Assessing the tackling child poverty agenda: the role of prevention

An agenda in limbo

March was a busy month for the tackling child poverty agenda in Scotland. First, we saw the publication of Bringing Hope, Building Futures, the Scottish Government’s third and final delivery plan before the statutory child poverty reduction targets come due in 2030. That was followed by the annual release of poverty statistics, covering the period up to 2024-25.

Yet for all the busyness, there was a distinct sense of anticlimax. With an election around the corner, the Scottish Government took a relatively cautious approach to the delivery plan, with decisions beyond 2026-27 left for future administrations. Meanwhile, the statistics were affected by the first in a series of backward revisions that will confound our ability to monitor progress against the targets for at least a few years.

There will no doubt be frustration that these hold-ups have come right as we enter the final stretch before the 2030 targets. But this hiatus also presents an opportunity to take a step back and reflect on the tackling child poverty agenda as a whole, before the new administration considers the way forward.

At SHERU, we have a keen interest in understanding how national strategies are impacting the socio-economic determinants of health inequalities in Scotland. The growing momentum around preventative approaches to policymaking – which aim to address the drivers of adverse outcomes, including poor health, rather than only mitigating their consequences – is therefore welcome. Furthermore, families with children in poverty are one of our key groups of interest – not least since child poverty is a major driver.

The question thus arises: how does the tackling child poverty agenda position itself in relation to prevention? And is there scope for the potential of prevention to be more fully realised?

Preventing what?

It is becoming increasingly common to hear the word ‘prevention’ used in the context of tackling child poverty, but in three distinct senses which are prone to being conflated. First, prevention can refer to reducing child poverty in order to prevent a range of adverse outcomes further downstream, given that poverty is a key driver of inequalities in health and many other domains. Second, it can refer to preventing child poverty itself as the outcome of interest. Finally, it can go further upstream to focus on preventing the drivers of child poverty.

Note that this taxonomy is not the same as the distinction between primary, secondary, and tertiary prevention. Those terms are used to categorise actions according to how far ‘upstream’ they prevent a given outcome from occurring. Here, the question is instead what outcome is being prevented, and how that relates to child poverty.

While analytically distinct, these perspectives are closely connected. Interventions that address the drivers of child poverty will also reduce child poverty itself, and may help prevent wider adverse outcomes. Nevertheless, the theory of change needs to be precise if prevention is to truly support decision-making rather than remaining simply a policy aspiration.

Child poverty as a driver

The first meaning of prevention situates poverty as a driver of other outcomes, including health inequalities. Child poverty is identified as being particularly detrimental because its effects can persist over the course of an individual’s life, with the result that poverty becomes self-reinforcing for individuals and self-reproducing across generations. Breaking these cycles can have outsized benefits for health and other outcomes – not to mention the public finances and the economy.

The latest delivery plan acknowledges this preventative potential in broad terms. It also sets out policies that specifically target prevention through early intervention, including expansions of the Family Nurse Partnership Programme and Whole Family Support services in General Practices, as well as the introduction of a Scottish Child Payment premium for under-1s. Reflecting the tentative nature of the plan, these policies are relatively small scale, although a range of existing policies such as Best Start Grants also target young children.

Child poverty as an outcome of other drivers

While poverty is a driver of other outcomes, we can also consider it an outcome in itself, with its own set of drivers. This motivates the idea that poverty itself can be prevented.

The delivery plan mainly adopts this framing in a temporal sense, affirming the importance of supporting households that are at risk of falling into poverty even if their incomes are currently above the poverty line. We know, for example, that a large proportion of families receiving the Scottish Child Payment are not in poverty but still have lower-than-average incomes due to the means-tested nature of the policy.

The plan avoids the more problematic notion that some poverty-reduction policies prevent poverty while others only treat it. When this idea appears elsewhere, it is often framed as a distinction between labour market policies, which are upheld as preventative, and social security policies, which are written off as treatment.

This is arguably a category error: as its name suggests, one the main functions of social security is precisely to prevent families from falling into poverty when they face adverse circumstances. It would be backwards to think that this function would somehow be unnecessary in a strong economy, when a robust benefit system is actually essential for economic dynamism. In any case, given the viciously cyclical nature of child poverty, reducing child poverty through any means can act to prevent further poverty.

Child poverty as an outcome…of other outcomes

The final way to think about poverty and prevention, which does feature in the delivery plan, is about preventing the outcomes that drive poverty. In particular, the plan refers to several policies to prevent homelessness, including recently enacted duties on councils to find accommodation for those at risk and a new commitment to mitigate the ongoing freeze to Local Housing Allowances (LHAs).

Presumably, these policies are included because homelessness is seen as a cause of poverty. One caveat is that most people who are homeless – along with most people affected by the LHA freeze – do not have children. But the real problem is that the reverse channel, from poverty to homelessness, may be even stronger – and both reflect some common, underlying factors. Among others, these include housing and wider cost-of-living pressures, welfare regimes, and structural issues in the labour market.

Root causes

The three causes outlined above correspond to the Scottish Government’s three proximate “drivers” of poverty: costs of living, income from social security and benefits in kind, and income from employment. Consider each of these in turn.

Lower housing costs in Scotland have historically accounted for most of the difference in poverty with the rest of the UK. This began in the early 2000s, when policies that hiked up social rents in England were not adopted in Scotland. The latest statistics indicate that this advantage has persisted – in 2022-25, the difference in child poverty rates before and after housing costs are subtracted from incomes was three percentage points in Scotland, as compared to eight in the UK as a whole.

Given that we are in the midst of a housing emergency, there is clearly still scope for further progress on housing. The same is true for broader cost-of-living pressures, which multiplied during the period of high inflation that followed the pandemic. But in terms of progressing towards the child poverty targets, it is the income side of the ledger that most demands our attention.

UK welfare reforms implemented in the 2010s have been a key driver of rising child poverty rates in recent decades. The abolition of the two-child limit has not fully undone this legacy: the big picture is still that benefits in the UK have not kept pace with earnings, are less generous than in most other developed countries, and do not ensure that families can afford basic essentials.

Against this backdrop, it makes sense that the Scottish Government has mainly focused its anti-poverty efforts on social security. In 2024-25, the child poverty rate in Scotland was seven percentage points lower than it was in the UK as a whole – around five of which are likely to represent the impact of the Scottish Child Payment.[1] If the goal is to reduce child poverty, it is hard to deny that the half-billion pounds allocated to this policy each year is money well spent. And given their imminency, it is also hard to see a route to meeting the child poverty targets that does not involve further benefit increases, which are the most direct way to put money into pockets.

But while we should avoid the aforementioned trap of construing social security as merely treating poverty – along with the implicit dichotomy between work and benefits – there is a valid point to make around the balance between redistribution and what has been called ‘predistribution’. Research commissioned by the Scottish Government shows that exemplar nations experience lower child poverty rates than Scotland and the UK primarily because of their more equal distributions of pre-transfer income, i.e. earnings. Scotland will surely need to follow the precedent of these countries if it wants to emulate their success over the long term.

After all, it was a fundamental shift in the structure of the economy that gave rise to the levels of poverty that children currently experience. During the 1980s, child poverty rates across the UK more than doubled. This reflected not only cuts to social security, but also the deindustrialisation and deregulation of the economy, which radically changed the structure of the labour market as well as the institutional framework in which it is embedded.

A piece of string

Of course, governments cannot transform the economy by decree, and some relevant powers remain reserved. But there is still scope to take a more strategic approach to economic development that places prevention and child poverty reduction at its core.

Actions taken so far by the Scottish Government – as well as those set out in the latest delivery plan – primarily act on the supply side of the labour market. Services such as employability, childcare, and transport are all seen as helping parents access work, which in turn is seen as helping to reduce child poverty.

But without significant action on the demand side, these policies will not be capable of ensuring that good jobs are available for parents to take in the first place. As the great economist John Maynard Keynes might remind us, such an approach would be akin to pushing on a piece of string. This would appear to be borne out by the record of the last half-century, in which large increases in parental employment across the UK have failed to stem large increases in child poverty. There is also the problem that parental employment cannot be increased indefinitely.

What kinds of actions are needed to influence the demand for labour? Although there is scope to intervene directly in the labour market, employers ultimately hire workers to produce and sell goods and services. At one level, this means that the labour market is downstream from the structure of the economy as a whole – and something similar can be said about the housing market. The real question is therefore: what kinds of actions are needed to shift the economy in the right direction?

One promising example is Community Wealth Building (CWB), an approach to economic development that aims to stimulate local economies through public procurement while encouraging inclusive models of ownership. CWB has already been adopted in certain areas of the United States and, closer to home, in the English city of Preston. It’s still early doors, but initial evidence suggests that the approach has generated benefits for mental health, along with wages and employment.

The Scottish Parliament recently passed an Act that obliges the Scottish Government and local authorities to publish action plans setting out how they intend to promote CWB. Clearly, if CWB is to succeed in Scotland, this is only the first step. Yet the child poverty delivery plan makes only one, passing reference to CWB, and only as an example of action that has already been taken.

While economic development is not sufficiently embedded in the tackling child poverty agenda, the converse is also true. Qualitative research commissioned by the Scottish Government in 2022 found that child poverty tends to be seen as a peripheral issue in the context of local economic development initiatives such as City Region Deals, although views vary and there are signs that this may be changing.

To the targets – and beyond

Exactly how far off track we are from meeting the targets has become frustratingly unclear thanks to an ongoing programme of data improvements. But this is a matter of degree: the point remains that we are, almost certainly, off track. In the latest period, levels of child poverty fell by one percentage point across two of the four statutory measures, while persistent child poverty actually rose slightly. The pace of progress will have to increase rapidly if the targets are to be met in four years’ time.

At this juncture, it is more important than ever that the child poverty targets are taken seriously, but also that we look beyond the targets. Achieving structural change in the economy by 2030 is a tall order. But it would be counterproductive if the real urgency of reducing poverty levels led policymakers to deprioritise the strategic actions that are needed to tackle its root causes over the long run, including on the economic front.

There is also a danger that the tackling child poverty agenda is discredited. Missed targets and changeable data do not make a compelling case for further action, particularly at a time of acute fiscal trade-offs. There will presumably need to be a legislative change after the election to amend the absolute child poverty target, which has effectively been rendered obsolete by the data revisions. As Professor Stephen Sinclair flagged in a recent interview with the Fraser of Allander Institute, campaigners will be anxious that this presents an opportunity to delay or dilute the targets – or even repeal them altogether.

Adopting a preventative lens could help revitalise the tackling child poverty agenda, both in terms of strengthening its business case and in terms of sharpening its focus on root causes. It seems plausible, for example, that tackling the most severe forms of poverty could yield the strongest benefits in terms of prevention, including for the public finances. If that were the case – it is an empirical question at the end of the day – it would have significant implications for how policymakers navigate fiscal and strategic trade-offs.

The Scottish Government has announced that it is conducting a pilot project on ‘preventative budgeting’, which involves categorising spend lines according to their preventative impacts. It remains to be seen whether the exercise will become a permanent fixture of the budget process – and crucially, whether it will truly guide decision-making. Nonetheless, it offers a real opportunity for the preventative potential of child poverty reduction to be realised.

The next year will be pivotal. SHERU will be tracking developments closely, with a particular focus on what they mean for tackling health inequalities.

[1] The Scottish Government’s modelling estimates that a wider set of policies are having a cumulative impact of around 10-11 percentage points each year, but these are still mainly benefit policies. Furthermore, some are longstanding policies (meaning they may not drive further reductions in poverty) and some have UK equivalents (meaning they do not fully contribute to the difference in poverty).