Over the course of our study on the federal government’s contribution to poverty reduction, the Committee paid close attention to strategies that have already been developed to tackle this important challenge. Jurisdictions across Canada and around the world have undertaken a variety of anti-poverty initiatives, and the federal government can learn from these efforts as it moves ahead on this issue. This chapter will outline the poverty reduction strategies currently in place in Canada’s provinces and territories as well as in the United Kingdom (UK) and Ireland.

2.1 Poverty Reduction Strategies in Canada’s Provinces and Territories

To date, six Canadian provinces have introduced specific strategies to reduce poverty. Québec was the first to do so with the adoption of Bill 112, An Act to combat poverty and social exclusion, in December 2002[221] and the subsequent release of its action plan Reconciling Freedom and Social Justice: A Challenge for the Future.[222] In June 2006, Newfoundland and Labrador followed with its own strategy, Reducing Poverty: An Action Plan for Newfoundland and Labrador.[223] These earlier provincial initiatives informed Ontario’s poverty reduction plan, Breaking the Cycle, which was released in December 2008.[224] In 2009, the governments of Nova Scotia,[225] Manitoba,[226] and New Brunswick[227] all announced their own strategies to combat poverty within their borders. At the provincial level, energy is clearly building in the fight against poverty.

As I said, the goal of poverty reduction is being taken up by provinces across the country, including Ontario. There are provincial poverty reduction strategies, there's poverty reduction legislation, and now there is innovative programming. Provinces have come to realize that creating public policy to reduce poverty is not only the just and decent thing to do—which I would argue should certainly be reason enough to act—but it's also the smart thing to do if we want strong economies and healthy communities.[228]

Sarah Blackstock, Income Security Advocacy Centre

There is a momentum in Canada to deal with poverty. When we began to examine the need for a strategy back in 2005, there were only two provinces in this country, Québec and Newfoundland and Labrador, that had an anti-poverty strategy. Today Ontario, New Brunswick, and Nova Scotia have also developed anti-poverty plans, and Prince Edward Island is contemplating bringing one in. The five provinces that do have anti-poverty plans represent two-thirds of Canada's population.[229]

Lynne Markell, Canadian Co-operative Association

Other provinces and territories are also taking action on poverty-related issues. The Government of Alberta, for example, introduced a long-term strategy to combat homelessness entitled A Plan for Alberta: Ending Homelessness in 10 Years in March 2009.[230] The Government of Yukon has also recently announced the development of a new social inclusion strategy for the territory that will target issues such as poverty, housing, education, employment, and social participation.[231] Organizations that advocate for poverty reduction have applauded these advancements, but continue to push all provincial and territorial governments to develop comprehensive poverty reduction strategies.

It's not as though nothing is going on in this province to try to address issues of poverty. Most of the issues, however, are focused on poverty alleviation rather than any real vision of poverty prevention or poverty reduction; there is no provincial plan here. We are hoping that community organizations, business groups, and the municipalities will all come together to work with the provincial government, and ultimately the federal government as well, to put a plan in place.[232]

Bill Moore-Kilgannon, Public Interest Alberta

Today I am representing a group called the British Columbia Poverty Reduction Coalition. The coalition represents over 200 NGOs—health, community, faith, [F]irst [N]ations, [A]boriginal, and civil society groups—that have been advocating for the reduction of poverty in British Columbia. Our coalition believes that there is nothing inevitable about poverty. Our goal is to see the development and successful implementation of a provincial poverty reduction plan, with targets and timelines for eliminating poverty in our province, similar to what has been done in other jurisdictions across the country and internationally.[233]

Daryl Quantz, British Columbia Poverty Reduction Coalition

a. Consultation Processes

Over the course of our study, the Committee heard repeatedly that public consultation is an important step in the development of a poverty reduction strategy. This was demonstrated at the provincial level, where many of the strategies currently in place were shaped through public input. The governments of Québec, Newfoundland and Labrador, and Ontario engaged in wide consultations before introducing their poverty reduction strategies. The Committee on Social Affairs (Commission permanente des affaires sociales) in Québec’s National Assembly, for example, heard from close to 135 individuals, groups and organizations, and received 166 briefs prior to the adoption of Bill 112. As well, government officials met with over 1000 groups in the 17 regions of Québec regarding the orientation document entitled Don’t Leave Anyone Out.[234] In Newfoundland and Labrador, dozens of workshop sessions and focus groups were held on the background document Reducing Poverty in Newfoundland and Labrador: Working Towards a Solution.[235] Individuals and organizations were invited to submit their ideas by telephone and in writing. The Government of Ontario set up a cabinet committee on poverty reduction that undertook consultations across the province to provide information regarding its poverty reduction strategy. Thousands of people gave their input in a variety of forums, including 14 roundtable sessions.[236]

I think the most important thing we did was to listen. And we did listen. We engaged MPPs [Members of Provincial Parliaments] 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.[237]

Hon. Deb Matthews, Government of Ontario

More recently, Nova Scotia and New Brunswick have conducted comprehensive public engagement exercises to inform their own strategies. The Government of Nova Scotia conducted a public survey and established the Poverty Reduction Strategy Working Group (PRWG) to provide recommendations on how to efficiently tackle poverty in the province. The PRWG included members from government, labour and business organizations, and community-based social justice and advocacy groups. Its recommendations were published in a June 2008 report, which served to guide the development of their provincial poverty reduction strategy.[238] New Brunswick developed its poverty reduction plan through a three-part public engagement process that it launched in fall 2008. New Brunswickers were invited to participate in public dialogue sessions held across the province. Their views and opinions were recorded in a report entitled A Choir of Voices.[239] A roundtable composed of representatives from the government, business, and non-profit sectors used this input to develop a series of options for poverty reduction in the province.[240] A final forum was held, and a poverty reduction plan for New Brunswick was released in fall 2009.

All six provinces intend to continue to seek public input as their poverty reduction plans move forward in order to ensure that their strategies are making a real difference in people’s lives. For example, a representative of the Government of Newfoundland and Labrador underscored the province’s commitment to ongoing public input during an appearance before the Committee.

That's been an important part of our process, the involvement of our community partners. We have regular consultations with our community partners. Every second year, we go out more broadly to speak to them and check in on how we're doing and what we might need to do differently. We're getting ready to start that process again now.[241]

Aisling Gogan, Government of Newfoundland and Labrador

b. Defining Poverty

While not every strategy includes a definition of poverty, the provinces generally identify poverty as a broad concept that not only reflects a lack of adequate financial resources, but also encompasses social exclusion. The ALL Aboard strategy adopted in Manitoba indicates this explicitly:

Manitoba recognizes that poverty is not only about money; it is about social exclusion. Social exclusion occurs when individuals, families, or communities face poverty-related problems, such as unemployment, poor housing or family breakdown. These issues tend to keep them from the benefits, resources and opportunities they may find from participating more fully in their communities and reaching their full potential.[242]

The theme of social exclusion was also highlighted by Newfoundland and Labrador’s Minister of Human Resources, Labour and Employment during his appearance before our Committee.

I do want to point out to your committee that we took a very broad definition of poverty. Our definition of what we mean by poverty encompasses social exclusion, so it's not just money that we're talking about here. In our definition of poverty we wanted to make sure that we consider things such as a person's ability to participate in their community, a person's education level, a person's access to adequate housing, a person's access to essential goods and services, and a person's access to health and their own personal health status.[243]

Hon. Shawn Skinner, Government of Newfoundland and Labrador

c. Poverty Reduction Targets

Canada’s provinces have adopted a range of targets and timelines to guide their poverty reduction efforts. (See Table 2.1.) Some poverty reduction strategies include specific and measurable goals, while others include targets that are less tangible.

Table 2.1 Provincial Poverty Reduction Targets

d. Main Areas of Intervention

To meet their poverty reduction objectives, the provinces have adopted multifaceted approaches. (See Table 2.2.) An obvious component of each strategy is meeting the basic needs of people living on low incomes. Québec, for example, has started indexing its last-resort financial assistance benefits in 2009, resulting in a 2.36% increase of benefits for that year,[250] while Ontario has increased the Ontario Child Benefit, which provides additional financial support to help low-income families provide essentials like food and shelter for their children.[251] The province of New Brunswick will introduce a program that provides vision and dental care to low-income children,[252] and Newfoundland and Labrador is currently providing additional supports to those making the transition from income support to employment.

For people who are on income support or welfare, as you may refer to it, we have an overlap period now. If somebody leaves income support and goes to work, for the first month after they go to work they're still entitled to receive the regular benefits that they would receive. We allow a transition period. There is not what we call that welfare wall, where they drop off the cliff because they've gone to work. We have earning exemptions now so that people who are on income support and go to work can keep up to 25% of the money they earn; we won't claw it back. So if somebody goes out and earns money now, we want them to understand the value of working and what they get in return for being able to work.[253]

Hon. Shawn Skinner, Government of Newfoundland and Labrador

Many strategies also recognize the importance of strengthening the supports available to all people, including those who would not be considered as living in poverty. Nova Scotia has temporarily frozen university tuition for all students;[254] Ontario has enhanced its employment and training programs;[255] and Manitoba has identified the need for regular increases in the minimum wage.[256] The Committee also heard about the positive results of Québec’s child care program, which provides support to families at all income levels.

Something else that emerges from what has been done in Québec over the past decade, is that the policies that have worked best are those that target all families, households and individuals. Social policy experts have a saying that is heard not only in Canada but throughout the western world. I think it comes from a Swedish sociologist, who once said that policies for the poor are poor policies.

Child care centres are an example of this....By creating child care centres that are affordable and accessible to all, these are not policies for the poor, they are policies for people who have children. What occurred as a result—and econometric studies are very clear on this—is that women of employable age were able to enter the labour market...young families have also started having more children. Having children is, in a sense, coming back into fashion in Québec. Good things come hand in hand.[257]

Alain Noël, as an individual

The importance of efficient and effective government machinery is also identified in many provincial poverty reduction strategies. Provinces are striving to deliver accessible services to the public and to coordinate their actions within their own government, as well as with those of other levels of government and community organizations.

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.[258]

Hon. Deb Matthews, Government of Ontario

Table 2.2 Main Areas of Intervention in Provincial Poverty Reduction Strategies

The provincial strategies also recognize that some people are more vulnerable to poverty than others and include targeted supports for certain groups. Each province has identified children and families as an important focus of poverty reduction efforts.

In terms of the goals of the poverty reduction strategy, one of the five key goals was an increased emphasis on early childhood development and its importance foundationally in terms of success at learning, success in employment, and success from a health perspective. I think that's been woven each year into the direction our working group and committees have taken as they bring forward initiatives for funding in each budget cycle. One of the initiatives funded this year, for example, was additional support to healthy baby clubs, which is a comprehensive, holistic approach to working with pregnant women and supporting them with food supplements, nutrition, and other aspects of issues related to lifestyle and support in pregnancy.[265]

Lynn Vivian-Book, Government of Newfoundland and Labrador

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.[266]

Hon. Deb Matthews, Government of Ontario

Other groups whose unique needs have been identified in provincial poverty reduction strategies include women, seniors, people with disabilities, Aboriginal people, single-parent families, unattached individuals, newcomers and visible minority groups. Some provinces have also recognized the important relationship between poverty and violence: “[v]iolence can trap women in poverty and poverty can trap women in abusive relationships”.[267] In many cases, provinces have committed to providing tailored solutions to help all these groups overcome the challenges they face. The Government of Québec, for example, has pledged to adapt its poverty reduction measures according to the needs of Aboriginal communities,[268] and Newfoundland and Labrador will use gender analysis as it develops poverty reduction measures and tracks its progress.[269]

e. Strategy Implementation

Most provinces have adopted an integrated approach to poverty reduction that involves coordination across government departments under the leadership of a minister or ministerial committee. For example, in Ontario, a “results committee” is chaired by the Children and Youth Services Minister and includes other cabinet ministers, members of provincial parliaments (MPPs) and outside experts. The committee is responsible for overseeing the implementation of the poverty reduction strategy and tracking progress on key indicators.[270] In Newfoundland and Labrador, the Minister of Human Resources, Labour and Employment, along with a committee of ministers from other portfolios, is responsible for the efforts to reduce poverty in the province. This work is supported by a Deputy Ministers’ Committee and an Interdepartmental Working Group.[271]

Many provinces have also set up new organizations to ensure that the needs of people at risk of poverty or living in poverty are clearly identified and addressed as their strategies move forward. New Brunswick will introduce “community economic and social inclusion networks,” local organizations composed of representatives of people living in poverty as well as the non-profit, business and government sectors that will all play a role in the coordination of poverty reduction efforts.[272] The Government of Ontario will create an independent Social Policy Institute to evaluate social policy, identify best practices and develop innovative strategies for the province “in specific areas of competitive strength, social policy and economic importance”.[273] The Government of Québec has created various bodies to guide the implementation of its strategy. An advisory committee, the Comité consultatif de lutte contre la pauvreté et l’exclusion sociale advises the Minister of Employment and Social Solidarity on the planning, implementation and evaluation of the strategy;[274] a research centre on poverty and social exclusion, the Centre d’étude sur la pauvreté et l’exclusion sociale, provides reliable and rigorous information on poverty and social exclusion issues;[275] and a fund, the Fonds québécois d’initiatives sociales, supports initiatives aimed at combating poverty and social exclusion.[276]

f. Monitoring and Accountability

Public accountability is important. Provinces have thus introduced a variety of provisions to ensure regular reporting on the implementation of their action plans. The first provinces that released strategies are the most advanced in this regard. In Québec, the Minister of Employment and Social Solidarity must submit an annual report to the government on the activities undertaken as part of the Action Plan to Combat Poverty and Social Exclusion.[277] The province’s fifth progress report was released in February 2010.[278] Newfoundland and Labrador has committed to releasing reports every two years outlining progress on various indicators, as well as approaches for addressing shortcomings.[279] Its first report, Empowering People—Engaging Community—Enabling Success was released in December 2009.[280] The Government of Ontario pledged to report annually on its poverty reduction strategy[281] and released its first-year report also in December 2009.[282] Finally, Nova Scotia’s first progress report is expected in 2010.[283]

g. Poverty Measures and Indicators

To track their progress, the provinces have adopted various measures of low income. Manitoba’s poverty reduction strategy points to the Market Basket Measure (MBM), the number of affordable housing units built, graduation rates, and the percentage of children with access to regulated child care as possible indicators to track their progress,[284] while Nova Scotia has identified the uptake of the Working Income Tax Benefit (WITB), the prevalence of children living in low-income households according to the LICO, and public awareness of poverty-related issues as preliminary measures.[285] Both provinces plan to develop and report on full suites of measures as their strategies move forward.

In Québec, the Centre d’étude sur la pauvreté et l’exclusion recently released a report entitled Taking the Measure of Poverty in which it proposes the adoption of the MBM as a “baseline indicator to monitor situations of poverty” and also recommends the use of “several other complementary measures to establish comparisons in time and space, or to identify other dimensions of poverty, inequality and social exclusion.”[286] The province currently employs the MBM as its primary reference measure, while also relying on other indicators.

The provinces of Newfoundland and Labrador and Ontario have developed innovative new measures of low income that allow them to track the progress of their poverty reduction efforts in specific ways. One of the fifteen performance indicators to be tracked in the Atlantic province is the Newfoundland and Labrador Market Basket Measure (NLMBM). Developed by the province’s statistics agency, the NLMBM provides analysis of low income in small geographic regions and among different sub-populations.[287]

What the Newfoundland and Labrador Market Basket Measure does is allow us to track who's falling below those cut-offs at the community level. So we can look at almost 400 different communities in our province and we can look at who's falling below the particular cut-offs of the market basket measure. The basket itself has been costed for all these different communities, so it's a very regionally sensitive measure, unlike the HRSDC one. Also, as I mentioned, because we're using income tax data, we don't have issues of sampling error, so we can look at any geographic area of the province, and in that community overall we can look not only at who's falling below the cut-offs but at family composition—the age, and those sorts of things—so we can target our initiatives where they're needed.[288]

Aisling Gogan, Government of Newfoundland and Labrador

Among the indicators being tracked by the province of Ontario is a new deprivation index developed by the Daily Bread Food Bank and the Caledon Institute of Social Policy.[289] The Ontario Deprivation Index determines the number and percentage of families and children in the province with access to an acceptable standard of living. According to the measure, a family lives in poverty if it is unable to afford two or more items out of a list of ten, including such things as eating fresh fruit and vegetables every day, having a hobby or leisure activity, and having appropriate clothes for job interviews.[290]

h. Calling for Federal Support

The majority of provinces maintain in their poverty reduction strategies that in order to successfully improve the well-being of their populations, a willing federal partner is required.

Our government is committed to act in areas where we have the capacity and the jurisdiction to act relative to poverty reduction, but we believe that in order to be successful, many partners are necessary. The federal government is one of those partners we have to be committed to working with, and we believe we can work cooperatively with the federal government in terms of addressing poverty in our country.[291]

Hon. Shawn Skinner, Government of Newfoundland and Labrador

I think every one of the provinces, including Manitoba, that has put forward a poverty reduction strategy has pointed to the role of the federal government, perhaps most explicitly in Ontario, where they really said they could not meet their targets in their child poverty reduction plan without the participation of the federal government.[292]

Sid Frankel, Social Planning Council of Winnipeg

Many provincial governments specifically request that the federal government contribute to their efforts to reduce poverty in Canada. The Government of Manitoba has asked its federal counterpart to improve access to education and training for low-skilled workers, increase child care funding, and increase investments in affordable housing, for example.[293] Ontario has also called on the federal government to undertake a variety of measures. The minister responsible for the province’s poverty reduction efforts outlined some of these requests during her appearance before our Committee.

We are very explicit about our request to the federal government, and very pleased, as I said, with the increase in WITB [Working Income Tax Benefit]. 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 [National Child Benefit Supplement] 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.[294]

Hon. Deb Matthews, Government of Ontario

i. Successes

Many provincial poverty reduction strategies have been recently introduced; and as it takes time for poverty reduction measures to have a significant impact, their success cannot yet be determined.[295] However, it appears that the provinces of Quebec and Newfoundland and Labrador made some progress in the fight against poverty even if the availability of the information to substantiate this improvement is still limited.[296]

Perhaps more compelling than the call for federal engagement is the fact that existing provincial strategies are already making a difference. They are coordinating government programs and eliminating counter-productive practices, publicly reporting on progress, and agreeing to be held accountable for their actions. What is more, by 2007, those living on social assistance in Québec and Newfoundland and Labrador had already seen some improvements.[297]

Citizens for Public Justice

Data reveal a decline in the number of people living in poverty in Québec between 2002, when the province adopted its anti-poverty legislation, and 2007. Based on the after-tax LICO, the overall proportion of people living on low incomes in that province went from 12.3% in 2002 to 10.7% in 2007, and the proportion of children living in low-income families decreased from 11.3% in 2002 to 9.5% in 2007.[298] According to Québec’s most recent progress report, which employs the MBM as its primary measure, low-income rates dropped from 10.9% to 8.5% over the same period. In addition, the number of recipients of last-resort financial assistance decreased by 10.6% between March 2003 (544,229) and March 2009 (486,282). Among children alone, an 18.2% reduction was observed. The minister responsible for Québec’s strategy to combat poverty and social exclusion recently concluded that the measures put forward in the first plan improved the quality of life of thousands of people living in poverty in that province.[299]

In Newfoundland and Labrador, 6.5% of the population, or 33,000 people, were living on low incomes in 2007 as measured by the after-tax LICO. This represents 5,000 fewer people than in 2006, when 7.6% of the population lived on low incomes and the province’s poverty reduction strategy was introduced. Children saw a greater drop in their low-income rates, which went from 9.3% in 2006 to 6.5% in 2007.[300] The province’s first progress report on its poverty reduction strategy also indicates that it is “well along the path to success.”[301] About 4,000 people on income support started new jobs between 2006 and 2008, and basic individual and family benefits have increased by an average cumulative 11.6% from 2006 to 2009.[302]

Notwithstanding the progress that has been made, there is no doubt that the recent economic downturn will have hindered poverty reduction efforts in Canada’s provinces. When Ontario introduced its strategy, it indicated that its ability to meet its poverty reduction target was contingent on a growing economy.[303] Since then, the recession has had a serious impact in Ontario, and the province’s recent progress report indicates that “today’s economic weakness will affect incomes and possibly push more people into poverty in the short term.”[304] Québec has also seen the consequences of the global economic downturn: the unemployment rate increased from 7.2% in September 2008 to 9.1% in August 2009; it has since then decreased to reach 8.1% in February 2010. Studies indicate that Québec’s system of social security has lessened the effects of the economic recession in that province.[305]

j. Moving forward

The provinces that first introduced poverty reduction strategies are now elaborating the next steps of their strategies against poverty. The Government of Québec will release its second action plan to combat poverty and social exclusion in 2010.[306] Newfoundland and Labrador will also introduce a new strategy this year to guide its poverty reduction efforts until 2014.[307] In May 2009, the Ontario Government passed Bill 152, An Act respecting a long-term strategy to reduce poverty in Ontario, which requires the province to maintain a poverty reduction strategy and set new targets every five years.[308] New Brunswick has also committed to renewing its strategy in five years’ time[309] and captured the main elements of its strategy in a legislation that was introduced in the legislative assembly on February 19, 2010.

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.[310]

Hon. Deb Matthews, Government of Ontario

All Committee members praise the actions taken to date by provincial and territorial governments to reduce poverty in Canada and improve the lives of their most vulnerable citizens. We are optimistic that the poverty reduction strategies introduced in these provinces can deliver positive results for many Canadians currently living on low incomes. The federal government can learn from these poverty reduction strategies as it moves forward with its own action plan to tackle poverty. Most Committee members believe that the federal government has an important role to play in supporting the efforts of provincial and territorial governments to reduce poverty and income inequality in Canada and that a comprehensive action plan to reduce poverty should be developed at the federal level. Chapter 3 of this report will focus on the important role of the federal government in reducing poverty in Canada.

2.2 Poverty Reduction Strategies in the United Kingdom (UK) and Ireland

The European Union has made a commitment to reduce poverty and designated 2010 as the European Year for Combating Poverty and Social Exclusion. Many European countries have adopted comprehensive poverty reduction strategies.[311] The UK and Ireland are often used as examples of countries that have had some success in reducing poverty and social exclusion.[312]

a. The United Kingdom’s Strategy to Reduce Poverty and Social Exclusion

In 1999, Tony Blair, then Prime Minister of the UK, made an historic pledge to end child poverty in a generation. The goal was to reduce child poverty by 25% by 2005, by 50% by 2010 and to eradicate it completely by 2020. In an effort to meet these targets and to reduce poverty and social exclusion more generally, the UK Government has elaborated a wide range of strategies and initiatives. Starting in 1999, these were outlined in annual reports entitled Opportunity for All.[313] More recently, the government has developed a series of National Action Plans on Social Inclusion that detail how the UK is working to eradicate poverty.[314] Many government departments at all levels, with the help of partners in the community sector, are working together to achieve success.[315]

The UK’s first strategy for tackling poverty and social exclusion, released in 1999, adopted a lifecycle approach with initiatives targeting children, people of working age, and seniors, as well as communities. Policy priorities included, among others, ensuring that all children received a high-quality education, increasing financial support for families, tackling unemployment, making work pay, and ensuring adequate pensions.[316] The UK government recognized that there is more to poverty than low income, and that it is also intimately linked to social exclusion. Its first annual report on the strategy to tackle poverty and social exclusion defined these terms broadly:

Poverty affects different aspects of people’s lives, existing when people are denied opportunities to work, to learn, to live healthy and fulfilling lives, and to live out their retirement years in security. Lack of income, access to good-quality health, education and housing, and the quality of the local environment all affect people’s well-being. Our view of poverty covers all these aspects. ... social exclusion occurs where different factors combine to trap individuals and areas in a spiral of disadvantage.[317]

The UK’s most recent action plan reaffirms the goal of “building an inclusive, cohesive and prosperous society with fairness and social justice at its core, in which child poverty has been eradicated, everyone who can work is expected to contribute to national prosperity and share in it, and those who can’t work are supported.”[318] While a main focus remains the elimination of child poverty, the government’s efforts also target other groups identified as particularly disadvantaged or at risk. These include lone parents, people with disabilities, members of ethnic minorities, people with low skill-levels, and older workers.

The UK government has adopted a multi-pronged approach to address an array of factors contributing to poverty and social exclusion. Its most recent strategy, entitled Working Together: UK National Action Plan on Social Inclusion, outlines the country’s current position and the actions that were to be undertaken from 2008 to 2010 to tackle poverty and social exclusion. Four main objectives are identified. First, the government will strive to improve labour market participation and “move people from being spectators on the margins—as recipients of passive benefits—to becoming participants, actively seeking and preparing for work.”[319] The government’s long-term goal is to attain an 80% employment rate. It is also taking steps to make work pay.[320]

During our hearings, the Committee heard that employment and labour market interventions have always been a major priority for the UK in its fight against poverty but that, to achieve its poverty reduction target, it must go beyond this focus to address the root causes of poverty and provide additional benefits to those who cannot work.

The main plank the U.K. government has pursued to [eradicate child poverty] has been a policy of full employment via active labour market interventions, by trying to get people into work they have not been in before. Attached to this is a policy of trying to make work pay through a whole tranche of mechanisms, such as a minimum wage, tax credits, a form of negative income tax, child care vouchers, and training and education of people who need it in order to be able to get paid work.

[…]

In order for the government to make its target, it needs to do more than it is currently doing to increase the levels of incomes of families who for various reasons cannot work. The simulation models that have been done by some of my colleagues at the University of Cambridge and the London School of Economics and Political Science have shown that full employment and active labour market intervention policies alone would at best reduce child poverty by about half. To get the other half, you would need to do something about the welfare benefits.[321]

David Gordon, University of Bristol

The second objective outlined in the action plan is tackling child poverty.[322] The UK’s renewed drive to tackle child poverty is also evidenced by the recent release of Ending Child Poverty: Everybody’s Business, which reviewed the state of child poverty and outlined the government’s aspirations for the future,[323] and Ending Child Poverty: Making it Happen, which sets forward the steps for achieving this vision.[324] The government has also introduced legislation that enshrines its commitment to eliminate child poverty by 2020. The Child Poverty Bill requires the UK government to develop a specific child poverty strategy and revise it every three years, establish a child poverty commission to provide advice on strategy development, and publish annual progress reports. It also places duties on Scotland, Northern Ireland and local authorities to work towards this goal.[325]

The third objective in the UK’s National Action Plan on Social Inclusion is to provide access to quality services. Examples of planned reforms include giving people with disabilities more control over the types of supports they receive, targeting homeless people and those living in temporary accommodation with additional investments, and working to eradicate fuel poverty[326] by 2016.[327] Finally, the fourth objective the UK adopted is to tackle inequality, with a focus on gender, disability, and race.[328]

While the UK’s poverty reduction strategy has led to important successes over the past decade, a 2009 report finds that earlier progress on some indicators of poverty and social exclusion has stalled, and in some instances even reversed in recent years.[329] Data reveal that the number of people living in low-income households[330] reached a low point in 2004-2005 at 12.1 million, but has increased since then to reach 13.4 million people, or 22.5% of the population, in 2007-2008. This rise has eliminated about half of the progress made since the peak of 14.5 million in 1996-1997. The proportion of pensioners living on low incomes fell from 28% in the mid-1990s to about 18% in 2004-2005, and has been more or less static since then. Working-age adults have seen their low-income rates virtually unchanged since the mid-1990s, when around one fifth lived on low incomes.[331] The plight of working-age adults and the working poor was raised during the Committee’s hearings.

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 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.[332]

Right Hon. Iain Duncan Smith, as an individual

The UK’s specific focus on eradicating child poverty has also had mixed results. The period from 1998-1999 to 2004-2005 saw significant improvement, with child poverty rates falling from 34% to 28%. Despite 700,000 children being lifted out of low income over that period, the government came short of its target of a 25% reduction in child poverty by 2005.[333] By 2007-2008, child poverty rates had increased to 31%, with only 300,000 fewer children living in low-income households than in 1998-1999. The number of children in working poor families also rose sharply to reach a high record that year.[334] In order for the UK to meet the government’s new target for 2020, the child poverty rate must fall at an average of about 1% per year until then.[335]

In the 1980s and early 1990s, child poverty as measured by low income increased threefold. Since about 2000, it has gone back by about a quarter. However, recently, in the past year, those policies have stalled. In fact, by some measures child poverty has been increasing for the past year, and maybe in the previous year as well.[336]

David Gordon, University of Bristol

In the best year, which was 2004-2005, I think something like 800,000 children had been removed from poverty, moved above that income poverty line. That was short of the target but was nevertheless a substantial achievement. We now have two more years' worth of data, and I think they show a very different story. It's not always clear that these things are statistically significant, but the headline figure is that since then, child poverty has slipped back up again by about 300,000. That means, compared with the objective two years ago of reducing child poverty by a million, we have actually now reduced it by only 500,000. We are only halfway to a target of two or three years ago.[337]

Peter Kenway, New Policy Institute

The economic climate nonetheless poses a serious challenge to the UK’s efforts to combat poverty and social exclusion. Since the start of the global recession in 2008, the number of unemployed people has risen by 847,000 to reach 2.46 million people, and the unemployment rate has risen from 5.2% to 7.8%. The number of people receiving Jobseeker’s Allowance[338] has increased by 852,000 since February 2008 and sat at 1.64 million in October 2009.[339] Young people, particularly those with low skill levels, have been disproportionately affected by the economic downturn.[340] Despite signs of a return to positive growth,[341] unemployment is expected to continue to rise into 2010.[342]

Despite the recent rise in low-income and unemployment rates in the UK, other indicators point to the progress of some government efforts to combat social exclusion. For example, research shows that around one million children in working families are lifted out of low income by the tax credits they receive each year. As well, after reaching a peak in 2003-2004, the number of households living in temporary accommodation and homelessness has declined.[343] Witnesses also pointed to the success of specific government measures:

I think the government here has been very successful in raising the lone-parent employment rate, and its tax credit system, which is designed to deliver a significant increase in income to a lone parent if they are working 16 hours a week, is definitely a part of that, a scenario where the incentives that they've designed seem to have worked.[344]

Peter Kenway, New Policy Institute

b. Ireland’s Strategy to Reduce Poverty and Social Exclusion

Following-up on commitments made at the United Nations World Summit for Social Development held in Copenhagen in 1995,[345] Ireland launched its national anti-poverty strategy in 1997. Devised on the basis of widespread consultations, including input from people living in poverty, the strategy aimed to address all aspects of poverty and social exclusion. The initial target set in 1997 was to reduce considerably the number of people who were found to be “consistently poor”[346] from 9 to 15% to less than 5 to 10% by 2007, depending on the measure used (e.g., 50% or 60% of median income lines).[347] In 2002, taking into account Ireland’s substantial economic progress, this target was revised to be more ambitious. The new goal was to achieve less than 2% consistent poverty by 2007.[348]

When it first launched its national strategy in 1997, the Government of Ireland recognized that “addressing poverty needs to be based on an understanding of the multidimensional nature of poverty.”[349] The following definition, which underscores the link between poverty and social exclusion, was adopted at the outset of Ireland’s poverty reduction efforts and continues to be applicable at the time of writing this report:

People are living in poverty if their income and resources (material, cultural and social) are so inadequate as to preclude them from having a standard of living which is regarded as acceptable by Irish society generally. As a result of inadequate income and resources people may be excluded and marginalised from participating in activities which are considered the norm for other people in society.[350]

Ireland has developed a comprehensive approach to combating poverty and social exclusion. Its various initiatives target elements, such as skills and education, employment, income supports, health, housing, transportation, and financial inclusion. As in the UK, Ireland’s strategy also addresses fuel poverty. Those population groups found to be consistently poor or at greatest risk of poverty, including people who are unemployed, women, children, lone parents, seniors, newcomers, and people with disabilities, are also focal points of their national anti-poverty and social inclusion strategy.[351]

A number of institutional structures have been created to ensure that all departments involved in relevant policy areas work together to meet the objective of significantly reducing poverty and social exclusion in Ireland. The overall responsibility for coordinating the government’s social inclusion agenda lies with the Office for Social Inclusion, based in the Department of Social and Family Affairs and overseen by the minister for that portfolio.[352] The office prepares an Annual Social Inclusion Report that provides a detailed progress review of the national inclusion strategy.[353] During our hearings, the Committee also heard about additional organizations working to advance Ireland’s strategy, including the Combat Poverty Agency.

When it comes down to the administrative structures...we build them up from the bottom. We have social inclusion units in each government department and local authority. We then have the Office for Social Inclusion—the office I'm director of—which is, again, there to coordinate the whole process at each level. We have a social partnership review group, where employers, trade unions, farmers, and the community and voluntary sector are involved in reviewing and monitoring progress. We have a forum for consultation—a social inclusion forum—which enables us to meet with people experiencing poverty. Then we have a senior officials group, people at the high level in government departments—I'm a member of it—which provides a whole-of-government form of coordination, and they report to a cabinet committee chaired by the Prime Minister.[354]

Gerry Mangan, Government of Ireland

To start, the Combat Poverty Agency is a state agency. It was set up by statute in 1986, so we're over 20 years old. Within the European Union it's a fairly unique organization; there isn't an organization in any of the other member states that would have a similar role set up by statute.

Under the act setting us up, we have four key functions: the first is to give policy advice to the minister and to the government on social and economic planning in relation to poverty; the second is to undertake and evaluate programs and actions aimed at overcoming poverty; the third is to promote, commission, and undertake research into the nature, causes, and extent of poverty; and the fourth is to promote a greater understanding of poverty through communications and public education.

These functions would include working with the NGOs and the community and voluntary sector in Ireland and also promoting the use of community development as a way of overcoming poverty.[355]

Kevin O'Kelly, Government of Ireland

When it was first introduced, Ireland’s National Anti-Poverty Strategy addressed five major themes: educational disadvantage, unemployment, income inadequacy, disadvantaged urban areas, and rural poverty.[356] In 2006, Ireland introduced Towards 2016,[357] a social partnership agreement that provided a foundation for addressing key social challenges, followed by a National Development Plan in 2007,[358] which outlined the resources and investments that would be used to achieve these aims and improve quality of life in Ireland. Together with these framework documents, Ireland’s National Action Plan for Social Inclusion 2007-2016 outlined Ireland’s commitment to addressing poverty and social exclusion, and the actions that would be taken in this area. The National Action Plan includes the target of reducing consistent poverty to between 2 and 4% by 2012 and eliminating it entirely by 2016.[359] With earlier income support targets having been achieved, the new plan places greater emphasis on the role of services and employment in achieving these objectives.[360] Witnesses explained this new approach.

We adopted a life cycle approach to try to promote greater integration. Our life cycles are children, people of working age, older people, and other categories such as people with disabilities, and communities. We then set goals for each life cycle. For example, in relation to children, we have goals for education and income support. In relation to people of the working-age category, we have employment participation, income support. For communities it was deemed to achieve greater policy coordination and integration.[361]

Gerry Mangan, Government of Ireland

The National Action Plan aims to ensure that children realise their potential. The key goals targeting children are based on education and adequate income support. The government’s action plan also includes provisions for people of working age, with a focus on employment and income support.[362] Other key areas of action include literacy, health, and restorative justice.[363] Another aim of the plan is to increase employment among people with disabilities who are able to work. Government actions are focused on income support; access to buildings, infrastructure and transportation; and housing and accommodation for this population group.[364] The final lifecycle group targeted in Ireland’s most recent social inclusion plan is seniors. To enable older people to maintain their health and well-being and live active and full lives, the government stated it would increase investment in community care services and maintain a minimum level of income support through the pension system.[365]

The measures specific to the groups outlined above are supplemented by more general programs that support disadvantaged communities. The main goals that have been identified in this area focus on health, housing, and the integration of newcomers. Also in this category are initiatives to tackle issues such as homelessness, fuel poverty, access to technology, financial inclusion, and illicit drugs.[366]

Ireland’s anti-poverty strategy was highly successful for the first ten years. The key to this success was the growth of the Irish economy, which allowed the country to make substantial investments in its social protection system. Between 1997 and 2007, the basic rate of social welfare support increased by 123.7% and spending on social protection went from €5.7 billion to €15.3 billion.[367]

In the Irish context, for reasons I won't go into because they're quite complicated, it's not a single-factor explanation for what happened in terms of what's often called the Celtic Tiger, but the unemployment problem was tackled and solved, with the rate falling from 15% to 5%. That's the first part of the action, but in the second part of it, there are substantial increases in welfare payments, in the first place, for those of pension age, and at a later stage, for other rates of welfare payment. With that combination of scenarios, there have been significant reductions in poverty on the usual measures in Ireland.[368]

Tim Callan, Economic and Social Research Institute

These resources helped to lift a significant number of people out of consistent poverty over the decade. Trends indicate that the poverty reduction target for 2007 would have been reached, with less than 2% of the population in consistent poverty that year.[369] Witnesses, however, explained that the reductions in poverty observed over this period were felt differently across population groups.

On that basis [of consistent poverty], the latest figures that we have for 2006 show an increase in child poverty and poverty among lone parents. These are obviously related. But we've also seen a decrease, for example, in poverty among older people, as I mentioned earlier, and also among immigrants, who may have come here after the accession of central and eastern European countries to the European Union in 2004. They seemed to be living in poverty in 2005, but in fact that level dropped quite substantially in 2006. So it's a mixed picture; we're seeing progress in some areas and difficulties in other areas.[370]

Kevin O'Kelly, Government of Ireland

Until 2008, Ireland continued to make progress towards its new goal of reducing the rate of consistent poverty to between 2% and 4% by 2012 and eliminating it entirely by 2016. According to the Survey on Income and Living Conditions (SILC), in 2008, 4.2% of people lived in consistent poverty in Ireland, down from 5.1% the year before and 6.5% in 2006.[371] People who were unemployed saw their risk of consistent poverty fall dramatically from 17.5% to 9.7% between 2007 and 2008, a decrease of almost half. Those who were working or retired enjoyed a much lower risk of consistent poverty at 1.1%. Children continued to have the highest rate of consistent poverty of all age groups, at 6.3%. Other groups with relatively high rates of consistent poverty included those who did not work due to an illness or a disability (13.2%), people in lone-parent households (17.8%) and people in non-working households (13.2%). In all of these cases, however, the consistent poverty rate had fallen since 2007.[372] Ireland also continued to see rapid employment growth until early 2008, with 70,000 new jobs created in 2007 alone.[373]

While the progress outlined above is encouraging, the global economic and financial crisis has disrupted Ireland’s poverty reduction and social inclusion efforts. Ireland was one of the first countries in Europe to enter recession in 2008 and has been particularly impacted by the downturn.[374] Data reveal that Ireland’s unemployment rate has risen consistently since early 2008 when it sat at 4.8% to reach 12.6% in February 2010.[375] The unemployment rate is expected to peak at almost 14% this year.[376] In addition, Ireland’s public debt is mounting and could reach 78% of GDP by 2010. This limits Ireland’s ability to counter the economic downturn with stimulatory fiscal policies.[377]

In the most recent review of the National Action Plan for Social Inclusion, the minister responsible for the plan indicates that “[t]he economic and employment assumptions on which the National Action Plan was originally based are...to a significant degree no longer valid”.[378] Ireland’s most recent budget, released in December 2009, announced a 4.1% reduction in social welfare rates, as well as cuts to the Child Benefit, Job-seekers Allowance and Supplementary Welfare Allowance.[379] Ireland has announced, however, a framework plan to address current economic challenges and reorganise the economy over the next five years.[380] Restoring economic growth has been identified as the most important step moving forward.[381]

Representatives who appeared before the Committee acknowledged the challenges the country is facing.

We're under no illusions; meeting these targets will be extremely difficult. We have two particular challenges. The first is the downturn of the global economy and the impact it will have on the Irish economy, which is a very open economy in international terms. We won't have the resources we've had over the last 10 years to direct towards tackling poverty.

The second point is that we're trying to reach these targets in an expanding population. Our statistics office estimates that in the next eight to 10 years, the population will increase by about 20% to well over 5.2 million, and to reduce poverty in an expanding population will in fact be a major challenge for us. We're not under any illusions about that.[382]

Kevin O'Kelly, Government of Ireland

c. Summary

The UK and Ireland both developed poverty reduction strategies in the late 1990s. They adopted multi-pronged approaches to tackle poverty and social exclusion with clearly defined goals, specific indicators, and precise timelines, and they supplemented their strategies with multi-year action plans and dedicated resources. Since making the commitment to reduce poverty, these countries have seen progress on a variety of indicators. This can be attributed in part to strong economic and employment growth, improved tax benefits and income support, and an array of programs and policies to facilitate labour market participation. In recent years, however, some of this progress has stalled or reversed, and the consequences of the global economic recession of 2008-2009 will hinder their poverty reduction strategies going forward. Both the UK and Ireland have identified economic recovery as an immediate priority while continuing to focus on tackling deep-seated social exclusion and breaking the cycle of poverty. Witnesses from both countries identified the need to learn from past efforts at poverty reduction and adopt a broad understanding of poverty and social exclusion to address the root causes of these problems.