Labour’s record on poverty and inequality

The last Labour government made 'considerable' progress on its chosen objectives of reducing child and pensioner poverty, but had little impact on overall inequality, according to a major study of its time in office (1997–2010).

The 'Social Policy in a Cold Climate' project, being carried out at the London School of Economics, aims to chart developments on a wide range of social issues since 2007 – eventually allowing a detailed comparison between the Labour and coalition governments. A new report from the project summarises five separate studies of the Labour period, including one focusing on poverty and inequality.

Key findings

• Labour's aims for poverty and inequality were selective. 'Equality of opportunity' was the stated aim, rather than equality of outcome – with a focus on lifting the lowest incomes, not reducing the highest ones.
• Labour gave priority to reducing child and pensioner poverty, addressing them through a series of reforms. It increased the share of national income provided through cash transfers to children and pensioners, and increased the value of their cash transfers relative to the poverty line.
• By contrast, spending on other transfers (to working-age adults) fell as a share of national income from the level Labour inherited, and benefit levels for those without children fell further below the poverty line.
• By the end of Labour's period in office, both child poverty and pensioner poverty had fallen considerably, in circumstances where child poverty would have risen without the reforms (and pensioner poverty would have fallen less far). However, poverty for working-age adults without children increased.
• The risks of poverty converged between children, their parents, pensioners and other working-age adults. Being a child or a pensioner no longer carried a much greater risk of living in poverty than for other age groups.
• Overall income inequality was broadly flat, comparing the start and end of Labour's term in office. But differences in net incomes between age groups were much lower. The smoothing of incomes that occurred across the life cycle could be seen as a 'striking, if unremarked, achievement'.

Source: Ruth Lupton (with John Hills, Kitty Stewart and Polly Vizard), Labour's Social Policy Record: Policy, Spending and Outcomes 1997–2010, Social Policy in Cold Climate Research Report 1, Centre for Analysis of Social Exclusion (London School of Economics)
Links: Report | Supplementary paper | Nuffield Foundation press release | Guardian report
Note: Details of individual papers:
Polly Vizard and Polina Obolenskaya, Labour's Record on Health (1997–2010), Working Paper 2
Ruth Lupton and Polina Obolenskaya, Labour's Record on Education: Policy, Spending and Outcomes 1997–2010, Working Paper 3
Kitty Stewart, Labour's Record on the Under Fives: Policy, Spending and Outcomes 1997–2010, Working Paper 4
John Hills, Labour's Record on Cash Transfers, Poverty, Inequality and the Lifecycle 1997–2010, Working Paper 5
Ruth Lupton, Alex Fenton and Amanda Fitzgerald, Labour's Record on Neighbourhood Renewal in England: Policy, Spending and Outcomes 1997–2010, Working Paper 6