The substantial falls in pensioner and child poverty were largely driven by very significant additional spending on benefits and tax credits. Reforms since 1997-98 resulted in an £18 billion annual increase in spending on benefits for families with children and an £11 billion annual increase on benefits for pensioners by 2010-11 (
see here). Our modelling suggests that child and pensioner poverty would either have stayed the same or risen, rather than fall substantially, had there not been these big spending increases. Meanwhile, Labour’s tax and benefit changes had relatively little net impact on the top half of the income distribution, or on low-income adults without dependent children – the group whose poverty rate did not fall. However,
there is evidence to suggest that these reforms prevented a larger rise in inequality than actually occurred under Labour.