in the workplace. I suspect that's what you're referring to. Quite a lot has taken place in regard to that, but still there's a debate going on about the disparity in income between men and women in the U.K.
Some of that is met by the fact that women are more likely, proportionately, to be in part-time work. So when you look at the figures across the piece, they don't always tell you the full story. But there still is, in some cases, a glass ceiling. There are still problems for women both accessing certain areas of work and sometimes moving on through them. I would be the first to accept that was the case. I think it has improved a lot over the last 15 to 20 years in the U.K., but there's always room for further improvement.
But the real point I have a problem with is that actually when you talk about poverty and the groups that are in poverty, we don't even get to the point about issues over women, because there is an absolute absence of skills and capacity even to get to the point of debating whether women are able to be in the workplace. The fact is many of the women that I see in these conditions have no reading age worth talking about, they have little or no skills, they left school early, and they're in very destructive relationships. And that applies to their children, who then go on to repeat much of that themselves.
The problem here is that many of them are not ready for work at all. The idea that you can cram somebody into work simply because you have a target is an absurdity. What you have to do is work with the person to make them work-ready. That's not to say you put them on courses to make them carpenters or steel welders, or whatever it happens to be, but you do need to get rid of some of their problem, maybe drug or alcohol abuse, maybe issues concerning mental health problems, or poor reading capacity. Sometimes you need to work with them first to get them ready for work, so that when they get to work, they're more likely to stay in work.
Then you need to mentor them. There's no question in my mind that if you do not follow through with someone who has never held a job before and comes from a family where there has been no work, they are almost certain to crash out of work unless you support them for the next nine months or a year in their work so they get the work habit that is a fact for most people around this table.
That's not understood by a lot of people. They often say, “When they get a job, why don't they stay in work?” The answer is because if you go home to a family in the evening that has never had a job for three generations, where nobody understands what the hell you're doing going to work in the first place, the moment you hit a problem with your boss, what are they going to say to you? They'll say, “I don't know why you bothered. Why did you bother to take a job in the first place? I wouldn't bother. It's a waste of time. Stick at home. Don't do it.”
They have no support with a view to going out, and they see nobody in their community who is doing so. We have social housing estates where, literally, people will grow up not seeing a single person go out to regular work. They'll see no fathers. Fathers have disappeared from these estates, in a structural sense. Often they're only destructive forces and they will be seen only in street gangs or as drug dealers. They will not be seen as a member of a household contributing to that household. Very little of that goes on.
If I lived in a community like that, the chances of me sitting here today would be almost nil.
:
This brings me back to the point I've just made, which is on early intervention. This encompasses all of that sort of work.
There are some interesting things about child care that we discovered. Again, if you have a chance to really go through this stuff you'll see there's a section on child care in here. Also, in the report that I've done with Graham Allen, the Labour MP, we looked very carefully at the early intervention models that exist around the world. We've done a huge amount of work on this. I recommend that you have a chance to look at that as a group, as an organization, as a committee.
What we do know is that there is child care and child care. The very best child care is of course the parents taking the decision to see that child through for a period of time and having that one-on-one care, with one of the parents responsible for the empathetic love and nurture that is critical at the beginning. But if that for some reason can't be done, if there are pressures of money, etc., and if there are two parents and they both want to go out to work, or if there's one parent who has to work, it's who replaces that. Then you have a hierarchy of child care, and it's worth looking at that hierarchy.
We think there's not enough done to support the functional extended family in this process. If you are a member of an extended family in the U.K.--I don't know what it's like here--you cannot receive any money for looking after your daughter's child, let's say, as a grandmum, or whatever. We think that's rather stupid and pointless. We think some money should be available for them, because after all they're doing a service, and if it's not them, then they're going to be paying a lot more money to go to a child minder anyway. So we know that therefore the figures show that really good support from the extended family--obviously where the family is functional and capable--has a very good effect on the child in the absence of the mother or the father looking after them. We think that works.
Failing that, we think that obviously very good one-on-one nursery care works. At the bottom of the pile, which people don't understand, are these multi-child nurseries, I have to say, which we found have very poor results. In some cases they may lead, even in middle class families, to difficulties later on. The parents place them there in the belief that they're giving a good service, but in fact because there are so many children in them and there are so few people who look after the children, they don't get this one-on-one development, which is vital, absolutely vital, to the child.
We think more work needs to be done looking at that multi-child nursery. We think that too often government is obsessed with health and safety. We in the U.K. have this big thing about that, so when they're inspected they look at whether they have fire exits, is everybody clean, and are there enough people here to look after them in a general sense. Nobody actually looks at the quality of care. The quality of care should really be looked at in child care. This empathetic, one-on-one care is absolutely vital, and it can be quite difficult if it doesn't exist.
So we do believe in that, but as I say, the hierarchy works. As for early intervention, if you can please have a look at that, it's critical.
:
Well, I come back to the point I made earlier, that it all starts before the child is born. It starts with the stability of family life around that child and that mother. So that mother arrives at that point of the birth in a stable, unstressed relationship. If you look at it, most of the sociologists will tell you now that if a mother is deeply stressed and in trouble, stress is taken across straight to the child.
For example, there was an interesting figure--I just saw it today from a lecturer I was reading about--and it said that a child is more likely to suffer from asthma if his mother has had a very high stress level at the time of birth and just after. Interestingly, chemically, there are real crossovers between high levels of stress and the superficial conditions of asthma. I'm not an expert in this, but the point we did discover throughout this is that relationship between the would-be mother and child is absolutely critical.
Secondly, what we did find was that all of those points about empathetic care and nurture, reading, conversation, and calm environments are critical again for the further development through to three. The reason why I'm a bit obsessed about naught to three is because I really now believe that this is the critical place where most of our communities are breaking down because families do not realize how important this is. We've had debates with people saying that children will cope. Children do cope, but the trouble with coping is sometimes coping means failing, but not demonstrating how much failure there is and what is going on is a refusal to understand that this period is so important.
Now one of the areas we've argued about is, for example, if a mother did want to stay at home and look after her child for the first year or two, and she was good and capable of doing that, I would think from society's standpoint that that's an incredibly strong and powerful decision to make, if she feels she wants to do it. If she doesn't and she is somebody who would prefer to be at work again, that's her choice. What we shouldn't do, though, is set the choices so that she finds staying at home so much more difficult financially than having to go out to work. We need to look at allowing parents to make those choices so that they're balanced. In other words, they can make that choice without panicking about the idea that they're about to take such a hit on their finances that they're not going to be able to survive that process.
So it seems to me that society has a vested interest in being able to get that balance right. I don't ask that society, that government, tells anybody what to do, because we're not very good at doing that, but I simply say that we should just even up the playing field so that people can make those choices. That is the critical component, because from all that comes community; everything about our community starts with that relationship, particularly, between the mother and child. From extended family to extended family, it's the balance of community. The more stable families in a community, the more stable a community is going to be, the more they're likely to help each other, the more they're likely to work for each other. Then your voluntary sector groups are set up from stable families, from people who understand that.
The point I make about this outreach and the encouragement of the voluntary sector is that most of this is about picking up the pieces for the breakdown in family and extended family; they then come in to be the extended family where none existed. That's the point I'm making. So understanding that this is the beginning of it all and that our attention in government should be here.... And I have to tell you that in our spending programs in the U.K., the older the child gets, the more money we spend on them. We spend next to nothing, it's a bit better now, but comparatively nothing.... Most of the figures show that for every dollar spent on a child between naught to three, it's worth a minimum of $16-plus that you spend on a child of 14, 15, and 16. The differences are quite dramatic.
:
Thank you very much, Chair.
First of all, I want to say thank you so much for inviting me here today. I'm very excited about the strategy we've tabled and embarked upon in Ontario. I'm delighted to have the opportunity to speak to the committee about what's in the strategy, how we got here, why we're doing it, and how we're going to move forward to achieve the success we are determined to achieve.
I want to start by saying that I was happy to see in the budget that there are some initiatives that will directly improve the quality of life and the standard of living for kids living in poverty. The increase to the WITB will directly help low-income families. Thank you for that. The housing initiatives are, of course, very helpful. The increase in the CCTB is also appreciated. I will talk a little bit more about that a little later in my remarks.
I want to start by talking about why we embarked upon a poverty reduction strategy. We are all elected people in this room, and we know that the issue of poverty is one that has been raised by a solid and committed, but small, group of people, particularly among faith-based organizations and social justice organizations, for a long time. They have been making the moral argument, what I call the moral argument, that to have the levels of poverty we have in this country, in a country as rich as the one in which we live, is simply not morally acceptable. That is as true now as ever before. But what has changed a little bit is the economic argument. There is now a growing understanding that we can't afford poverty. Poverty is too expensive.
I don't know if you've seen the Cost of Poverty report that was recently released by the Ontario Association of Food Banks and Don Drummond, chief economist at TD. It makes the argument that poverty costs every household in Ontario an average of $3,000 or close to $3,000. That's the cost of poverty. So it's not just about them; it's about all of us.
The other kind of economic consideration is a demographic consideration. As our population shifts, we need to make sure that every child who is born in this country or who comes to this country--everyone--is given the opportunity to achieve his or her full potential. We need all people at their best. So we have now both a moral and an economic imperative to really address poverty and to make sure that everyone has the opportunity to achieve his or her full potential.
That's really what has motivated us to embark upon what some people say is a topic on which you'll never win. They say that poverty has always been with us. If you think you can make a dint in it, well, good luck to you. But we look at our seniors and at the progress we've made in seniors' poverty. We know that the rate of poverty among seniors is now at around 3%. That has come down enormously over the past many years, because government decided that we needed to act on it, and we did act on it. The success we've had with seniors we can have with other segments of the population living in poverty.
I want to say that this was an issue that was really pushed hard by the women's caucus. It was the women in our caucus who made it our top priority. And when the women's caucus decides that their top priority is poverty, then we will act on poverty, because we don't stop until we're done. So it was the women's caucus. But then it was embraced, I have to tell you, by the entire caucus, and particularly by our leader, and thankfully by our finance minister, because that matters.
So what did we do? We had a line in our campaign platform before the 2007 election that committed us to developing a comprehensive poverty reduction strategy, with measures and a target. We committed to building on the Ontario child benefit, and we committed to working with our stakeholders to develop that strategy.
I was given the enormous opportunity to lead our poverty reduction strategy. We had a cabinet committee--it's now transformed--that was 15 members. We recognized that this was not something that one ministry could do on its own.
We all have a role to play in the reduction of poverty. The inter-ministerial nature of the work goes through every initiative in our strategy. It really is at the foundation of what we're trying to do. We have to work together in a more coordinated way.
One of the most difficult decisions we had to make was where to start. If your job is to reduce poverty, where do you start? We knew we had to start somewhere. We had to refine our scope.
So we started with kids. We started with reducing poverty and increasing opportunity for kids. We did this for the very good reason that the evidence is abundant and very clear that you get the best return on investment when you make it as early in a child's life as possible, as early in a person's life as possible, even prenatally. The return on investment is much greater the earlier you start.
We wanted to start with kids, and that's what we did. Our strategy addresses all people living in poverty, but the initial focus is on reducing child poverty in this province.
We embarked on a consultation strategy. I travelled around the province. I met with groups of people. We tried to get as broad a community representation as we could. Most importantly, we wanted to hear the voices of people living in poverty. We wanted to hear from those who weren't known to be part of the poverty community--business, police, others who had a stake in reducing poverty but weren't already part of the conversation.
I think the most important thing we did was to listen. And we did listen. We engaged MPPs from all sides of the House in poverty reduction consultations in their own communities. That in and of itself was very important. MPPs from across the province started to understand poverty, to understand the reality of poverty in their own communities. Even though we as elected people are as close to our communities as anyone, there are still stories that members needed to hear about how poverty impacts their communities.
We had wonderful participation in the consultation. We had a website that listed questions that we were interested in hearing feedback on. We had over 600 submissions from organizations and individuals to our website. We had people meeting around kitchen tables, around boardroom tables. They embraced the opportunity to participate in the development of a strategy.
I think one of our great successes over the course of our year was that the conversation changed. When we started talking about poverty reduction, it was a somewhat acrimonious conversation. There was deep distrust between those who were concerned about poverty and government. We worked hard to build a strong sense of trust. People who had been protesting on the front lawn of Queen's Park were now inside, sitting around the table, figuring out how to move forward on it.
There was a wonderful transformation of the tone, so much so that when we released our strategy in December, there was overwhelming support for it, even amongst those whose initial focus was not child poverty. I think that was a good year.
What's in the strategy? The title of our strategy is Breaking the Cycle. Our real focus is on breaking that intergenerational cycle of poverty, so that kids growing up in poverty are given the opportunity to be successful. It's about more money in the hands of low-income families. People made it very clear in our consultations that if you want to reduce poverty, that means more money in their pockets.
So the strategy is to be $1.4 billion annualized when fully implemented; $1.3 billion of that will be an income transfer, through the Ontario child benefit, directly into the pockets of people living in poverty.
I want to give you a quick example of what the strategy means. When we were elected in 2003, a single mom with two kids, working a full year, full time, would have had an income of just over $19,000, only a couple of thousand dollars more than she would have had on social assistance. When this strategy is fully implemented, her income will have gone up by more than 54% to over $30,000—the same woman with the same kids, still working a full-year, full time, minimum wage job. The difference between trying to make ends meet on under $20,000 compared with over $30,000 is enormous. It means more stable housing. It means better food. It means the kids aren't going to move from school to school as frequently. It's going to mean that the kids will have an opportunity to participate in some activities outside of school. It will make an enormous difference in those kids' lives, opportunities, and success.
That will actually be achieved even without more federal investment than is already planned. The big movers behind this are the increase in the minimum wage and the Ontario child benefit.
So for that group we will see success. Those kids will be moved from well below the poverty line to nicely above the poverty line; it's not in the lap of luxury, but it's above the level of poverty.
It's about money in your pocket, but it's also about a full range of programs to promote academic success and moving into work, into employment. So it's about before school, after school, and pre-school programs. It's about summer jobs for kids.
The strategy very much takes a community-based approach, so we have initiatives in it to help communities develop capacities to determine their own strategies. We don't expect communities to develop strategies that actually increase income, but we do expect communities to develop strategies that increase opportunities for social engagement, and we've seen some wonderful examples of that already.
We have some targeted programs aimed, in particular, at a group of kids for whom I know we can do far more: the kids who are wards of the crown. They are remarkable, wonderful kids who just need the opportunity to achieve their potential. They are kids who, by definition, have experienced severe trauma, and we need to do a better job for them—and we're doing that.
We have a section in our strategy called “Smarter Government”. We heard everywhere we went that there was a lot of money wasted in the delivery of service for people, that services were difficult to access, that we had a lot of work to do to get our act together to make sure we spent our money on initiatives that actually improved the well-being of people in the community. We know we have some difficult work ahead of us on that, but we are committed to doing it.
Part of our strategy is legislative. We've introduced legislation—in second reading now—which will make this the first of a series of poverty reduction strategies. It will mandate that future governments renew a poverty reduction strategy every five years. It will commit those governments to transparency, that is, to measuring and reporting annually on their progress.
We are committed to measuring our progress. We've identified eight indicators, three of which are income-based and three of which are education-based, because we know that the best protective factor against poverty as an adult is education. So we want our kids to be doing better. And we are committed to reporting on those indicators every year. We have set one target; the target is to reduce the number of kids living in poverty by 25% over the next five years.
That will improve the standard of living of all kids living in poverty and lift 90,000 kids, including those I talked about earlier, up and out of poverty altogether. In order to achieve that we all need to work together, and that is another foundational principle of our strategy. This is not something the Province of Ontario can do on its own. We need everyone working together with the same objective.
We are very explicit about our request to the federal government, and very pleased, as I said, with the increase in WITB. On the target indicators, there are two things we're asking the federal government to do. One is to increase WITB to $2,000 a year. It's now up to over $1,600--thank you for that very much. We're also asking you to increase the NCBS by $1,200 a year. If you do those two things, and if we do what we're undertaking to do, and the economy.... We're very clear that we need a certain economic growth to make this happen, but they are reasonable assumptions in our model. If we all work together, we can achieve this; we can do it. And we lay out how it can be done.
There are also some other initiatives that don't relate to the target but certainly affect poverty and well-being that we are asking the federal government to come to the table with, to be part of.
You are probably all familiar with the inequities in employment insurance. That is a very serious problem for us, an increasingly serious problem. An unemployed worker in Ontario receives on average $4,600 less than an unemployed worker in Alberta or anywhere else. That's not okay. It's not fair. It's time to fix that.
We need a renewed commitment to early learning and child care. This is extremely important. If we want kids to do well, they need to have that early learning. If we want parents to work, we need to have child care. We need a renewed commitment to early learning and child care.
We need to work together on housing, and we have seen some very promising steps there.
We need a targeted commitment to improve the quality of life and well-being and the opportunities of aboriginal peoples. We really need to get back to doing what we need to do so that aboriginal kids growing up are given the opportunities to be successful.
I'm going to close there and throw it open to questions. I'll leave it with you there.
I'll preface, Deb, in view of a speaker we just had, but as much in terms of my own family background here...because sometimes I feel there's a sense of dissonance almost. I think all around the table we want to get at these issues. I think we have some common meeting of the minds on a lot of things. Obviously, there's some ideological divide at some other points.
For example, I'm just beyond the plus-50 mark now, but growing up my family was well below what was called low-income cut-off; in fact, that would have been way up there someplace. Yet our family had what we needed. We didn't have all our wants, for sure. I suppose there were points where we whined about one thing or the other that we thought we needed and didn't have. But from my family background, well below the low-end cut-off, the poverty level, there were the issues.... And this is what I'm getting at, in terms of the question I put to you, in terms of there being other factors. Sometimes we look at a strict dollar line that's below the poverty level and we don't always look at other factors that are pretty key in the equation.
Within my family situation, literacy was very much encouraged--reading, lots of it. We all can read, and do it fairly well. All of us have gone on and had advanced education as well. The faith community, in my case a Christian evangelical background, was encouraged--clubs and camps, and a variety of those kinds of things. Sports was encouraged as well, so we all had a taste of ball and hockey. And Cubs, Scouts, those types of things, were very much encouraged. My mom and dad are still living. Dad's in his mid-80s, I guess, at this point, and very grateful for that--but well below the poverty level, for sure.
I think also of the farm families that I grew up with as a boy. Even today, when you look at their income tax returns, many of them would show below the “poverty level”, but because they have cattle, they have chickens, they maybe have a hog, they do their own butchering of meat, and they have gardens and so on, they have those basic provisions made. I'm just trying to point out that sometimes, in terms of a strict dollar equation, at least in other parts of the country.... Maybe it's different in the urban areas, and we always fall into using urban examples. But the family and family function, if you will, was obviously pretty crucial. I know many other families were not in dissimilar situations, but they're serving, contributing in their communities. All my brothers and my sister are married, with families of their own, contributing, serving, involved in their communities and so on. So there have to be some different elements here.
I think of what the Right Honourable Duncan Smith, who just testified before you here moments ago, said. He made the point of not making the focus on kids—I know in some of your comments you have referred to the support of families and so on—but rather on the family, the family structure. Strong families make for strong communities that can help one another, and it extrapolates from there. That's a question I'll ask you to respond to a little bit.
Some of the other comments here have been in terms of lifting kids out of poverty. The previous witness indicated that it's more important, in terms of those dollars...and we don't give them actually to kids in their pockets, per se, but to the families. But it doesn't necessarily lift them out of poverty, depending on how that money is spent, right? So that's probably as determinative as anything.
I know on the rolls and the stats and so on it may look like we've lifted x number of kids out of poverty, but do we always know? I guess that's a question. Do we always know the kids are lifted out of poverty--other than the fact that the dollars that have supposedly gone to that family? We don't know that in these cases. That is a question.
So could you respond in terms of the other factors that make for poverty, not strictly the dollar things, and on the issue of the stats? When Ontario or any province says they've lifted these kids out of poverty, do we really know, other than by the dollar thing?
I have a third question—and I'll leave it here for you to get back to me. I'm intrigued with some of your comments about these pilot projects. I think there's a lot of good insight in some of that, family networks and so on. I would be intrigued to hear about that if we had more time here; maybe we will later.
I always get a little bit anxious and nervous, I guess, speaking about lifting minimum wage, lifting this benefit up to the $5,000 level, the $2,000 level. I know there are other people out there who read the news in the papers--the landlords, the grocers, and so on.
If you have increases in any of these things, sometimes that margin of benefit or difference is very shortly thereafter swallowed up, because greater society is aware of it. All your costs kind of go up in these other areas. I'm concerned about unintended consequences. Say we raise these levels, and then all the costs go up a proportionate amount. You're hardly any further ahead.
That would be my third thing to respond to a bit, if you could. I believe we have to deal with symptomatic issues without laying blame and judgment, necessarily. I also think there are some organic things we need to look at, such as root causes. I'm not sure that we always do it that well at the federal or provincial level.
:
No, no. It was your family.
What I'm saying is that some families have the capacity to do that. Others do not. Our question, then, is whether, as our collective responsibility, we're going to let the kids of the families that do not have that capacity repeat that intergenerational cycle. Or are we going to step in and say that we think it's good for kids to have a place to go after school, so we're going to make sure that the schools are open and that there's supervision there so they can go and participate in after school programming?
We actually think that there's a good economic argument for providing those opportunities for kids. Otherwise, what happens is that the cycle repeats itself, and the kids end up in the care of the state one way or another. It's really building on that.
You're absolutely right. It's about more than money, although I must say that there is a certain base level below which you cannot survive in our society. You have to have enough money to buy food and to pay the rent and to pay for some of the extras, such as transportation or a telephone, even. You're right about that.
Do we really know whether we're raising kids out of poverty? Yes, we do. We have good statistics that will tell us. We spent too much time, probably, trying to figure out what measure of poverty to use. We landed on one that is used internationally: the low-income measure. We also added a depth-of-poverty measure so that we can track how deeply in poverty people are. I think that's important. As I said, we're also developing the deprivation index so that we'll understand the sort of quality of poverty.
There's a component in our strategy that I'm pretty excited about. It's the establishment of what we're calling for now, a social policy institute. We need to move to much better evidence to guide our funding decisions. For example, some of the pilot projects.... We have to know whether an investment here pays off there. When it comes to social services, I would say that we're pretty early, especially compared to health care, in evidence-based practice. We're pretty young when it comes to looking at the evidence and at what makes a difference.
That takes us to Pathways to Education, a program for kids in neighbourhoods where the dropout rate.... You're going to hear more about this. It's extraordinary what that range of interventions has done for the graduation rates of kids who typically had very high dropout rates.
For me, it's all about a return on investment. If we make investments up front so that kids do better and graduate more, become taxpayers, are able to provide for their own children, that's a really good investment. We can have conversations about ideology, but for me, it's about getting the job done.
If we can make investments that will change the opportunities for children, we are all better off for it. It's not just about the kids who benefit. We are all better off in a very tangible way. We will pay less down the road if we get there early. As we move forward, we really have to look it at from that standpoint as well.
As for the concern that if we increase the standard of living for kids, others will take advantage, I think—
:
I have a couple of things that I want to throw out there as we consider the schedule.
We will have a working schedule prepared for when we get back from the break so we can look at what we're going to do.
I'm proposing right now that we look at travel dates. I just want you to mark this down. We don't need to have any discussion. I want you to look at it and consider what we have to decide collectively when we come back, just so we can prepare accordingly.
I'm suggesting that we travel for the first three days of the last week in April and that we possibly fly out west. This would be half the committee. We would fly out on the 26th, spend a day in Vancouver, a day in Calgary, and a day in Winnipeg, and then be done on the 29th for that leg of travel. These are suggestions based on witnesses we have. I know there was a lot that people wanted to do, but I'm going to throw this out for discussion after the break week.
The next thought was to perhaps travel out east, leave after caucus on May 6 and travel to Montreal, and then finish in Halifax on May 8.
The last suggestion for travel, if we are going to break this up into three parcels, is to leave again after caucus on May 27 and spend two days in Toronto, May 28 and 29.
I know people have requested other towns and places. We can travel according to what you think. I just want to throw this out there for you to look at your schedules and try to figure out how we're going to fit it all in. We might decide to add more days or to do different things.
That is what we're going to consider when we come back from the break. We're going to try to fit in different witnesses. We can have some discussion on whether we need to do more or do less, but we'll have to come up with consensus from the group as to what we plan on doing.
I know last time we spent two weeks. We went out one week and came back the following week, and it was a lot of work. So the suggestion was that we break it up a little bit. We're suggesting these as possible dates, as far as that goes.
Mr. Martin wanted us to participate during the break week in May. We need to have some discussion about that when we come back, because my question is, do you people want to give up your break week to travel? We have not scheduled anything yet, because it has to be approved by you. The conference takes place in Calgary during the break week in May.
I just throw these dates out to you to think about during the break week. We're going to have to come back and approve a schedule so that people can start doing these things. If anyone wants to change these things, we're going to need to decide that collectively and determine what we need to do.
The break week starts May 18, and Mr. Martin has suggested that we travel out there that week for the conference. We're just talking about those dates right now, as far as that goes.
I have to remind people that we talked about possibly having meetings on May 18. However, May 18 is a holiday Monday, so I think that would be a challenge for us. We may need to do something different.
I am going to take a couple of names. I don't want to spend a lot of time debating the schedule. I want you to think about it and come back after the break, and we'll look at what we're going to do and come to some consensus. But I certainly will take any points that need to be made at this point in time.
Tony, and then Mike.