Higher employment will help reduce poverty in Scotland, but won’t eliminate it unless we address pay and employment standards.
In recent weeks there have been a flurry of reports addressing poverty in Scotland and the UK. In this post we highlight some of the key findings.
A briefing written by the New Policy Institute (NPI) and published by the Joseph Rowntree Foundation (JRF) looks at the challenge that Scotland would face to tackle poverty, even with a much higher employment rate. Scotland’s employment rate has remained at or above the UK’s employment rate for the last eight years. It currently stands at 73.5% and could reach 80% by 2025. At current population levels, this would mean an extra 300,000 jobs in the economy.
The report authors analysed the impact of this growth, looking at what would happen to poverty levels under two scenarios, depending on whether the extra jobs were full or part-time. They found:
- If the 80% benchmark was reached by the creation of only part-time jobs, poverty among working age adults and children could fall from 800,000 (19.4%) to 670,000 (16.2%).
- But if most of those extra jobs were full-time, the number in poverty would fall further, to 600,000 (14.6%). 65% of them would be in working families.
This highlights the importance of a higher ‘work intensity’ – where families are able to access jobs with more hours. But this brings problems of its own: policy makers will need to ensure there are sufficient high quality, flexible and affordable public services such as transport, childcare, adult social care and health services, to make it possible for a family to work longer hours.
Housing is also highlighted as a key issue by the JRF. They say that the focus of debate on housing has been dominated by the bedroom tax, and while this is important we must not lose sight of the bigger picture: more families facing higher housing costs and rising levels of poverty among those living in private rented homes. A point UNISON has made strongly in our submission on the Housing Bill.
The Scottish Government’s Expert Working Group on Welfare has published its second report looking at the principles, which could underpin the welfare system in an independent Scotland.
This report and its 40 recommendations also recognises that paid employment is the best route out of poverty for anyone who can realistically be expected to work. However, it also identifies the importance of an effective social security system, not just as a safety net, but as a springboard to a better life.
While Scotland has many advantages, we still have a more unequal society than many other OECD countries and it is that inequality that is a drag on economic performance. Employment rates amongst older workers, particularly women, who also suffer from underemployment and need additional support in balancing care with paid work.
While the proposals are modest, rather than radical, it is encouraging that the report welcomes the importance of the quality rather than just the availability of work. Particularly important is the call for an increase in the Minimum Wage to a Living Wage level.
Work carried out by the Improvement Service (IS) revealed there are strong relationships between positive and negative outcomes in Scotland, with areas experiencing one form of deprivation tending to be disadvantaged in several other sectors too. This was a feature of the Christie Commission report published three years ago this month.
IS has analysed three groups comprising the 330 most deprived neighbourhoods, 330 central neighbourhoods and 330 least deprived neighbourhoods in Scotland over 10 years. They found that the disparities in multiple life outcomes are generally persistent and in some cases continuing to grow. The significance of this study is that it looks at neighbourhoods rather than individuals. People born into a deprived neighbourhood in Scotland have a higher chance of being income deprived, of needing emergency hospitalisation, being a victim of crime, and achieving poorly in education. In this respect, the neighbourhood in which you live can have a substantial impact on your future experiences and outcomes.
Another JRF funded report, notes that one in five Scottish children live in poverty and there is a strong and enduring association between low household income and low educational attainment. Social inequality in educational attainment at school level in Scotland appears to be around the OECD average. However, there are many countries that have narrower gaps include Norway, Japan, Canada, the Netherlands and Australia; and the attainment gap is also slightly lower in England. The JRF review concludes that narrowing this gap has not been a social policy priority in Scotland. It notes that the agenda around poverty and educational achievement in Scottish education is, “virtually invisible in the key documents that provide advice for schools and on-the-ground examples of policy and curriculum development.”
Taking a wider UK view, two reports published this week should act as a wake-up call to the government and society at large, as welfare reforms drive millions of the most vulnerable in the UK into destitution. Oxfam’s “Below the Breadline”, compiled in conjunction with Church Action on Poverty and the Trussell Trust, revealed a 54% rise in the number of food parcels distributed in Britain over the past 12 months. Oxfam has also pointed to the Bedroom Tax and limits on Local Housing Allowance driving over 80,000 Scottish households deeper into poverty.
The Social Mobility and Child Poverty Commission has also reported that 3.5m children would be in poverty by 2020 without strong measures aimed at low-income households. It forecast that the UK government will fail in its legal duty to reduce child poverty by 2020. Together these reports tell an all-too-familiar tale about the impact of UK government policy on the poorest in society. It is one in which the poorest and the most vulnerable are penalised for their poverty.
There is a lot of analysis in these publications that paints a pretty bleak picture in Scotland and the rest of the UK. Possibly more important, also some recommendations for action. However, they all require policy makers to understand that inequality is holding everyone back.