A taxation and benefitssystem to end child        poverty  Whose economy? Seminar  11 November 2010       www.cpag.org.uk/...
A taxation and benefits system toend child poverty   •   Whose economy now? Child poverty       and our current system   •...
CPAG in Scotland   •   Raising awareness   •   Influencing policy   •   Maximising family incomes
Whose economy now? Child povertyand our current system   •   260 000 (1 in 4) Scotland’s children       officially recogni...
New challenges   •   £18 billion cuts to welfare, including:       − Uprating using CPI not RPI       − Child benefit froz...
New challenges   •   “tax and benefit changes are regressive       rather than progressive across most of       the income...
What’s worked?Real progress:Child poverty fell by 600 000, in Scotland 100 000Why?•   Defining child poverty and setting t...
What’s not worked?   •W2W agenda: unbalanced approach to rights   and responsibilities, and too often failed   •Over-relia...
What would work: a tax and benefitsystem to end child poverty
Benefits: Manifesto for Change    Scottish Campaign for Welfare Reform•   • Increase benefit rates to a level where no one...
Increase benefit rates•benefits should match Minimum IncomeStandards, what public think is theminimum required to enable a...
Respect for human rights       and dignity•urgently review ESA and changes madeto move lone parents off income support•   ...
Radically simplify the     welfare system•Harmonise the tax credits and benefitsystems, as much as possible, so thatpeople...
Invest in support needed•Make employment in benefit and jobseeking services more fulfilling andbetter rewarded• Give guara...
Suitable for Scotland•   Ensure that all welfare system takes    account of the different legislative    framework in Scot...
Taxation to end child poverty   •Make tax policy more progressive.   proof taxation decisions for their   redistributive e...
Conclusion   • Progress on child poverty had stalled even   before the economic crisis.   • If serious about an economy th...
To view all the papers in the Whose       Economy series click hereTo view all the videos and presentations       from the...
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A Taxation and Benefits System to End Child Poverty - John Dickie

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John Dickie, head of the Child Poverty Action Group Scotland, talks about how a different taxation and benefits system can help end child poverty.



The Whose Economy? seminars, organised by Oxfam Scotland and the University of the West of Scotland, brought together experts to look at recent changes in the Scottish economy and their impact on Scotland's most vulnerable communities.

Held over winter and spring 2010-11 in Edinburgh, Inverness, Glasgow and Stirling, the series posed the question of what economy is being created in Scotland and, specifically, for whom?

To find out more and view other Whose Economy? papers, presentations and videos visit:
http://www.oxfamblogs.org/ukpovertypost/whose-economy-seminar-series-winter-2010-spring-2011/

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A Taxation and Benefits System to End Child Poverty - John Dickie

  1. 1. A taxation and benefitssystem to end child poverty Whose economy? Seminar 11 November 2010 www.cpag.org.uk/scotland
  2. 2. A taxation and benefits system toend child poverty • Whose economy now? Child poverty and our current system • Progress to date: What’s worked and what’s not worked? • Looking ahead: a tax and benefit system to end child poverty
  3. 3. CPAG in Scotland • Raising awareness • Influencing policy • Maximising family incomes
  4. 4. Whose economy now? Child povertyand our current system • 260 000 (1 in 4) Scotland’s children officially recognised as living in poverty (2008/09) •undermining their health, education, life chances and childhoods • unusually high child poverty • And all this before 2010 Budget and CSR assault on family incomes…..
  5. 5. New challenges • £18 billion cuts to welfare, including: − Uprating using CPI not RPI − Child benefit frozen, and restricted − New DLA assessment to cut £1.1b − Contributory ESA limited to one year − Council tax benefit reduced by 10% − Housing benefit reductions, caps and restrictions − Cuts to child tax credit −Cuts to working tax credit − Health in Pregnancy grant scrapped − maternity grant restricted to first child
  6. 6. New challenges • “tax and benefit changes are regressive rather than progressive across most of the income distribution” (IFS) •Treasury’s analysis shows both welfare cuts and public service cuts announced regressive •families in bottom 40% incomes drop by over 5% by 2012/13, with drop of 7% for poorest (IFS) − Britains top 1000 saw collective wealth increase by £73billion in year to 2009/10
  7. 7. What’s worked?Real progress:Child poverty fell by 600 000, in Scotland 100 000Why?• Defining child poverty and setting targets•Benefits: tax credits and increases to universalchild benefit• Labour market: NMW, in work support• Services: investing in early years and childcare
  8. 8. What’s not worked? •W2W agenda: unbalanced approach to rights and responsibilities, and too often failed •Over-reliance on work. Increasing in-work poverty. • Stigmatising language eroding public support • Problems with complexity, take up, administration and adequacy of benefits • Failure to tackle underlying inequality • extraordinary inequality in pay distribution • a tax system allowing the wealthy to accumulate…whilst the poorest pay disproportionately more
  9. 9. What would work: a tax and benefitsystem to end child poverty
  10. 10. Benefits: Manifesto for Change Scottish Campaign for Welfare Reform• • Increase benefit rates to a level where no one is left in poverty and all have sufficient income to lead a dignified life• • Make respect for human rights and dignity the cornerstone of a new approach to welfare• • Radically simplify the welfare system• • Invest in the support needed to enable everyone to participate fully in society• • Make welfare benefits in Scotland, suitable for Scotland.•http://www.cpag.org.uk/scotland/SCOWR-Manifesto.pdf
  11. 11. Increase benefit rates•benefits should match Minimum IncomeStandards, what public think is theminimum required to enable an individualto meet their needs and live with dignity• those who are ill or disabled should getadditional help to cover the extra costsincurred through ill health.
  12. 12. Respect for human rights and dignity•urgently review ESA and changes madeto move lone parents off income support• Support carers by up rating Carers Allowance to Minimum Income Standards•Make benefit and job seeking servicesaccountable at a local level to serviceusers
  13. 13. Radically simplify the welfare system•Harmonise the tax credits and benefitsystems, as much as possible, so thatpeople can move in and out of workwithout financial disruption• Substantially up rate the earnings disregard to remove barriers to paid employment•Extend universal benefits, e.g. makingchild benefit pay equally for every child - simpler, easier to administer and without stigma than means testing
  14. 14. Invest in support needed•Make employment in benefit and jobseeking services more fulfilling andbetter rewarded• Give guaranteed access to a well resourced wide range of employment services to all those who are seeking work, including non claimants• Invest in free or affordable, accessible,high quality childcare focused on thewellbeing of the child,
  15. 15. Suitable for Scotland• Ensure that all welfare system takes account of the different legislative framework in Scotland and is integrated with devolved childcare, education, training provision.
  16. 16. Taxation to end child poverty •Make tax policy more progressive. proof taxation decisions for their redistributive effect. • Increase the role of income tax • Reduce VAT consumption tax • Tax unearned wealth transfers such as inheritance • Review council tax, but replacement must be both fairer and raise necessary resources for local services.
  17. 17. Conclusion • Progress on child poverty had stalled even before the economic crisis. • If serious about an economy that will end child poverty we can’t just return to where we were. • The welfare benefit system must be mended; and greater use made of universal benefits in tandem with progressive taxation. • We need to move away over-reliance on means testing of benefits for those at the bottom and the unfettered accumulation of excessive wealth at the top. • Will also require a different kind of labour market with more equal pay distribution.
  18. 18. To view all the papers in the Whose Economy series click hereTo view all the videos and presentations from the seminars click here

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