8. Plaid Cymru Debate: Low-income Families

Part of the debate – in the Senedd at 6:13 pm on 8 January 2020.

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Photo of Leanne Wood Leanne Wood Plaid Cymru 6:13, 8 January 2020

Diolch, Llywydd. Wales has one in three children living in poverty, and this figure is rising, and this is a damning indictment of the impact of the Conservatives’ cruel austerity agenda and consequent cuts to welfare, and 20 years of inefficient governing by Welsh Labour. The Institute of Fiscal Studies have indicated that, if nothing changes, the child poverty figure is likely to increase to 40 per cent of all Welsh children living in poverty by 2020—that's this year—with welfare reform a significant factor.

Whenever radical proposals to tackle this are put forward, the reaction of conservatives, in both the Conservative Party and the Labour Party, has been the rhetorical demand of, 'How much does this cost?' A question with the subtext of, 'How much are you going to tax my large income to pay for the scheme for poor people?' So, it's worth laying some context for this first. Poverty costs Wales £3.6 billion of public spending on its consequences every year. For example, spending on health and social services deals with the illnesses that are caused by poverty. And, of course, the cost of paying £35 per week to every child in a low-income household will vary depending on how we define low income and how focused and targeted we need to be. With an estimated 200,000 children living in poverty, giving the payment to all children in poverty would be around £364 million a year, although other options to define eligibility could see that bill drastically increase or reduce.

At the present moment, we want to be keeping all of the options on the table, because we want to reduce child poverty, and as long as we lack powers over the administration of welfare, we would, of course, need to negotiate with the Department for Work and Pensions so that the cash payment wasn't simply removed from other benefits—and I wouldn't be surprised if that particular department was vindictive enough to do just that. But, the principle of topping up the incomes of the lowest earning households is one that should have a political consensus, based on the evidence of its effectiveness.

Some sections of the UK media have been running a relentless propaganda war to convince people that the economic problems that they face are either the fault of immigrants or the undeserving, feckless poor, as opposed to Wall Street creating credit default swaps. Topping up the incomes of low-income families works. Even the right-wing American magazine The Atlantic supports this principle, and it argues: 

'In many cases, cash programs are simply much more effective than in-kind transfers at turning dollars spent into positive...outcomes.'

Neither do any of the programmes evaluated from around the world find that cash payments result in increased tobacco or alcohol use, as the prejudiced propaganda would always have people believe. The evidence shows that these programmes are cheaper than the alternatives. So, it turns out that the cheapest and most effective ways of tackling the problems caused by low incomes is to make those incomes higher. Who would have thought that? So, with Wales experiencing the highest rates of child poverty in the UK, and 20 years of failed initiatives and limitations in what Wales should have been doing, isn't now the time for a radical change in our approach? Plaid Cymru thinks it is.