The new government is an opportunity to reset the conversation about poverty in this country. But will we see the kind of action we need? In this blog, I’ll explore four areas the government could act, some of which are easy, others not so.
The easy ask: showing moral leadership
The dividing lines on poverty are often about fairness. Some people think it’s unfair that people are in poverty, and that our economy and society should act to prevent it. Other people think that it’s unfair that the state should have to support people who they perceive aren’t contributing.
The past 14 years saw a government that drew on the latter, harsher sentiments to justify sharp cuts to benefits and an often-draconian approach to welfare-to-work. This now needs to flip. We need our senior political leaders making the case that moral case for tackling poverty - to lead public opinion, not follow.
The refusal of the new government to get rid of the two-child limit makes it feel like more of the same. This has a real impact on people's lives, and the sector is right to call for the policy to be scrapped immediately. But there is good reason to believe that it won’t last very long.
The green shoots come from Labour’s commitment to developing a child poverty strategy, which is already underway. We’ve recently co-funded some work with the Fabian Society which will set out a roadmap for ending early years poverty, focused on actions that increase parental income. Being serious about tackling child poverty will mean politicians will once again have to make the case for an effective social security system – including ending the two-child limit. This will need to be a moral case, made to the country in the full knowledge that the majority won’t agree. It needs to ride roughshod over the idea that ‘we can’t afford it’.
I appreciate it isn’t a revolutionary ask for politicians to show moral leadership. But given recent history, it’s a fundamental step forward from which we can build. Let’s hope they meet this low bar.
The hard task: making housing in London more affordable
The ’levelling up’ moniker is gone, and reliance on London’s economy isn’t going away anytime soon. Indeed, if the government’s central mission is ‘growth asap’, London becomes even more important.
But London’s overheated economy has had dire consequences for the cost of living in the city. Demand for housing has pushed up prices so much that we think people are being forced out like never before.
We also think that expensive housing constrains London’s growth, which is why we’re working with the Greater London Assembly, London Councils and NERA Economics to drill down into the relationship between housing affordability and productivity in London.
So if it’s serious about focusing on growth, the new government must aim to tackle London’s housing crisis. During this parliament, it has committed to building 1.5m homes across the country. Many of these need to be in or around London. But even then, it won’t be enough to reduce the cost of housing through increased supply – there is simply too much pent-up demand.
The only answer is a once in a generation investment in social housing. In an era of fiscal restraint, this may go down as ‘unaffordable’. But £1.6bn of housing benefit goes into the pockets of London’s private landlords each year. Investing in social housing will eventually pay the exchequer back. We need long-term thinking to override short term constraints.
The politically impossible? Ending migrant destitution
Migration is in London’s DNA. This city’s incredible diversity and capacity to welcome people from all over the world is why many of us live here.
But migrants are often much more likely to be in poverty – and a big part of this is the policies that make up our immigration system. So being serious about tackling poverty in London means helping migrants. It means ending the hostile environment and creating an immigration system that doesn’t cost the earth to navigate. It means ending the use of No Recourse to Public Funds (NRPF), which prevents many migrants from access services and benefits when they need them.
These are objectives we’ve committed to supporting through our 2030 funding strategy. But it’s politically difficult terrain for a government that will be under pressure to tackle illegal migration and reduce legal migration. We hope to see progress but are under no illusions about how difficult it will be to affect change.
The unknown stance: tackling racial injustice
Black and minoritised Londoners are disproportionately affected by poverty. Working with the City Bridge Foundation, we’ve setup a Racial Justice Fund to find ways this might be reversed. We’ve also funded ShareAction to encourage shareholder action to get big companies to, amongst other things, report on the ethnicity pay gap.
This is something that the government has now committed to making mandatory through a new race and disabilities equality bill, announced in the King’s Speech. It will be an important step forward and is focused on right thing: the intersection between racial and economic justice.
But it can only be the start. The election highlighted a schism between Labour and Black and minoritised communities, and there is still the lingering fallout from the Commission on Race and Ethnic Disparities. A broader commitment to tackling economic racial disparities is the way forward to rebuilding trust and showing that this government takes racial injustice seriously.
Conclusion
Over the last 14 years, the broader conversation about poverty has stalled. Our new government has the opportunity to reshape the narrative. This will take political courage. They will be attacked by political opponents using well established dividing lines around Labour’s profligate approach to public finances. But by showing moral leadership, the government can take the first steps to reframe the way we talk about poverty and take the action we need to see.
To really make change, there are harder tasks ahead – such as the bold investment needed to tackle the housing crisis. Our job as a sector is to keep making the moral and economic case to the new government, so that it grasps the opportunity it has to reframe the debate around poverty and make a real difference to people’s lives.
This isn’t an exhaustive list on how to tackle poverty. For that, I'd recommend reading the interim report from the Poverty Strategy Commission.
