Normas de valoración

Table 11a summarises the main findings of the analysis of the main determinants of the risk of child poverty presented above. In the first column, countries are assessed according to their relative performance in child poverty outcomes, into 6 levels from +++ (countries with the highest performance) to --- (countries with the lowest performance) using the framework described in chapter I.1 and the detailed method in annex (Table A16). Child poverty outcomes are assessed using a score30 summarising the relative situation of

30 _{See detailed description of the method in Table A16. The scores are z-scores used to rank countries and to} identify 6 levels of relative performance, from +++ to ---. The levels are defined to ensure that within each level the performances of countries are similar and that there is a significant step between levels.

children in a country with regard to: a) the poverty risk for the overall population in that country, b) the average child poverty risk for the EU as a whole, and c) the average intensity of poverty risk for children (poverty gap) at EU level.

In the next three columns, countries are assessed according to their relative performance (also using a 6 levels scale) with regard to the three main factors influencing child poverty risk31, namely: children living in jobless households, children living in households at risk of "in-work poverty" and the impact of social transfers on the risk of child poverty (see chapters I.3 and I.4).

The analysis allows establishing a diagnosis of which combination of the 3 key factors predominantly affects each country's risk of poverty and to gather countries into 4 groups accordingly.

Information on the key characteristics of the households with children provided in table 11b completes the picture (see also chapter I.2). In the EU, half of the poor children live in the 2 types of households that are most at risk of poverty: 23% live in lone-parent households and 27% in large families. However, the extent to which lone parent households and large families experience greater risks of poverty both depends on their characteristics (age, education level of parents, etc.), and on the labour market situation of the parents (joblessness, in-work poverty, etc), which can be influenced by the availability of adequate support through access to enabling services such as childcare, measures of reconciliation of work and family life, and in-work income support.

In the EU, children whose parents are below 30 have a significantly higher risk of poverty than those living with older parents: 27% when the mother is below 30; against 19% when the mother is between 30 and 39, and 16% when she is between 40 and 49. The age of the parents is indeed a determinant of the financial situation of households with children insofar as in all countries, in-work earnings show a strong progression from the early 20’s until the mid 50’s. Besides, the incidence of joblessness is greater among the youngest32. The educational level of parents is another key determinant of children’s current and future situation since it impacts both on the current labour market and income situation of the parents and on the children’s own chances to do well at school33_{. In the EU, most} children are raised with at least 1 of their parents having fulfilled secondary education. The parents’ education profile of poor children differs significantly from their peers, since for more than 30% of poor children none of the parents reached a secondary level of education (against 16% for all children), and only 16% of them have a parent with upper education (against 32% for all children).

31 _{The method used to define the 6 levels of performance for the 3 risk factors is the same and combines:} - the share of children in jobless households in one country is compared with the share of adults in jobless households in this country and with the EU average share of children in jobless households; - in-work poverty of children in one country is compared with in-work poverty of adults in this country and with the EU average in-work poverty rate for children;

- the impact of social transfers (excl. pensions) on child poverty in one country is compared to the EU average.

32 _{EUROMOD working paper N° EM3/06; T-T Dang, H Immervoll, D Mantovani, K Orsini and H} Sutherland; An age perspective on economic well-being and social protection in nine OECD countries; September 2006.

33 _{See chapter of the ISG Task-Force report analysing the results of the SILC 2005 module on the} intergenerational transmission of disadvantage.

47 Table 11a: Relative outcomes of countries related to child poverty risk and main

determinants of child poverty risk Child poverty risk

outcomes Joblessness: children living in jobless households In-work poverty: children living in households confronted with in-work poverty Impact of social transfers (cash benefits excl. pensions) on child poverty AT ++ + + ++ CY +++ + ++ - DK +++ + +++ ++ FI +++ ++ +++ +++ NL + + + + SE +++ (++) +++ +++ GRO U P A SI ++ +++ ++ ++ BE + -- ++ + CZ - -- + + DE ++ -- +++ ++ EE -- -- + - FR ++ - ++ ++ GRO U P B IE - --- + + HU - --- -- ++ MT - -- --- -- SK - --- - - GRO U P C UK + --- - + EL + +++ - --- ES -- + --- --- IT -- ++ --- -- LT --- + --- -- LU + +++ -- + LV -- - - -- PL --- - --- -- GRO U P D PT -- + --- -- BG -- --- : : RO -- -- : :

Source: Table 1, Figure 7, Figure 11, Figure 13 and Table A8, and Table A16. BG and RO cannot be included in the full assessment since data are missing for the in-work poverty and the impact of social transfers.

Table 11b: Key characteristics of households with children

Share of children living in lone parents + large

families <28%

Share of children living in lone parents + large

families Between 28 and 40%

Share of children living in lone parents + large

families > 40% % of children in large families and lone parent

households CZ, EL, ES IT, PL PT, SI, SK

EE, FR, CY, LV LT, LU, HU, MT, AT, SK

DK, DE, FI, SE, NL, BE, IE, UK % of children whose mother is below 30 <15% % of children whose mother is below 30 Between 15% and 20% % of children whose mother is below 30 >=20% % of children at- risk of poverty whose mother is

below 30 DE, ES, IT, MT, NL

DK, EE, IE, EL, FR, LT,

LU, AT, PT BE, CZ, CY, LV, HU, PL, SI, SK, FI, SE, UK % of children whose

parents are low skilled <=10%

% of children whose parents are low skilled Between 10% and 20%

% of children whose parents are low skilled

>=20% % of

children whose parents are

low skilled CZ, DE, EE, FR, LV, LT, _{AT, PL, SI, SK, FI, SE} BE, DK, CY, HU, NL UK, EL, LU, IE, IT, ES, _{PT, MT} Source: Tables A6a, A6c and A9

The detailed analysis of Tables 11a and 11b confirms that child poverty outcomes result from complex interactions between joblessness, in-work poverty and the impact of transfers (the 3 main factors presented in Table 11a) and that the countries achieving the best outcomes are those that are performing well on all fronts, notably by combining strategies aimed at facilitating access to employment and enabling services (child care, etc.) with income support.

It is worth noting here that once reliable trend data become available from EU-SILC, a dynamic dimension will have to be added to the proposed diagnosis. This will allow taking account of the increase in child poverty observed in a number of countries (on the basis of national data), and notably in SE and FI that are identified here as best performers in relation to other EU countries. This observation calls for the need to closely monitor child poverty outcomes within a country and to raise the governments' accountability, notably by setting quantified objectives (see part III of the report on recommendations). The detailed description of the 4 groups follows:

• Group A gathers the three Nordic countries (DK, FI, SE) as well as AT, CY, NL, and SI. These countries reach relatively good child poverty outcomes by performing well on all 3 fronts. They combine relatively good labour market performance of parents (low levels of joblessness and of in-work poverty among households with children) with relatively high and effective social transfers. Nordic countries achieve these goals despite high shares of children living in lone parent households. They seem to succeed in so doing notably by supporting adequate labour market participation of parents in these families through childcare provision and a wide range of measures of reconciliation of work and family life. While the impact of social transfers on child poverty is relatively low in CY, children in this country have so far been protected against the risk of poverty by strong family structures dominated by 2-adults families and complex households in which most working age adults are at work. In the NL, while children in part benefit from the low levels of inequality in the country and from a relatively good integration of parents on the labour market, child poverty outcomes

49 may be further improved by addressing the intensity of poverty and improving the impact of social transfers (which is lower than for other countries in this group).

• Group B gathers BE, CZ, DE, EE, FR, and IE which achieve relatively good to below average poverty outcomes. The main matter of concern in these countries is the high numbers of children living in jobless households. While 8% of children or more live in families suffering from joblessness, families at work experience lower levels of poverty than in other EU countries. In most of these countries, around half of the children in jobless households live with a lone parent. In FR the high numbers of children living with jobless couples is also a matter of concern. Among these 6 countries, DE and FR seem to be more successful at limiting the risks of poverty for children than the others through relatively high and effective social transfers. The interaction between the design of these benefits, the availability and affordability of child care and the labour market participation of parents would deserve further analysis34. Policies aimed at enhancing access to quality jobs for those parents furthest away from the labour market may contribute to reducing child poverty in these countries.

• Group C gathers HU, MT, SK, and the UK who record average or just below average child poverty outcomes, despite a combination of high levels of joblessness and in- work poverty among parents. In the UK, joblessness mainly concerns lone parents, while in HU, MT and SK it concerns mainly couples with children. The main factors of in work-poverty are low work intensity in MT (very few 2-earners families) and the UK (incidence of part-time work) and low pay or low in-work income in HU and SK where the poverty rates of 2 earners families are among the highest in the EU. In this group of countries, the UK and HU partly alleviate very high risks of pre-transfers poverty among children through relatively effective social benefits. In MT and SK, despite the relatively poor integration of their parents on the labour market, children benefit from low pre-transfers risk of poverty, probably as a result of family structures that so-far remain protective; in SK the rather narrow income distribution may also play a role. In these 4 countries, different policy mixes may be needed to give access to quality jobs to parents living in jobless households, to enhance the labour market participation of second earners and to adequately support the incomes of parents at work.

• Group D gathers EL, ES, IT, LT, LU35, LV, PL, and PT. These countries record relatively high levels of child poverty (except LU). While they have low shares of children living in jobless households, they experience very high levels of in-work poverty among families. The main factors of in-work poverty in these countries are the low work intensity (the number of 2-earners families are among the lowest in ES, EL, IT, LU, PL) combined (or not) with low in-work incomes (the poverty rates of 2 bread winners households are among the highest in ES, EL, LT, PT and PL). In these countries (apart from LU), the level and efficiency of social spending are among the lowest in the EU. The analysis indicates that in these countries family structures and intergenerational solidarity continue to play a role in alleviating the risk of poverty for the most vulnerable children. Living in multi-generational households and/or relying

34 _{See make work pay analysis including child care costs components in the 2007 edition of Benefits and} Wages, OECD.

35 _{It has to be pointed out that the relatively high risk of in-work poverty of households with children in LU} is partly the result of a specific structure of the population where the share of high income households without children is higher than in other countries.

on inter-households transfers whether in cash or in kind36 may partly compensate the lack of governmental support for the parents in the most vulnerable situations. These countries may need to adopt comprehensive strategies aimed at better supporting families' income, both in and out of work, and at facilitating access to quality jobs, especially for second earners.

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