DOING SOMETHING ABOUT POVERTY

The poor are now younger and more able-bodied than

before. Ferdinand Mount discusses ways for the Government

to meet the Prince of Wales's concern for the inner cities

THE girl in the pink dress was standing behind the push-chair at the foot of the stairs to the Piccadilly Line. At first, I thought she was holding out some small object to the baby, but the baby lay low and did not move. As I came to the bottom of the stairs, I saw that her hand was empty and she was holding it out to me. Her dress was clean and her hair brushed shiny. She must have been about 16.

The shapes of modern poverty, in Lon- don at any rate, are more confusing than they were before the war or even 20 years ago. The bleak unrelieved misery of a whole town or region is not to be found in the South now, or in many parts of the Midlands, or even in parts of the North, such as Cheshire and small-town Lan- cashire. What we see is mostly relative poverty made painfully conspicuous in the midst of plenty, not the absolute but shared poverty of the 1930s. That is not comfort, nor is it any guide to the right answers. Why are teenage mothers begging when benefits have been higher in real terms? Why are unemployment totals so obstinately high when the number of vacancies is at record levels? Why are so many people still officially classified as homeless when there is not such a large surplus of dwellings over households and when record amounts are being spent on renovation and indeed on housing benefit?

The Left says simply, to adapt Ernest Hemingway putting down Scott Fitzgerald, that the poor are different from us because they have less money. The Right says that the poor are 'demoralised' — a useful word which elides loss of morale with loss of morality and leaves the speaker free to wander between the two in explaining poverty.

It cannot be said that even the best intentioned poverty lobbies shed all that much light on the subject. In Homes Above All, Des Wilson and Sheila McKenzie, the

first and the present directors of Shelter, try to do justice to the huge improvements in housing standards that have taken place over the past 20 years, but their principal remedy for the homeless and for the insanitary and overcrowded housing that remains is simply a huge revival of house- building by local authorities. Whatever else may be part of the answer, it is by now pretty clear that council estates are part of the problem.

None of these approaches seems to take much account of recent history or to try to base policy on any clearly conceived idea of the causes or nature of poverty now. This is odd when poverty in the broadest sense, if only under the sobriquet of 'the inner cities', has become the issue of the day, the issue to which all political con- versation keeps on coming back, the issue Which Mrs Thatcher on the staircase of Conservative Central Office in the small hours after her election victory identified as the prime challenge of her third adminis- tration. All the same, I doubt whether it is the issue closest to voters' hearts. In fact, I think poverty remains a strangely opaque subject to non-political people because the political world has so far failed to define it With anything approaching clarity. Who are the poor now? The most start- ling fact about the poor today is that they are on average so much younger than they used to be. The other way of putting it is that poverty in old age has been declining, slowly at first but quite rapidly in the last decade or so. In 1971, more than half the Poorest 20 per cent of households were Pensioners. By 1982, only about a quarter were pensioners. By contrast, the propor- tion who were single people of working age had risen from 19 to 34 per cent; house- holds with children (one-parent and two- parent together) had risen from 22 per cent of the poorest group to 30 per cent over the same period. The numbers of people draw- ing supplementary benefit have risen sharply during the 1980s from 21/2 million to nearly five million, partly because of unemployment and partly because real improvements in benefit have raised the 'poverty line', but the number of pension- ers claiming benefit has been falling, although Britain's pensioner population has gone up by nearly a tenth. This noteworthy progress towards the unhoped serene, instead of the sans everything (especially sans cash) experience of our forefathers, is mostly due to the improve- ments in the real level of retirement pensions over the 40 years of the National Insurance scheme. What is less often re- marked is the growing amount of private savings that the majority of people retiring can now draw on, as opposed to the general condition of retirement to near destitution after the war. Mr John Mac- Gregor, then Chief Secretary to the Treas- ury, told the Commons earlier this year that the proportion of people retiring with occupational pensions went up from 41 per cent in 1973 to 51 per cent in 1985. More tellingly perhaps, about three-quarters of pensioner households now have some in- vestment income.

The idea of poverty being predominantly a condition of the young is unfamiliar and upsetting to us in Western Europe, although familiar enough in the Third World. Neither public provision nor public sympathy for unmarried mothers and sick or abandoned children is new. Mediaeval almshouses were often full of deserted wives and children; foundling hospitals were among the earliest institutions of public charity; no modern social worker Could have shown more sensitivity than Dick Whittington, when in his benefaction

to St Thomas's Hospital he 'made a new chambyre with viii beddys for young wemen that have done-a-mysse, in trust for good mendement. And he commandyd that alle the thynges that had ben don in that chambyre shoulde be kepte secrete, for he wolde not shame no yonge woman in noo wyse.' In 'The Bridge of Sighs', Thomas Hood was appealing to a well established popular sympathy (as was George Moore in Esther Waters, and in- deed Hardy in Tess) with the victims of heartless seducers:

One more Unfortunate Weary of breath, Rashly importunate, Gone to her death.

The helplessness of the unmarried mother and her baby, if it survived, re- quired little imagination to understand. The helplessness of able-bodied young men in certain circumstances to find a home or a job has not generally been so obvious. The general attitude to 'sturdy beggars', now as in Tudor times, is 'on yer bike'. If the spectacle of poverty is to touch the conscience and stir the political and financial energies of the middle classes, it must, it seems, be associated with physical weakness and with squalid conditions like- ly to lead to ill health.

The Prince of Wales's encounter with the Bengalis in the Spitalfields sweatshop is a classic demonstration of this. The two essential points, (a) that they were working in these frightful places, not living in them, and (b) that they were working, did not begin in his eyes to outweigh their fright- fulness. The Prince's quest for slums re- minded me a little of the Left's quest for injustice at the Grunwick factory. The 'I don't know why they're making such a fuss, this is a very nice inner city.' Indian women packing films for Mr George Ward may not have been brilliant- ly paid, but they did not seem to think of themselves as being exploited, nor to be over-eager to be enrolled in a trade union.

But the major social problem is surely not the people who are working and who have a quite clear purpose in life, viz, to work their way out of the sweatshop and into a decent house in Hendon, as the Jews did before them. The problem is the people who have no job, no purpose in life and no practical skills and not much expectation of acquiring any of these things. How have they come to be shut out of 'useful society' — or to regard them- selves as shut out, which often comes to much the same thing?

Modern poverty is not a reflection of incapacity. The majority of people now classified as living in absolute or relative poverty are not mentally or physically incapable of earning a wage good enough to support a family and a home. Nor does the .British economy lack the capacity to offer them homes and jobs. On the con- trary, a much poorer economy could em- ploy and house all these people quite adequately. It is only when we think of poverty today as a result of exclusion rather than incapacity that we may make some progress.

The crash utopian programme. The sim- plest way to justify these sweeping asser- tions is to imagine a dictator who had benevolent intentions and some rudimentary understanding of economics but was also a rather tactless and insensi- tive person — a sort of David Owen with knobs on. Having come to power with a promise to abolish poverty and unemploy- ment within the year, how would he proceed?

Well, he might start by abolishing all planning restrictions and also declare, with the generous agreement of the Royal family, that all royal parks and estates were henceforth public building land open to all who lacked a roof over their heads. In no time, chalets would mushroom over the grounds of Highgrove as the Bengalis took Prince Charles's offer of help literally. Other ill-housed immigrants would soon do the same in the policies of Gatcombe and Nether Lypiatt. Their children, would grow up strong and healthy in the Cots- wold air. The rural economy of Glouces- tershire would be immensely invigorated, restoring to the country some of its former mediaeval glories in the textile trades. It should be said, en passant, that in order to make housing genuinely cheap, our dicta- tor would probably suspend the Parker Morris housing standards, at the risk of offending the shade of Roy Jenkins's late father-in-law.

The price of building land would plum- met, the rate of house-building would soar, probably far beyond Harold Macmillan's 300,000 houses a year. Some of the houses might be a little tacky, others would have a rustic charm; the total effect would certain- ly be far more attractive than Broadwater Farm or the Liverpool Piggeries.

Businesses, large and small, would multi- ply, much of it in the South no doubt, but the boom would certainly spread to the Dales and the Peak District. Jobs would multiply, and employers in southern Eng- land would at last be able to fill all their vacancies, since workers in the North would now be able to buy or lease their chalets for a song or build them with their own hands on a pleasant and convenient site. Charitable institutions and building associations would be able to build thousands of special cottages for the sick and the disabled.

Something a little more modest. Alas, I am afraid that such utopian schemes would annoy too many people and frighten the horses. The shortage of homes and job, like the shortage of building land, is entirely artificial, but no solution which releases the poor and unemployed into the countryside in such large numbers is likely to find political favour. We must proceed more delicately in our efforts, but not lose track of the initial insight that the poor are kept poor because the rules exclude them, not because they are too weak to look after themselves, given a little bit of help. This is the guiding principle behind Lord Young's more enlightened schemes when he was at the Manpower Services Commission and later at the Department of Employment. The same principle is at work in the proposals for city technology colleges, housing trusts to replace council own- ership, urban development corporations — the belief that the run-down parts of the cities can best be revived by offering opportunities rather than by imposing fresh patterns of administration.

The same objection is raised to all such proposals, namely, that they may perhaps help those people who are blessed with the energy to clamber out of the working class, but they will do nothing for and may even harm the 'hopeless poor', the demoralised and apathetic people left behind. Mrs Thatcher retorts that more people will respond to such opportunities than the pessimists think.

All the same, let us assume that the hopeless poor, the left-behind class, re- mains quite sizeable. How are the young and able-bodied but apathetic and ill- equipped to be helped up off the floor? 1 offer a few simple suggestions. The net cost to the Exchequer of most of them is negligible, or can be made so.

Family support. The system of family allowances has never fulfilled the wartime reformers' hopes; nor did its amalgamation with the child tax allowances under the last Labour government. If child benefit, now £7.25 a week, is to lift low-income or no-income families out of poverty, it will have to be much nearer the level of similar benefits on the Continent, and closer to the British supplementary benefit allowances for older children, now standing at over £15 a week — which naturally makes supplementary benefit more attractive and self-help less so.

Labour's proposal to go part of the way by raising child benefit by £3 a week would cost nearly £2 billion. The comprehensive reform of personal tax needed to pay for this seems less and less politically realistic.

The best alternative, I think, is to develop a two-tier system of family sup- port, with child benefit for all, and a generous family credit for poor families on top. The Fowler scheme which will replace the Family Income Supplement next April is expected to double the 200,000 families currently receiving FIS at a cost of around £200 million. But the scheme still looks too modest. Since the poverty and women's lobbies have once again successfully re- sisted the proposal to pay the credit through the pay packet, take-up will de- pend on mothers applying for the extra credit and may be no higher than 60 per cent of those eligible. It should not be beyond the wit of the Inland Revenue to devise a scheme by which they administer the credits and then send them direct to the mother, who cashes them at the post office along with her child benefits.

Raise the rates, extend the 'taper' (the rate at which benefits are reduced as you go up the income scale), and you could have a comprehensive safety net to relieve poverty in childhood for another £200-300 million (or for nothing, if you prefer to tax away an equivalent amount of child benefit from the top echelons of taxpayers). What else is computerisation of the Inland Re- venue for, if not to give effect to our ideas of justice at the press of a button?

Cheap housing. Bring back that tradi- tional figure of mystery and romance, the lodger, by abolishing income tax on the income from small lettings up to £60 a week (or £100 a week if you are feeling bold), and so unleash on the market a fresh supply of attics, basements and annexes. This is an Alliance proposal, which should not prevent Mr Lawson from swallowing it, since it would cost the Treasury little or 'Exactly where did this Jack Homer put his thumb?' nothing.

For his part, Mr Ridley can come out from hiding now. The Alliance gained no seats in southern England, and the way is clear for him to adopt a much more relaxed approach to planning permission for house-building — the key to the whole business (see the suggestions in 'The New Song of the Land', Spectator, 10 January). In areas of housing shortage, he could allow councils to use receipts from the sale of council houses to finance short-life housing developments, on condition that they leased or sold the houses either to housing associations and building societies or to the people who were going to live in them; this would be something of a return to the spirit of the Artisans' Dwellings Acts of the 19th century, under which boroughs usually received grants and loans to do everything to house the poor, short of wholly owning the homes themselves, both Tory and Liberal governments then having a strong sense of the importance of spread- ing property rights. Municipal enterprise, not municipal socialism. For much less than it costs to keep her in a bed-and- breakfast, a single parent could have a 211-year lease on a small flat, with an option to buy the freehold or to sell the lease after, say, three years — a modest stake in the country.

Worklure. Almost the strongest tenet in British welfare politics is the fear of 'another Speenhamland'. Under that sys- tem, or so our history books taught us, benighted Berkshire magistrates at the end of the 18th century wrongly subsidised the wages of the poor out of the rates, with the disastrous result that employers drove wages downwards and pauperised their workers, who became permanently depen- dent on welfare.

These days, the poverty trap operates differently. The small increase in income (for some men with families, the actual decrease) to be gained from working as opposed to not working makes people, especially the young and single, reluctant to take up low-paid jobs. This in turn makes employers reluctant to go through the bother of offering such jobs. For the first years of mass unemployment, the poor were left to sort out this dilemma for themselves. They were offered no incen- tives, put under no pressures. Since David Young arrived at the MSC, all this has changed in the direction of a more pastoral approach. The Government now offers advice, incentives and, in the case of the under-18s, a sharp prod. Through the Enterprise Allowance, the Government now subsidises for a year unemployed workers who are setting up their own business and under the Jobstart scheme it makes a top-up payment of £20 a week for 6 months to long-term unemployed work- ers who take a job paying £80 a week or less. Could this anti-Speenhamland spirit be taken a stage further, so that everyone coming off the dole into a low-paid job receives a temporary top-up allowance to make work more alluring? Not so much Workfare as Worklure.

All these schemes — and there are no doubt dozens of other possibilities — might Offer something to the hopeless poor, since they would not depend on people showing tremendous initiative but on them merely taking advantage of what is there, a low- voltage sort of self-help.

The metaphor used to describe the poor or the underclass who are left behind by modern society — the 'sump', the 'sink' — are unwitting descriptions not so much of

the individual victims as of the system which encourages them to settle at the bottom and makes the sides so steep and slippery that only the more agile can climb up out again. The first batches of opportu- nities offered by the Thatcher governments — buying your own council house, starting up your own business, setting up your own pension scheme, voting for your school to opt out — do, it is true, require quite a bit of initiative to embark on I hope that the next batch will be just as ambitious in their aspirations but rather less ambitious in their demands.