Human Resources Committee on March 12th, 2009

[The Chair, Conservative, Dean Allison]

Pursuant to Standing Order 108(2), we're going to continue with our study on the federal contribution to reducing poverty in Canada. I'd like to welcome today the Right Hon. Iain Duncan Smith, an MP and the founder and chairman for the Centre for Social Justice.

Because I know that Iain probably won't do this, I just want to give you a bit of a quick background on him, as I was able to Google him. That's the problem with politicians, we've all got a history in terms of the Internet.

I know that he first ran in 1987 and was unsuccessful. He was finally elected in 1992 and represents the riding of Chingford and Woodford Green. I understand that used to be Winston Churchill's riding. Is that correct? Yes.

He was elected as the leader of the Conservative Party and was then obviously the leader of the opposition in 2001. I believe your leadership race was September 12, 2001, right after 9/11.

[Iain Duncan Smith, Founder and Chairman, Centre for Social Justice, As an Individual]

It was literally on 9/11. I pushed it back a day because I didn't think anyone wanted to hear from us on that day.

[The Chair, Conservative, Dean Allison]

I was going to say, talk about unfortunate timing as far as that goes.

As I read in your bio, I understand you are a distant relative of George Bernard Shaw. Of course, in my area we have the Shaw Festival, so this is something that we appreciate greatly.

You established the Centre for Social Justice in 2005. One of the things that I find interesting about your perspective as a member of Parliament...and if I could just read the mission for the Centre for Social Justice:

...develops and promotes effective new approaches to tackle Britain’s poverty and most acute social problems. We are not a conventional Westminster think-tank. Rather we exist to champion and learn from the work of effective grassroots poverty-fighting groups throughout Britain.

That's one of the things we're hoping to do in this committee, to look at what the grassroots are doing and find effective in order to make recommendations. It goes on to say:

Policy development work is rooted in the experience and wisdom of the hundreds of small charities, social entrepreneurs...that are having great success in tackling Britain’s deepest problems where the best efforts of the state may have failed. Our job is to learn from these groups, enabling them to share their hard won expertise with senior politicians in Westminster and local government. We are constantly driven by the need to bring politicians face-to-face with the realities of breakdown in Britain.

If my colleague Tony Martin was here, he would agree with what you guys are doing.

The other thing that I also wanted to point out, and you may in your opening remarks, is that it's not a question of left or right, north or south; you work with all groups. One of the groups you've worked with is the Smith Institute. John Smith was the leader of the Labour Party from 1992 to 1994. I just wanted to point that out to my colleagues.

I'm going to turn it over to you now, Mr. Smith. We look forward to hearing your opening remarks. Then we're going to take time for maybe one or two rounds of questioning. We have from 10 until 11 o'clock, when I know you have to leave and we have other witnesses coming in.

Welcome, Mr. Smith. The floor is now yours.

[Iain Duncan Smith]

You had me slightly worried there, because I thought I was at the wrong committee meeting.

Thank you very much indeed for that kind remark. Thank you again for the invitation. It's not usual that I'm at the other end of one of these committee hearings, but I'm always happy to do it. In fact, I was due to be at one this week at our end, on education, to do with what we've written, a committee chaired by a Labour MP in the House of Commons, and I had to decline because I said this committee was more important.

I'll say anything to please this committee.

Can I just say first of all that it is a great pleasure to be here. I thought I'd say a couple of words about what we do. I want to stress at the beginning that the Centre for Social Justice, as you said, Chairman, is not parti pris in the sense that I'm a Conservative, but I've no idea what pretty much everybody who works for me votes for. We are funded separately from the Conservative Party. I have to raise that money, and I raise it from people who are interested in what we do and are committed to the concept of social justice.

As you see, we've worked with the Smith Institute. We're in the process of discussing further work with some other think tanks that you would classically describe as on the left--IPPR, which is quite big. We've had plenty of invitations to work with others. And I've done a personal piece of work, a pamphlet on early years intervention, which I recommend. I'm happy to send the committee all of this stuff. I did that with a Labour MP named Graham Allen, who used to be a government minister. He's a very good friend of mine, but we also happen to fundamentally agree about development in children in the period of nought to three years--and I'll say something about that later, how that intervention should work.

By the way, you have a fantastic program here in Canada, which I've yet to see. The Roots of Empathy program, I think, is in that area, and whatever you are doing, I hope you do get to see that particular program because it is one that I would like to see us take to the U.K.

The Centre for Social Justice was set up by me because I was rather tired of the stilted debate that goes on between--I'll be honest with you--the so-called social liberals and the so-called social conservatives, into which you can bat around the faith issues as well while you're at it. It struck me that this hasn't done anything for the debate about what's happening to our society in the U.K. in the last 25 to 30 years and almost under the noses of what has become a pretty high-level and rather pointless political debate.

What we're actually seeing in the U.K. is the growth of residual unemployment, social breakdown, and--I can argue--deep-rooted poverty lifestyles. It's ironic because the U.K. would pride itself on being, arguably, the fourth-largest economy in the world. It did seem peculiar that when I went round and visited a lot of what I would describe as inner-city communities, as I have done over a number of years now, what struck me was that you can move a short distance and find yourself in an area--for example, in parts of Glasgow like Carlton Place or Easterhouse, Gallowgate, places in the east side of Glasgow--where the life expectancy is around 50 to 55 years. Yet if you walk seven miles up the road to another part of Glasgow, the life expectancy is 82. It seems to me quite peculiar that you should have this incredible disparity in life expectancy within a metaphorical stone's throw within the same precincts of the city.

I would assume that there will be problems similar to that in Canada, but I make no major assumptions and I'm very happy to be led by you on this. But the thing that bothered me about that was that it seemed that we had reached a point where there was a growing disparity between people at the bottom of the socio-economic group and people in the rest of society, and that it was gathering in distance. And the more dysfunctional group, the group with the greatest problems, was actually growing in number.

One of the key issues that I've often been attacked on by people on my side of the political divide is that this is all very nice, but it's all about costs and spending money. My answer to everybody about that is that actually we're already involved in spending vast sums of money because we are driven constantly by the nature of growing demand, so to pretend that somehow this is about getting involved where we shouldn't be.... We're already involved in that. Let me give you some figures for that.

The cost to the state in the U.K. of family breakdown is now well over £20 billion a year, that is to say the cost of picking up the pieces. The reason for that is that we know that the income of a lone parent, once that family splits, falls dramatically. It can be anything up to a third in total, so the state invariably, if that family is not reasonably wealthy, is going to probably end up stepping in to uplift the income in some particular form. It could be through income support or some form of incapacity benefit, or one of the myriad benefits--housing benefit, for example, to sustain them in some form of housing.

So the state is already involved in the process of breakdown. The question is really, is it so reactive that it has no influence, or does it have any negative influences?

So the Centre for Social Justice was set up to look across the piece at what drove social breakdown.

Again, the other part of the argument I was rather tired of and that we tried to knock on the head was that poverty is solely an issue of money. That has often been the debate. So we ask if we can spend more money, if we should spend more money on this, and where it should be focused, rather than asking in a fully grown economy like the U.K., where there is arguably no shortage of employment or has been no shortage in normal times, why some people are trapped in unemployment and poverty.

It's different if you are looking at a country like Haiti or some place where you may have absolutely no employment, so you can understand that there are issues, but not in countries like Canada or the U.K., where these economies are well developed, diverse, and for the most part spread across most of the country.

So we're dealing with a slightly different issue. We looked at this and said, yes, of course, money is an issue. The definition of being in poverty still remains the fact that you don't have enough money to be able to make the necessary choices for you or your family. However, I felt it's more important to look at what drives people toward that situation. We felt that the lifestyles of people are part of that equation.

We wanted to look at what the key drivers were. We talked hugely to the voluntary sector who work in these communities. What were the main things they found in trying to deal with social breakdown? We boiled it down to five pathways that invariably lead people into that process of being too poor to be able to maintain their own lives without assistance.

The first we found was family breakdown; the second--these are not in order, by the way--was debt; the third was failed education; the fourth was worklessness and dependency; and the fifth pathway was damaging addictions to drugs and alcohol, although we did add gambling addiction to the studies later on, because we came under a lot of pressure from people in various towns where there has been an intensive process of casino building, etc., where they found there are some connections with failed communities as well. So later on we put in a section about gambling, but that was not one of our main areas.

The point we discovered about this was that so often the argument has been stilted. It's all about family breakdown or it's all about something to do with drugs or alcohol. We found each one of those five pathways played onto the other, so they're really a cycle, a circle of deprivation that leads one to the other.

Just to touch on it, one of the areas we found, for example, was that family breakdown leads to very poor outcomes. Up to 75% are more likely to fail at school, and a whole series of poor outcomes are increased by family breakdown--drug and alcohol abuse, debt, criminality. It doesn't exist in isolation.

One of the studies thrown up to me, which was fascinating, was that debt was probably one of the biggest causes of family breakdown. So you need to understand what is happening with debt. In the U.K. we had the highest level of personal debt. Over £1.3 trillion was owed in personal debt within the U.K. before the recession began.

We know the people who suffer most when it comes to debt are people in the poorer communities. They have very little access to competitive debt. They have therefore to pay inordinately high levels of interest. Now here in Canada perhaps that's not quite so bad because you have a slightly better position for poorer people. But in the U.K. we have doorstep lenders who charge very high levels of interest, up to 100% to 180% on bona fide loans, short-term payments, encouraging them to borrow for things that perhaps they don't need to borrow for. Then if they can't pay those off, they normally fall into the hands of the unofficial lenders who charge--it's very difficult to calculate--500% to 1,000% for loans, and failure to pay leads to physical abuse, etc. So we found that debt was one of the most classic examples of putting the pressure on families.

We also found, interestingly enough, that debt is one of the areas families cannot talk about. There is another area they don't talk about so much, but I don't think I want to place that in front of the committee. But the debt area was one that we found families, the two adults, will not talk about to each other, and therefore much of the family breakup takes place on other issues. But when you track it back, it comes back to debt.

This is the point we made about family breakdown costing about £20 billion-plus a year to the U.K. economy. We found that we spend between £500 and £800 per taxpayer on picking up the pieces, but we spend about 40p to 50p per taxpayer on assistance and support for families who are in difficulty; in other words, for counselling and help and support. From most of the evidence we took, you can end up with a 40% or 50% improvement in stabilizing families, yet we spend next to nothing on it, but we spend all this money on picking up the pieces afterwards. So we were asking questions about how we got ourselves into this position.

I'll work very quickly around the other areas.

It becomes self-evident that if you're in the position of a broken home, you're more likely to fail at school. That failure at school, clearly, leads you to being less likely to have any skills that are tradeable in the economy, less likely to be able to lead you to any form of sustainable employment.

We know that unemployment is, again, one of the big drivers to family breakdown. We also know that it leads, clearly, obviously, to debt. We know that debt leads to family breakdown. We also know that therefore people in these sorts of communities are more likely to find themselves falling foul, with drug and alcohol abuse. And drug and alcohol abuse, again, will lead to family breakdown. It's very difficult to sustain a family system if one of you is completely addicted to a form of alcohol or drugs.

It's also necessary, when we talk about money, to remind ourselves that these lifestyles make a huge impact. For example, it is quite feasible to take somebody and give them enough benefit to get them above the poverty line--60%, in the U.K., of median income. But their lifestyle will dictate how they use that money.

For example, if you were to simply give an unemployed individual who had a serious drug abuse problem enough money to get him above...which is quite feasible--governments can do that--I would guarantee you that if he had a family, his family would remain in poverty. The reason is because the drug addict, the drug abuser, is most likely to spend the majority of the money on his drug habits, thus leaving his family without enough money to survive properly. As far as the state would be concerned, that family would be out of poverty, but in reality they would not be, and therefore that lifestyle plays enormously on the way in which the money is used.

So the amount of money isn't always critical; it's how that money is ultimately used.

I have a very good example. The state very rarely asks, in the U.K., if you have a family. They doesn't ask drug addicts who are in treatment if they have children. The result of all of that is that the figures for children get lost. We know that there are more than a million kids who find themselves with parents who are seriously addicted.

I go to communities in Glasgow, where you will find that the drug addiction is enormous. It's not just there, by the way, it's in all the cities. Heroin abuse can be fantastic. In a place like Easterhouse, you'll come across whole households where, if they're lucky to have two parents, they'll both be addicted to drugs. And that makes it impossible for them to see their lives through.

I want to finish up on this point. I've done some work, with Graham Allen and others, on early years intervention. The thing that really does make this all come together is the fact that we now know--most of the neuroscientists tell us this, it's a physical fact--that the first three years of a child's life are arguably the most important years in their lives. The reason for that is because your brain develops at a faster rate in those three years, physically, than at any other time in your life. We all know that your brain develops only until you become an adult. It stops developing, and thereafter it simply atrophies and atrophies at whatever rate. Some of us are responsible for higher levels of atrophy than might otherwise be the case. Personally, I make no claim for myself. But the reality is that the first three years will set the tone for how your brain develops.

There are three critical factors. One factor is empathetic nurturing and care from an adult, in this particular case a member of your family, a mother or a father--more often the mother--with the ability to be able to work through play and interaction with that child to stimulate and develop that brain. The second factor is conversation, a child understanding that words become tools of communication. And third, reading, even to a child who doesn't understand words is absolutely vital. These three things, believe it or not, may strike you as fairly sensible. Probably everybody around this table had it happen to them. I don't know, but I would assume that was the case, which is why you may well be here. The reality with a lot of the families that I see is that this is a total mystery to many of them. Many of them will be from second- and third-generation dysfunctional homes.

I visit families where you will see the daughter having a child, with the mother who already has a number of children and another on the way, with the grandmother, who may only be 40 years old or in her late thirties, who is already in a relationship with other people and who is pregnant again and will have a child who will be as old as the granddaughter. In other words, the nature of the communities is becoming quite peculiar in some of these areas. You'll see young women with multiple fathers to multiple children. There was a case the other day in which she couldn't remember who the fathers were to most of the children.

In this whole process of dysfunctionality and breakdown, it's not that they don't love their children--I'm certain they do--but it's just that no parenting skills are passed down by the second and third generation. In fact, what happens is they're left to shift for themselves to understand what those may be.

The result of all of that is you'll visit these homes and there will not be a book on the shelves, which is not surprising because the mom never reached the reading age of 10. She herself doesn't read. Videos are in the room most of the time, and the children grow up in an environment where they witness quite a lot of violence and abuse--certainly a lot of anger. They go to nurseries at the age of three not school ready. Their brains are physically smaller than those of functional children and the neural pathways are all broken and certainly not developed.

These are the communities that I talk about when I talk about social justice. They're growing in number, and I think it's no longer possible for a modern society to ignore what is happening beneath them, which is this collapse of natural structure that is leading hugely to children growing into adults incapable of providing for themselves in the way that you would hope for.

That is what we did. We carried out a series of studies. This was the second of two studies on these five pathways. The other one is just as big--sorry about that--and the others have gone on to look at things like children in care, as I said, early years intervention and street gangs, which we've just completed. All of that is trying to paint a picture and show policy alternatives to that social breakdown.

[The Chair, Conservative, Dean Allison]

Thank you very much.

We'll now start with a first round.

I don't know if you speak French.

[Iain Duncan Smith]

I do, but not very well, sir.

[The Chair, Conservative, Dean Allison]

Some of the questions will be in French and you can adjust the channel to one, two or three.

We're going to start with the opposition, the Liberals.

Madame Folco, you have seven minutes.

[Raymonde Folco, Liberal, Laval—Les Îles, QC]

Thank you, Chair.

Welcome to our country, Mr. Smith.

I don't want to avoid discussing the early childhood education, which is so vital, important, and fundamental, but my question goes to another place. It goes to the place of the relationship of work to poverty.

We've always believed throughout history that people who worked were people who were not poor. If you worked, then you obviously made a little profit at the end of the year and you were not fundamentally poor. But what we've seen in the last few years, and from our standpoint we saw it in the United States first on a larger scale, is what we call the “working poor”. That is, people who have a decent job, who work, have a five-day-week employment, but who cannot afford to pay the rent, or cannot afford to buy a house, and live under bridges. So they are poor even though they are earning a decent salary.

My question addresses the phenomenon of the working poor. I'd like to hear from you on the experiences that you know of in the U.K. where you've actually tried to do something across the country to get people to continue to work at their own job, or at another job, but get them into a higher bracket of salary, which would then allow them to then pay their rent, or buy a house, or whatever. What initiatives have been presented in the U.K to make sure that people work full time, work the whole year, and as a result of that therefore have a decent living standard?

Particularly concerning women who raise children by themselves, lone parents, what sorts of initiatives are there that have worked that you know of? Could you tell us about not just these women, but the larger clientele, and more specifically the women who have children who live on their own?

[Iain Duncan Smith]

Right. I can't give you an absolutely comprehensive list, so I think I'll just dip into a few things the government has embarked on over the last 10 years and whether they've been successful.

The first is that, interestingly, there's been a shift in the poverty figures around children in the last 10 years. The government came in and decided they were going to target—I felt rather narrowly, with this expression that they wanted to eradicate child poverty by 2020—a group of children; they followed the child. Of course, the group that was more likely to be in poverty at that stage were the children in lone-parent relationships. So they targeted them with what I think became today quite a confusing number of different particular benefits. You know, there are tax credits for people trying to get into work. There are child tax credits, which are aimed hugely at those lone parents at the end of the day.

Now what actually happened is that to some degree they have been successful in lifting the children of lone parents up in terms of income. What has actually happened, though, is two things. The first is that I think there are now a growing number of children of couple families who are now falling back into quite deep poverty.

Second—I'm just looking because I've got a figure here somewhere that shows that, and I think these are the figures here now—the proportion of working-age adults in poverty overall hasn't actually fallen, though the level of worklessness in general in the economy has. So you can see this group has absolutely stood still while everybody else has moved forward. This means the poverty rate among working households has actually increased in the U.K. now. Now more than one in seven working households in the U.K. are what you'd describe as in poverty, below 60% of the median income.

Next, the number of households with children in poverty, whose head is workless, actually declined by some 300,000, although that's now static and it's beginning to slide in the other direction. While that is the case, the number of households with children in poverty whose head is working has actually risen by 200,000. So you can see there's been a swing-around. If the family isn't working, the likelihood is that their children are less likely to be in poverty. If the family is now working on these areas, it's likely to be in poverty.

Half of all children in poverty now live in a household in which someone is working. What's happened is that they've succeeded in shifting these figures around. There's been some improvement, but that I think has reached a pretty static position and it's beginning to decline. What they have done is wheeled the whole thing around.

Part of the reason is that the households we're referring to, an awful lot of them are in part-time work. Now, the trouble with part-time work...there's nothing wrong with part-time work in the sense that part-time work for a couple in a household can often be used to supplement income for that household. It may work for the person who is doing it because it's flexible and they can look after their children, but the main income may be earned by somebody else, and that therefore becomes sustainable. The problem in a household where the only income is part-time income is that it's simply not sustainable. You can't live on that particular income, so the government does provide supplementary benefits, as it were, to try to lift that up. The problem for a couple household is that those are nothing like as extensive as they are for a lone-parent family. That's why you see more couples who have work falling back into poverty, because there's a gap now. We call it the “couple penalty”. If you're a lone parent, you get a lot of support. If you're a couple, you don't get as much.

We've also made the point in our work that, in truth, everything should be set to move people from part-time work in due course to full-time work, over 32 hours a week, and the problem there is this. The government, because they have supported people into part-time work, as people want to move from, say, 16 hours a week, which you might describe as part-time work, to 32 hours a week...what happens is the withdrawal rates as a result of their fall-off in their benefit support are so dramatic that in the case of a lone parent, for example, moving from 16 to 32, she can lose up to 90% of the income earned between 16 and 32 hours a week. So for every pound earned, she may take home only 10p. That's a higher tax rate than for the wealthiest people in the country. In fact, I don't know of anybody in the country who would put up with paying a tax rate of 90%. But they do.

So you find for those in that group they have a problem. There is no incentive for them to move beyond 16 hours because that period between 16 and 32 hours is very painful for them. They work long hours in that sense, but they don't get any great reward for it. It's only when they break through, at 32 hours roughly, that their tax rate then collapses back to the bottom end of it and they start to earn reasonable money. But it's very difficult to get them through that.

What's happened, again in part-time work, interestingly, is that there's a disparity now between people on supported benefits, even if in part-time work, and those who are out working where their job is their sole income. I can give you an example here.

A single mother with two children now receives more than a whole series of people. She'll get roughly £262 a week. That's more than the average waiter, who might earn about £113 a week; a cashier, at roughly £128; someone who's stacking shelves in a supermarket, at about £155; a library assistant, at the low grade, at £170; a hairdresser, at about £188; a child minder, at £240; and a street trader, at about £240 to £250, though the last figures are difficult to estimate.

So there's another element to this, and we took evidence from a number of people who said there's not much point in my really trying to get onto the bottom rung because, frankly, I'm going to find that my income will fall off. The reasons for that, obviously, have to do with the housing benefit, and the fact that their support in other areas will fall away and they'll lose it, so they're left wholly having to survive on what they earn.

So all the recommendations we've brought forward on this are to try to smooth that transition period out. What's critical is that work should be seen to pay. If work doesn't appear to pay for people on benefits, they simply will not take it.

Now, all of us around this table, I would hope, understand that work ultimately pays, in the sense that it develops—even if the disparity at the beginning were less—and benefits don't. So these people will in due course go on to earn more than their benefits are worth. But it is very difficult to persuade people who need to take a cut in their income that it's worth doing.

Another area that we found is very difficult for people who are working part time and therefore are still in poverty is that they face another problem. Some of those who have begun part-time work, with a view to developing it, have had a very high churning rate, particularly lone parents, who go in and crash out in a matter of weeks again. Then what happens is that the old “jungle telegraph” beats, as I call it. In other words, information is passed around from people by word of mouth in these areas; most people aren't reading newspapers or documents, but are just talking. So the news goes around by word of mouth that if you take a job, it's more than likely you'll be out of it; that they'll push you towards a job, you'll go into work, and you'll be out of it. It's the worst thing you can do, because it can take up to a month to receive the housing benefit again. What happens is you're now materially worse off for having gone into work for a month, or maybe a month and a half, or two months, as you rush around trying to re-engage your benefits, because the state is very slow to put those together. So the advice that goes around is, don't do it. What happens is that a lot of people then become quite work-shy, because they're scared they're going to be in the same position, the word of mouth being that you're not going to be in a sustainable job.

This is the other point we make, which is one of the biggest problems that goes on in the system. As a country we're very keen on pushing people into work, but in actual fact we do very little to sustain them in work. There's a very good organization in the U.K. called Tomorrow's People. It's a voluntary organization. It prides itself on getting people into work from the most difficult circumstances, and then maintaining them at work for a long time; 75% of those they get into work are in work a year later. The best you can say for government programs, I think, is that 13% are in work something like 20 weeks later.

[The Chair, Conservative, Dean Allison]

Thank you. We're going to move to our next round. We have about seven minutes for questions and answers.

Mr. Lessard, thank you very much, the floor is yours.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Thank you, Mr. Chairman.

I want to thank our guest for being here to give us the benefit of his experience.

First of all, through you, Mr. Chairman, may I ask our guest not to speak so fast, for the benefit of interpreters?

[Iain Duncan Smith]

I'm sorry.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

I am fascinated by your approach, Mr. Smith. As a parliamentarian, you have found it necessary to create this new Center for Social Justice and I understand that the role of this think-tank is to provide the government with the benefit of its thinking.

I may be mistaken but is that not a de facto recognition that the power of legislators to do anything to reduce poverty really is limited?

[Iain Duncan Smith]

Yes, that's true. You'll forgive me if I'm a bit brutal with you, but I don't think this sort of format is capable of doing the work we've done, and there's a very particular reason for that. When groups of MPs gather to do studies of this nature, all of us bring our own preconceived ideas to the table. That's the nature of who we are. We are members of Parliament. We are tribal. By and large, we arrive here believing in certain things, and it's very difficult, within the format of Parliament, to simply break that down.

The reason I took this outside of Parliament was because I felt I needed to take a pace back and let others, who are not driven by political imperatives, follow the facts. Everything we produced has not been written by me but by people who have some experience in this. I have simply followed the facts. I hope those facts, and ultimately the solutions, are available to the government on the basis that they don't have any political side, that they are simply what we found and the best ways to resolve them. They have looked at international comparisons as well.

Certainly there is a weakness within a parliamentary system in delving too deeply into things. Where committees like this work really well is in interrogating government and asking why they failed or why they haven't done stuff or why they should do things. Once you get past that, the problem is in this nature of looking too deeply. The distractions and the tribalism make it quite difficult to do that, I think.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Whatever the role of this think-tank, one has to recognize that only legislators would have the power to implement any policies to reduce poverty.

Has the United Kingdom taken any new and original initiative that had a significant impact on poverty?

[Iain Duncan Smith]

Obviously the most important thing about resolving poverty is access to work. There is no question about this. If ultimately the family is to be free of the state of poverty, work is critical. There must be work.

One of the points I make throughout is that we should stop talking about lone parents or couple families and we should talk about families. For a family to be free of poverty, the fact is that family needs to have access to full-time work. Somebody in that family needs to be able to work. Whether they are lone parents or couples, that equation still stands. Therefore, it is resolving how a lone-parent family is able to do that with all the responsibilities that go with it.

Clearly one of the main things government can help with is trying to encourage people into work. That would arguably be the best thing that can happen. The trouble is that governments have created a complex benefit system, which acts as a block against people going to work.

I gave an example earlier of the withdrawal rates. That acts as a major disincentive. On the one hand, you have the government saying it is going to encourage everyone into work; on the other hand, when they get to a certain point, the treasury says--which the treasury always does--it wants its money back: “We're damned if we're going to let these people hang onto any money any further than they should because we have a responsibility to the taxpayer.” You have these two ends working against each other.

This has not been resolved, frankly. We talk about that in our report. After a huge amount of study, we're about to publish a system of benefits that we think will change all that--essentially everything that leads to stabilizing families so they can get into work.

But critically, we think the government needs to stop chasing children and start looking at the family structure--in other words, supporting family structures, encouraging people to be in stable family structures that help them provide for their children. That process is almost non-existent in the U.K.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Let us look at the issue you have raised. Having a job is still a requirement. In the working world, there seems to be some kind of inequality between men and women as far as working conditions are concerned.

Is there in your country any legislation to prevent this inequality in the working conditions of men and women, especially at the salary level?

[Iain Duncan Smith]

Yes, there has been a lot of work going on in Parliament about getting rid of the discrimination against women in the workplace. I suspect that's what you're referring to. Quite a lot has taken place in regard to that, but still there's a debate going on about the disparity in income between men and women in the U.K.

Some of that is met by the fact that women are more likely, proportionately, to be in part-time work. So when you look at the figures across the piece, they don't always tell you the full story. But there still is, in some cases, a glass ceiling. There are still problems for women both accessing certain areas of work and sometimes moving on through them. I would be the first to accept that was the case. I think it has improved a lot over the last 15 to 20 years in the U.K., but there's always room for further improvement.

But the real point I have a problem with is that actually when you talk about poverty and the groups that are in poverty, we don't even get to the point about issues over women, because there is an absolute absence of skills and capacity even to get to the point of debating whether women are able to be in the workplace. The fact is many of the women that I see in these conditions have no reading age worth talking about, they have little or no skills, they left school early, and they're in very destructive relationships. And that applies to their children, who then go on to repeat much of that themselves.

The problem here is that many of them are not ready for work at all. The idea that you can cram somebody into work simply because you have a target is an absurdity. What you have to do is work with the person to make them work-ready. That's not to say you put them on courses to make them carpenters or steel welders, or whatever it happens to be, but you do need to get rid of some of their problem, maybe drug or alcohol abuse, maybe issues concerning mental health problems, or poor reading capacity. Sometimes you need to work with them first to get them ready for work, so that when they get to work, they're more likely to stay in work.

Then you need to mentor them. There's no question in my mind that if you do not follow through with someone who has never held a job before and comes from a family where there has been no work, they are almost certain to crash out of work unless you support them for the next nine months or a year in their work so they get the work habit that is a fact for most people around this table.

That's not understood by a lot of people. They often say, “When they get a job, why don't they stay in work?” The answer is because if you go home to a family in the evening that has never had a job for three generations, where nobody understands what the hell you're doing going to work in the first place, the moment you hit a problem with your boss, what are they going to say to you? They'll say, “I don't know why you bothered. Why did you bother to take a job in the first place? I wouldn't bother. It's a waste of time. Stick at home. Don't do it.”

They have no support with a view to going out, and they see nobody in their community who is doing so. We have social housing estates where, literally, people will grow up not seeing a single person go out to regular work. They'll see no fathers. Fathers have disappeared from these estates, in a structural sense. Often they're only destructive forces and they will be seen only in street gangs or as drug dealers. They will not be seen as a member of a household contributing to that household. Very little of that goes on.

If I lived in a community like that, the chances of me sitting here today would be almost nil.

[The Chair, Conservative, Dean Allison]

Thank you very much.

We're going to move to Mr. Martin for seven minutes.

[Tony Martin, NDP, Sault Ste. Marie, ON]

Thank you very much.

Thanks for coming and being here this morning. I'm sorry I wasn't here earlier to hear your initial presentation, but I have read over your material for today—

[Iain Duncan Smith]

That's very brave of you.

[Tony Martin, NDP, Sault Ste. Marie, ON]

—and found it rather interesting.

You speak as somebody who is no longer in government, as being keenly interested less in the surface and the way that government often responds to the surface of this problem and more concerned about the underlying reasons for poverty. You've mentioned one, which is the breakdown of family and its poor structure. Are there other reasons you would speak to here? I don't know, maybe you made this case.

[Iain Duncan Smith]

I would first of all say that the problem we have as elected individuals in government—I don't know, and I assume it must be the same over here—is that we have very short time scales. The fact is that in the U.K. a government is elected for up to five years, but every year we have a budget and every year we have to look at making that budget work. That is 12 months, so basically government works on a 12-month cycle.

I don't know of anybody out there who works on a 12-month cycle, in the sense that lives are not lived for 12-month stretches; they're lived for longer. Let me give you an example of how that affects things.

I've just done this work with Graham Allen on early intervention for children, nought to three, which I think, by the way, is the single most important thing about family structure--getting kids balanced and right from day one, and trying to stop young girls having children early and blighting their lives. All of this is part of it. But I know that this program to put those broken families right is going to take a minimum of 15 years. I know of no government that has ever thought 15 years ahead. Most governments I know find it difficult to look at five years ahead, even three years ahead, and in some cases, when they get into difficulty, three weeks ahead. So that's what makes this a big problem for us as politicians.

I'm trying to take an area like this and persuade government and my own side and the others who are in politics to try to put this on one side of party politics and somehow accept that for the next 15 years, if we can agree that early intervention is a critical area, then these programs--we agree we can differ perhaps about some of the programs and we can set the values right. Somewhere along the line, we need to commit to a process of work that actually takes us through, regardless of who's in power, for maybe the next three or four elections.

You will see returns in two to three years and five years and eight years, but in truth, to take a child from nowhere to 15, 16, and 17--that's when you will see what happens to them as they form the next generation. First of all, there will be fewer lone parents in terms of teenage pregnancy. Then they will be more likely to form relationships, which is what happens after the early intervention program is successful. They will be less likely to be in crime, less likely to be unemployed, and more likely to stay at school. All of those things you will see gather through as they go. I know this because I've seen these programs at work elsewhere.

If you go to Colorado and have a look at what's going on there, they've been doing this for 20 or 25 years. It's quite breathtaking what Nurse-Family Partnership can show on their test groups, but it's taken them a long time to do it. It's done hugely through the voluntary sector, but with state government support and help. It takes some brave politicians to make those decisions.

My focus is that if there's anything to be done, it's the long-term stuff on early years. All the rest of the work we talk about here could be done now, but this is stuff that will take a period of time.

[Tony Martin, NDP, Sault Ste. Marie, ON]

Okay.

I read in your material that you certainly support the notion of community and community effort.

[Iain Duncan Smith]

Yes.