Session 1: Child poverty outcomes and main factors behind International benchmarking and key challenges for Member S

1. Child poverty and child well-being: better monitoring for better policies Brussels, 26 November 2009 Session 1: Child poverty outcomes and main factors behind International benchmarking and key challenges for Member States András Gábos TARKISocial Research Institute

2. International benchmarking and key challenges for each Member State • To assess the performance of countries in the field of child poverty (and well-being) relative to • The national average/adult population • The EU-average • Following the EU Task Force (2008) methodology • Four dimesions: 1 on outcome side and 3 on determinant side • Child poverty risk outcomes • Joblessness • In-work poverty • Impact of social transfers • Other aspects (material deprivarion, housing, non-material well-being) are also dealt with in the Study

3. Poverty among children, in general, is higher than that of the overall population • Every fifth child is at-risk-of-poverty in the EU-27 • Child poverty is specifically high in the two newest MSs: BG and RO • Much higher than the population average: CZ, HU • Lower than the population average in: DK, DE, EE, CY, SI, FI ----------------------------------------- • The severity of poverty is more similar to the population as a whole • Relatively high in: BG, RO, Baltic States • Relatively low in: FR, CY, FI, SE • Positive correlation between extent and severity, and also between extent and persistence At-risk-of-poverty rates: overall population and children, EU-27, 2007 Source: EUROSTAT High persistence: LT, PT, ES, PL, IT, but not in the UK

4. Almost 1 children in 10 in the EU lives in jobless households Share of children (0-17) and adults (18-59 – not students) living in jobless households, EU-27*, 2007 (%) • Reasons for joblessness can be found on both the supply and demand side • Lack of or inedaquate human capital of parents • Counter-incentives of income supports • Shortage of childcare • Regional and/or ethnic segregation • The risk of poverty among children is inevitably linked to the underlying structure of the households in which they live • Children in jobless households are likely to live in lone parent families: BE, EE, IE and the UK • Children in large families are affected in HU Source: EU LFS *No data avalaible for Sweden

5. Sensitivity of risk of poverty rate to alternative measures of low work intensity (based on EU-SILC) Source: own calculations based on EU-SILC 2007. Note. BG, MT and RO are not included.

6. Most of children live in households where at least one person is in full-time employment • Similar share of children in in-work (WI>=0.50) households across countries • Large variation in the risk of poverty • High in Southern countries, Baltic States, LU, PL • Reasons behind • Low wages • Insufficient labour supply of parents (shortage of childcare, social norms, etc.) • Only one parent in employment • Part-time work In-work poverty (WI>=0.50) in the European Union* Source: own calculations based on EU-SILC 2007 *No data available for analysis for BG, MT and RO

7. Children in one-earner households are at four times higher risk than those in two-earner households in the EU Children in one-earner households (WI=0.50) in the European Union* • High share, high risk: EL, ES, IT • Low share, high risk: LV, LT, PL, PT • In general, having both parents employed, is the best way of avoiding the risk of poverty • Two-earner model: Nordic countries, CY, SI • 1+1/2 earner model: NL and at some extent in DE (also SE, AT) • Where the incidence of part-time employment of mothers is high, their children face comparably low risk of poverty as their peers in two-earner households do Source: own calculations based on EU-SILC 2007 *No data available for analysis for BG, MT and RO

8. Social transfers reduce the proportion of children at risk of poverty by 42% in the EU as a whole Distribution towards children at-risk-of-poverty and the effectiveness of social transfers (excl. pensions), EU* • The effectiveness of transfers reflects both the scale of expenditure level and the extent of targeting • Highest impact in: DK, FI, SE, as well as in DE, FR, HU, AT, SI • Lowest: EL, ES, IT • Serious limitations of the EU-SILC • No behavioural responses are considered • No full account of taxes and social contributions • No account of transfers via the tax system • Hard to identify child-contingent payments • Effects are likely to be over-estimated Source: own calculations based on EU-SILC 2007 *No data available for analysis for BG, MT and RO

9. Relative outcomes of countries related to child poverty risk and main determinants Group A: good performers in all dimensions

10. Relative outcomes of countries related to child poverty risk and main determinants Group B: joblessness is key challenge

11. Relative outcomes of countries related to child poverty risk and main determinants Group C: relatively bad performance in all dimensions Group D: in-work poverty is key challenge

12. Thank you for your attention! www.tarki.hu

13. Sensitivity of risk of poverty rate to alternative measures of low work intensity (based on EU-SILC)

15. Probit estimates on marginal effects for child poverty

16. The risk of poverty living with a mother in part-time emplyoment relative to those with full-time employed mothers