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Poverty in Wales – a failure of devolution?

May 15th 2019

Twenty years on from the opening of the National Assembly for Wales poverty remains as great a problem as ever. Steffan Evans looks at what’s gone wrong over the past twenty years.

One of the flagship policy objectives of successive Welsh Governments over the period of devolution has been to end child poverty. Since the turn of the decade we’ve seen the enactment of Welsh legislation and the publication of various child poverty strategies. Despite these actions and a stated ambition to end child poverty in Wales by 2020, 29% of children still live in poverty. What have been the reasons behind this failure?

Power devolved is power retained

The aim of ending child poverty by 2020 was always ambitious. There are three primary drivers of poverty:

  • Work not providing workers with enough income to enjoy a decent standard of living
  • The social security system not providing families with enough support
  • High costs of living, especially housing costs

With the UK Government retaining control over significant aspects of these drivers, ending child poverty in Wales by 2020 was always an unrealistic ambition if the UK Government did not share the same commitment. There are things that could have been done differently closer to home, however.

Too focused on work?

In the twenty years since the opening of the National Assembly, much of the focus of attempts to solve poverty have been on increasing employment. These measures alongside developments at UK level appear to have had some positive impact, with the historic gap between economic activity rates and employment rates in Wales and the rest of the UK having now disappeared. This improving picture has not fed into any significant reduction in both the number and proportion of people living in poverty, however.

One of reasons for this is that whilst being in work significantly reduces a person’s risk of being in poverty, it does not remove that risk completely. Most people who live in poverty in Wales live in households where at least one adult is in work. 64% of working age adults and 67% of children who live in poverty live in such households. It is perhaps fair to question whether the approach taken in Wales since devolution has been too focused on boosting employment as opposed to tackling the issue in the round?

Lack of joined up thinking

Not only could it be argued that Welsh Government policy has been too focused on increasing employment over the past two decades, it could also be argued that there have been too many occasions where policies have not been working in harmony. As noted above, one of the key drivers of poverty are high living costs, especially housing costs. The continued commitment we have seen to boosting the supply of social housing in Wales over the era of devolution, be this through the abolition of the right to buy or through the Welsh Government’s more recent commitment to build 20,000 new affordable homes is therefore to be welcomed.

Over the same period, however, the Welsh Government’s rent setting mechanism has permitted social landlords to increase their rent above inflation, leading to social rent becoming increasingly unaffordable for thousands of families across Wales, undermining some of the potential benefits of the construction of new social housing. This was an issue discussed at the Bevan Foundation’s recent seminar on affordable rent with Shelter Cymru. Ensuring that social rents are affordable for all must underpin any rent setting policy developed in the wake of the Independent Review of Affordable Housing if we are serious about solving poverty in Wales.

A Lack of ambition

Whilst the Welsh Government may have been guilty of being over-ambitious in setting a target of ending child poverty by 2020, in other areas it has not been ambitious enough. An example of this can be found in the Welsh Government’s approach to holiday hunger. Thousands of children and their families are at a risk of holiday hunger despite the presence of good quality local schemes and the introduction of the School Holiday Enrichment Programme (SHEP), which is funded by the Welsh Government.

The Welsh Government’s approach to dealing with this problem to date has been wholly inadequate. In 2018, only 2,500 children received support through SHEP. In their 2019/20 budget the Welsh Government allocated an extra £0.4m to SHEP, enough funds to support an extra 1,500 children. Whilst the support provided by SHEP is excellent, the number of children supported are tiny compared with the 76,200 who are eligible for free school meals and the additional 55,000 school age children who live in poverty but who are not even eligible for free school meals. As we highlighted in our new report Kids on the breadline: Solutions to holiday hunger relatively modest investment could significantly increase the number of children who are helped.

Solving poverty in Wales

There is clearly more that could be done in Wales to solve poverty and the scope for this could be increased further if powers over aspects of the social security system are devolved. The Bevan Foundation will continue to press the Welsh Government to take action to end poverty. Recently we started work on a new project looking at the support schemes that are available for low income families in Wales.  We believe that this work could have a significant impact on how low-income families in Wales are supported. But we can’t do that without your support to spread the word, provide much needed funds and be part of the debate. To help us do the same and more in the next chapter of devolution, sign up here.

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