Tackling pay and employment to address poverty

There's no credible evidence to support the claim that members new to the government following last week's reshuffle were issued with protective helmets when they received their brief, but it does seem that there is a constant barrage of criticism for a government that appears to be failing in ensuring the most fundamental characteristics of a developed, industrial economy are met. It almost induces some sympathy for the new ministerial teams - well, no, it doesn't really.

In the middle of last week the World Economic Forum announced that the UK has moved up in the world competitiveness rating, from 10^th to 8^th, based on labour market 'flexibility' and 'business innovation'; progress that identifies the UK as a better place to do business. It is disappointing then that this is not reflected in any significant business investment from any apparent source.

The WEF report was accompanied in the timing of its publication by the launch of a Save the Children appeal, a group more widely recognised, to raise cash to support children in poverty in the UK. As a result of the response to the recession, the austerity economics of the current government, more and more families are desperately struggling to make ends meet. Around two thirds of families in poverty have cut back on food, one fifth of adults in poor households regularly miss meals; one fifth of poor parents can't afford to buy their children shoes; 80 per cent need to borrow money, vulnerable to high interest rates and loan sharks.

The high level of unemployment is a key factor. While the official rate of unemployment is bad enough, a report from Sheffield Hallam University last week confirmed that these official statistics significantly under-represents the real number of people out of work, by over 100,000 in the north east. With further benefit cuts likely the struggle looks likely to get harder for families in these circumstances.

The government's response to the Save the Children appeal was to suggest the focus needs to be on tackling worklessness. No-one would argue that there is a clear and present need to develop more employment and economic growth; despite the WEF report there is no cause for optimism that this will be witnessed any time soon, in fact, the government's own advisors suggest quite the opposite.

Those in work, however, are also making stark choices between heating and eating. A massive 61 per cent of children in poverty are in households with one or more working adults. As a TUC report showed last week the number of people working part-time who want full time work has increased by over 45 per cent in the north east, while wages are generally stagnating across all sectors.

As well as creating employment, tackling low pay, through the application of a 'living wage' instead of the current, insufficient national minimum wage, also matters in tackling poverty and enabling people to enjoy a minimum standard of quality of life.

Kevin Rowan

Regional Secretary

Northern TUC