Saturday, December 04, 2010

Who Has Our Children?

The Major's very bad dream

Following yesterday's blog on the problem of bad parents, we've taken another look at who is actually having Britain's children.

The Major is constantly telling us (eg see here) that the welfare state has produced far too many children at the bottom of the heap. He reckons that by paying the poor and feckless to have children we've given ourselves a monstrous problem. Generation upon generation of feckless no-hopers, reproducing like Fibonacci's rabbits, and threatening to undermine a billion years of Darwinian progress.

And while the Major does tend to put things somewhat bluntly, round our way that is a very widely shared view.

The trouble is - as we saw here - actual facts are very thin on the ground.

But we've now taken a closer look at the latest Office for National Statistics data on income distribution across households of different types (see here). And we've extracted the number of children in households according to their income level.

Across the whole country there are 12.9 million dependent children spread across 19.1m non-retired households, an average of 0.67 children per household. But when you look at the distribution of children across each household income level, you find that households in the bottom 20% of incomes have an average of 1.03 children, while those in the top 20% have an average of 0.34.

What that means is that the poorest 20% of (non-retired) households have over 30% of Britain's children. Whereas the richest 20% only have 10% of the children. That is a pretty striking contrast - our economically least successful households have nearly one-third of our children.

Here's the complete picture (note - 20% income bands are known as quintiles):


And to put some more flesh on this, the gross income of the bottom 20% of households before taking account of welfare benefits averages just £7600 pa. Cash welfare benefits add a further £6300 pa.

So what should we make of this? Is the Major right?

Well, it's clearly the case that the poor have considerably more children in their households than the rich. Yes, some of that is because the rich tend to be a bit older, and their kids may have flown the nest. But even if we restrict the comparison just to households with children, those at the bottom have an average of 2 children, whereas those at the top top have just 1.5.

And it's also true that welfare constitutes a big chunk of household income for the poor - getting on for half their average gross income.

But does that mean it's welfare that's delivered all those poor kids?

In an age of readily available contraception where child labour has long since been abolished, simple economics suggests that the poor should have fewer children than those with higher incomes. That's surely straightforward.

And it's also straightforward that paying welfare based on a household's number of children, must increase the attraction of having children.

But does that prove the Major's right?

What if the poor comprise a whole bunch of people who are incapable of thinking and behaving according to economic rationality? It must be said none of us are always great at doing that.

What if we cut child welfare payments only to find ourselves with just as many poor kids, only now they're starving?

Well, it could happen - we can never answer these questions ahead of time, and in the abstract anything is possible.

But Tyler has seen enough to know there's a serious problem with our current welfare system. Nobody wants children starving in gutters, but it can't make sense to subsidise the 20% of our poorest households to produce 30% of our children.

1 comment:

  1. Anonymous11:48 am

    The income/children distribution is not useful if it does not take account of other factors e.g. age distributions. It could be that a high proportion of the top quintile are retired.

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