One in four children in Scotland – around a quarter of a million – lives in poverty.
And if you’re born skint, the chances are you’ll live skint and die skint. Poor kids do worse at school, endure worse health, are more likely to end up homeless and die younger. It’s called the “poverty trap” for a reason.
I’m not best placed to argue about the extent to which social mobility has stalled, when that was, and who was at fault. But I do understand the world of work and can see that the business community has something to contribute to breaking the current cycle.
So, as we digest the Scottish Government’s latest Tackling Child Poverty Delivery Plan, published last week, what can and should we be doing?
Well, the first thing is to play to our strengths. We know that the biggest risk factor for child poverty is living in a workless household – and that’s exactly where around 80,000 children in Scotland find themselves today. We also know that businesses are good at creating jobs – and small businesses have a particularly strong track record of providing employment for those furthest from the labour market.
So, at a time when the jobs market has scarcely been tighter and hiring staff is difficult, we need to set about removing the barriers stopping those who are unemployed – and the far larger group who are economically inactive due to ill-health or caring responsibilities – taking up employment opportunities.
It’s hugely impressive to see the creative ways in which employers are tailoring their work patterns and wider offer to attract more candidates. But there are limits to what’s practical – certain roles will always need certain people in certain places at certain times.
So we also need to look at removing the obstacles daily life puts in a would-be employee’s way.
If, for example, you have school-age kids and your job is an hour away by public transport, how many hours can you realistically work between dropping them off in the morning and picking them up at 3 o’clock? How many more hours could you do if there was proper wraparound childcare that actually reflected what a busy working parent’s day was like?
And, while we’re at it, why do so many people need to travel distances to work? Why can’t we bring more jobs to where the people already are? Over the last decade or so, we have seen major public and private sector employers decamp from their town centre sites. If we are serious about local economic regeneration – and the idea of “20-minute neighbourhoods”, where everything you need for daily living is no more than a short walk from your front door – this is a trend we need to reverse.
At the same time, we can’t ignore the fact that, on top of the 80,000 children in workless households, there are more living in relative poverty in a household where someone works.
So, as well as removing practical barriers to help parents work more hours, what can be done about their hourly rate?
Now, before going any further, let’s be clear that this is by no means simply a private sector problem – and certainly not a small business one. There are just under 2,500 living wage accredited employers in Scotland, two-thirds of whom are in the private sector. And, of those two-thirds, more than 80 per cent are small businesses.
But there’s no getting away from the fact that spiralling overheads give smaller employers, especially in certain sectors, very little room for wage rises unless they can cut costs elsewhere or raise prices.
One bright spot on that front, however, is the increase in the Employment Allowance – essentially a tax threshold on employers’ national insurance contributions – from £4,000 to £5,000, unveiled by the Chancellor in his Spring Statement last week. This is something for which the FSB has been campaigning for months and will help small employers find some breathing space.
Tackling child poverty looks like a huge ask because that’s exactly what it is. But that doesn’t make the task insurmountable. We can all help break down the practical barriers keeping people from work and families from the life they deserve.
Colin Borland is director of devolved nations for the Federation of Small Businesses
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