Feature Article

Poverty: the cost to families

Religious leaders, charities and politicians gather in London next week for the tenth National Poverty Hearing. They will learn that many families struggle to survive below the Government's deprivation thresholds, with consequences for children's education

Most children love "Mufti Days" at school when they wear their own clothes instead of school uniform in return for a donation to charity. But some pupils dread these days and choose to stay at home rather than face the scorn of their fellow pupils for not wearing the latest clothes.

Such embarrassment is one of the milder consequences of the poverty suffered by children in Britain today. Even the Conservative leadership now believes that the ever-widening gap between the poorest and the most affluent in our society needs to be addressed. I welcome the sea-change in the Conservatives' thinking but they are wrong to describe the worst poverty in the United Kingdom as relative.

To have no money anywhere is absolute poverty. To have far too little money in a very expensive developed economy also threatens survival and is also absolute poverty. According to the charity End Child Poverty, 3.4 million children live in poverty in the UK, a shocking figure for such a wealthy country. Their parents' incomes are all below the poverty line and sometimes a long way below due to overpayments and other debts. We have one of the worst rates of child poverty in the industrialised world - a fact that will be highlighted at the National Poverty Hearing on Wednesday.

The poorest children in the UK are more likely to be ill, to die younger and to be disadvantaged in our schools. The latter is especially worrying as education is key if children are to avoid the poverty suffered by their parents. One teacher, who has spent eight years teaching in two inner London comprehensives, told me that homework for some children is a virtual impossibility. Overcrowded homes with no table to work at and the television blaring constantly are not conducive to rote learning or coursework. The teacher tells of one boy who fainted at school because he had not eaten for 24 hours. There was no food at home and no money for school dinner. Another was persistently late caused by broken nights because he had to sleep in an armchair under a coat.

Some children have onerous tasks to perform when hard-pressed parents are at work. One particular girl begged the teacher not to refer to her poor punctuality on her college application reference because she frequently had to negotiate public transport with her school bag, PE kit and a pushchair, as she had to drop her little brother off at the childminder's before going to school.

I have witnessed vulnerable families struggling to survive on inadequate unemployment benefits, then move over the line of legality into desperate but illegal attempts to beat poverty and assist the education of their children. One such case in the 1990s was a single father with three sons. He had gained legal custody of the children after his wife left him. His unemployment benefit was being taxed with 20 per cent of the poll tax. We have since discovered that, before it was taxed, the benefit was already at least £40 below barest minimum needed for healthy living, after commissioning research from the Family Budget Unit.

The family were most embarrassed by their poverty when they were unable to find the money for summer holidays, decent school clothes, birthdays and Christmas. Very few families were poor in their wealthy town, so the boys had to suffer listening to the tales of summer holidays, seeing the better clothes at the beginning of the school year and the yield of expensive Christmas presents shown off at school. Their father was humiliated by the family poverty and set about trying to help his children hold their own in the playground. When they were young, just starting school full time, work was impossible.

His first step was to borrow £500 from a high-street lender to which they added £274 interest to be paid off over 31 weeks. Other similar loans followed. The interest deepened the family poverty below the inadequate, and already taxed, benefits. He was still desperate when a friend suggested he could earn £50 a time carrying "parcels" in a plastic bag from Person A to Person B. Then A suggested he moved from carrying drugs to selling £700 worth for £800 making £100 a parcel instead of £50. My friend delivered one parcel to sell but the buyer disappeared without paying and was never seen again. He paid off A in small amounts while a third party paid for him and his boys to eat. He has never carried such parcels again.

Town Hall bureaucracy also has much to answer for. Jane was living in a two-bedroomed, damp flat with five children and pregnant with the sixth. The council refused to move the family of seven to a larger house because there were rent arrears, which would have been covered by housing benefit had she filled in an annual form at the right time, but she is epileptic and semi-literate. Social Services said it was the responsibility of the Housing Department and vice versa. I suggested to the chairmen of both county and district councils that the matter should be decided by judicial review. I argued that the overriding consideration should be the needs of the children whose education and health was being damaged by overcrowded, damp housing. Social Services paid off the arrears and the family was moved, but to a three-bedroomed house far from the shops and the school, so huge problems remain.

Hilary Fisher, campaign director of End Child Poverty, emphasises that it is important that poor children are able to go to good schools and can participate in the relevant activities and trips as well as afford uniforms and equipment. It is also essential that they are able to come to school ready and able to learn, not worrying about what is happening at home, how safe it is to go to and from school, and eat nutritious food, including breakfast.

Housing is another fundamental issue. Shelter estimates that 55 days a year of schooling are missed by homeless children. If housing is inadequate children are also unable to study at home, and also suffer from ill health which affects their learning.

The true definition of poverty is in the level of the income remaining after all taxation and housing costs have been paid for - officially known as After Housing Costs (AHC). It is on that AHC share of total income that urban survival depends in the UK; it pays for food, fuel, clothing, transport, school trips, holidays, birthdays, Christmas, all other necessities and the ravages of the interest charged by home credit companies.

According to the Government's criteria, a family is living in poverty if its income - after housing and taxation costs have been paid for - is less than 60 per cent of the equivalent median income. Answers to parliamentary questions show that Income Support and Jobseekers Allowance paid to the unemployed after all taxation and housing costs have been met, are below the poverty threshold.

If income in work is to be the route out of poverty, as it is measured by government, it must rise above 60 per cent of the median income after housing and tax. That is becoming increasingly difficult as the cost of housing, transport to work and utilities rise and squeeze the income that remains to pay for food, fuel, clothing and parental support for education, both in and out of work. The rising cost of rented accommodation, particularly in London, is resulting in parents, who are above the income threshold for receiving housing benefit, and who therefore pay their own rent and council tax, finding that they are left with a lower AHC income in work than when they were unemployed.

We need macro-economic answers to poverty that include more vigorous housing policies that address buy-to-let, the flood of lending and the supply of housing, and that deal with the grotesque inequality in the distribution of incomes and wealth. The pips are squeaking in the poorest households in the UK. Talk of relative poverty should be replaced by a debate that faces these facts.