CHILD POVERTY IN THE UK: SOCIO-DEMOGRAPHIC SCENARIOS TO 2020 FOR CHILDREN

1. CHILD POVERTY IN THE UK:SOCIO-DEMOGRAPHIC SCENARIOS TO 2020 FOR CHILDREN Phil Rees & John Parsons University of Leeds Paper presented at the Third International Population Geographies Conference University of Liverpool, Liverpool, UK 19-21 June 2006

2. Context (1): Questions asked • The work was part of a School of Geography, Leeds (SOG) project for the Joseph Rowntree Foundation (JRF) in collaboration with the Institute for Fiscal Studies, London (IFS) • JRF wished to know answers to these questions: • Will the government hit its child poverty reduction targets? • Are socio-demographic trends favourable for achieving these goals or not? • How will poverty alleviation strategies affect children in different parts of the United Kingdom?

3. Child poverty living on less than 60% of UK average (median) income (household income standardised for number of adults & children) AHC After Housing Costs Tony Blair (1999): “this government will eradicate child poverty by 2020” IFS interprets government statements to mean: 1998/9 to 2004/5: 25% reduction in numbers 1998/9 to 2010: 50% reduction in numbers 2010 to 2020: 50% reduction in numbers (not “official”) These are really ambitious targets Will socio-demographic trends help?

4. Context (2): What was needed? • IFS method is to run a micro-simulation model for households, families and children using inputs from the latest Family Resources Survey (DWP/ONS) • IFS needed to re-weight the micro-population using key population variables projected to 2010 and 2020 and SOG • IFS/SOG might have created a dynamic household microsimulation model but time and resource limits meant this was not possible (though two teams in SOG are doing this in current projects with EPSRC and ESRC support)

5. Our “pragmatic” approach • Use the Individual Sample of Anonymised Records from the 2001 Census of Population to create an 8-dimensional population array: P2001(x1, …, x8) • Develop 8 sub-array projections for 2010 and 2020: P2010(x1,x2), P2010(x3) etc = marginal distributions of the full array • Apply Iterative Proportional Fitting to adjust the 2001 population array to the 2010 and 2020 constraints • Because the data came from many different sources and despite adjusting each sub-array to the same grand UK population total, we were not satisfied with the robustness of the results (further work planned to resolve this by Parsons, Jin and Rees) • Nevertheless, the marginal distributions were considered reasonable projections of each dimension for IFS to use them to re-weight their microsimulation results • Full reports will be published by the Joseph Rowntree Foundation this summer

6. The seven population dimensions projected for each region • Age and sex, with child dependency • Ages 16-18 split between dependent and non-dependent children • Household size • Large households are at higher risk of poverty • Number of dependent children • Families with many children tend to be poor • Family type • Some types e.g. lone parent families are at high risk of poverty • Ethnic groups • Some groups face higher poverty risk than others • Number of earners in household • Non-earner households are poorer • Tenure • Households in some tenure types (e.g. social housing) tend to be poor

7. Methods • A mix of methods was used to project these marginal dimensions into the future • Mostly we used extrapolation based on trends 1981-2001 in census distributions • Sometimes we used trends in FRS distributions for 1998-2004 • For ethnic groups we built a cohort-component demographic projection model • The paper goes into the detail of data sources and methods • In the rest of the presentation, attention is focussed on our results and their implications for child poverty

8. The 2004-based UK projections (the latest) see population growth continuing until the 2070s, despite below replacement fertility, because of higher migration assumptions and improving longevity. But the population continues to age and the number of children fluctuate (echoes of echoes of the baby boom). The number of dependent children is falling in this decade but not in the next (in part because of a small shift from non-dependency to dependency among 16-18 year olds). The numbers help attainment of the 2010 target but not the 2020.

9. These figures combine GAD 2004 national projections with 2003 regional projections for England. Southern regions are projected, because of lower mortality, higher immigration and net internal migration gains in younger ages, to grow faster than Northern. Note that the populations of the North East and of Scotland grow hardly at all.

10. These projected population changes shift the distribution of children towards regions with higher incomes (after housing costs). This will be helpful for the achievement of the child poverty reduction goals.

11. Our projections of population by household size (based mainly on extrapolating 1981-2001 trends because the national projections fail to provide much information!) show a continuing fall in the numbers of larger households (with 4, 5 or 6+ persons). Again, this trend favours attainment of child poverty goals.

12. We use a set of cartograms to display the changes in the population variables. The cartogram assigns an area on the map in proportion to the regional population (developed by Durham, Dorling and Rees). The cartogram gives due population weight to the urban region of London.

13. These maps show a uniform and substantial fall (25%) in the percent of people living in larger households between 2001 and 2020.

14. The graph and maps confirm that the fall in household sizes is due to both fewer people living in households with dependent children and a fall in share of households with 3 or more dependent children

15. Lone parent families are the poorest and our projections show a reduction in the share of the population living in these households, except in London.

16. The White population grows a little during the 2001-2020 period (mainly because of new immigration). The Ethnic Minority population grows very substantially because of demographic momentum and high immigration. However, there are differences between the groups in terms of (child) dependents. Very little growth of dependent children in the Black group, high growth in Asian and Mixed dependent children.

17. This graph for the Asian population shows the growth in dependent children but note that there is higher relative growth in the labour force and older ages (as a result of the ageing of earlier cohorts). Fertility rates in the Asian groups are converging to lower national levels.

18. Our projections show what changes are likely in the ethnic composition of the regions of the country. There are profound contrasts in ethnic diversity between the South & East regions and the Celtic periphery. The changing population mix will tend to work against the attainment of child poverty reduction goals as the population shifts towards groups with larger and poorer populations on average.

19. What is interesting about this map is that the greatest relative change in regions that have lower concentrations. There is deconcentration of the ethnic minority population at regional scale (and also probably within regions and cities – see papers by Simpson). The implications for child poverty reduction are indirect. The ethnic minority populations growing fastest outside their areas of concentration are probably better off and suffer less from child poverty, so this is a favourable trend.

20. No great changes projected here, but this ignores other influences on the number of earners such as rising age at retirement, continuing rise in female labour force participation and measures to encourage lone parents and working age persons on disability benefit into work.

21. It is difficult to be confident about the flatness of the trends here. This is based on extrapolation of two decades of Conservative and Labour government. Imagine the contribution to national wealth and child poverty reduction if all regions could attain the labour force participation of the East of England (Cambridge, Peterborough, Norwich, Ipswich etc).

22. Our projections see continuing reduction in the social rent household category. This is helpful for reaching child poverty reduction targets. However, London appears to be an exception, with a rising proportion in social rented housing.

23. Conclusions • The government’s child poverty reduction target is tough and it has missed it 2004/5 target (though not by much). • The reductions will need to accelerate to achieve 2010 and 2020 targets • Socio-demographic trends are favourable in small ways (because the targets are defined in number rather than percent terms). • However, some trends move in the opposite directions so the net effect is unclear. We need to be confident about our SAR/IPF model or in future dynamic micro-simulation models to be certain what the overall outcome will be. • When the IFS work is published, we will be able to judge the effect of socio-demographic trends against anticipated or suggested policy changes.