UK: The JRF 2017 Poverty Report

The following facts and figures come from the latest Joseph Rowntree Foundation 2017 UK Poverty report. It highlights that overall, 14 million people live in poverty in the UK – over one in five of the population. This is made up of eight million working-age adults, four million children and 1.9 million pensioners. 8 million live in families where at least one person is in work.

 

Over the last 20 years, the UK has dramatically reduced poverty among people who had traditionally been most at risk – pensioners and certain types of families with children. But that progress is beginning to unravel; poverty rates for both groups have started to rise again.

 

The analysis highlights that the three factors which have led to a fall in poverty and are now under question; state support for many of those on low incomes is falling in real terms, rents are increasing, and rising employment is no longer reducing poverty.

 

Overall poverty

Poverty among children and pensioners has risen in the last few years.

30% of children and 16% of pensioners now live in poverty.

One in eight workers live in poverty – 3.7 million.

47% of working-age adults on low incomes spend more than a third of their income (including Housing Benefit) on housing costs.

More than a third of working-age adults receiving Housing Benefit now have to top it up out of their other income to cover their rent.

30% of people living in a family with a disabled member live in poverty, compared to 19% of those who do not.

Nearly a quarter of adults in the poorest fifth of the population experience depression or anxiety.

More than one in 10 working-age adults in the poorest two fifths, and around one in six pensioners in the poorest fifth, are socially isolated.

20% of those in the poorest fifth have ‘problem debt’

70% of people in work are not contributing to a pension

 

Children and parents

Poverty rates are consistently highest among children and their parents. The groups with highest poverty are lone parent families and families with three or more children. Poverty rates fell significantly for these groups over the last 20 years.

In 1994/95, 58% of lone parents lived in poverty, falling to 41% in 2010/11 before rising again to 46% in 2015/16.

In 1994/95, 45% of children in families with three or more children lived in poverty, falling to 32% by 2012/13 before rising again to 39% in 2015/16.

Poverty among families with children is rising, largely due to reductions in the support offered by benefits and tax credits.

Tax cuts and minimum wage rises are beneficial for some, but for many low-income families, the gains are far outweighed by reductions in the more targeted support given by the benefit and tax credit system.

3.7 million workers live in poverty.

Of the 12 million working-age adults and children in poverty, 8 million live in families where at least one person is in work.

Poverty rates among couples without children have always been low and have changed very little with around one in ten in poverty throughout.

Levels of poverty among single people without children have also been fairly steady – around a quarter were in poverty in 1994/95, rising to 28% in 2009/10 and falling back to a quarter by 2015/16.

 

Real inflation

Increasing costs for essential goods and services have exacerbated the financial pressures faced by families on low incomes.

47% of working-age adults in the poorest fifth of the population now spend more than a third of their income (including Housing Benefit) on housing costs; up from 39% in 1994/95.

Since 2003, overall inflation has been higher for people on low incomes than for those who are better off.

 

Homes and disability

The proportion of homes which do not meet minimum standards of covering safety, state of repair, facilities and thermal comfort has fallen over time but those on low incomes remain more likely to live in these houses than those who are better off. In England, just over one in five of people in the poorest fifth of the population live in ‘non-decent’ homes.

Disability is strongly linked to poverty – 30% of people in families with disabled members live in poverty

In England and Northern Ireland, at age 16 young people from poorer backgrounds are around a third less likely to achieve good qualifications than better-off students.

 

Education

Since 1996, there has been a large decrease in the proportion of working-age people with no qualifications and an increase in the proportion with higher education and degree level qualifications.

Since 1996, the proportion of working-age adults with higher education qualifications has nearly doubled in England, Wales and Scotland; 45% of working age adults in Scotland, 38% in England and 35% in Wales have these qualifications.

 

Debt

20% of those in the poorest fifth report having ‘problem debt’, compared to 11% of the second poorest fifth and just 1% of those in the richest fifth. Only 30% of people in work in the poorest fifth of the population are contributing to a pension scheme, compared to 67% of those in the richest fifth.

 

Conclusion

The prospects for solving UK poverty are worrying. The continuing rise in employment is no longer leading to lower poverty. Changes to benefits and tax credits for working-age families are reducing the incomes of many of those on low incomes.

High housing costs continue to reduce the incomes available for those in poverty to meet other needs. Inflation is rising and is higher for those on lower incomes than for better-off groups. This squeeze on living standards is also storing up problems for the future; a fifth of people on low incomes have ‘problem debt’; most are not building up a pension; the decreasing proportion of the working-age population buying their own home means that in the future more older people are likely to rent and have higher housing costs in retirement.

The UK has seen considerable success in improving skills and increasing employment. However, the majority of young people from disadvantaged backgrounds still do not achieve five good GCSEs and there is still a group of adults with no or low qualifications who are at an increasing disadvantage in the labour market.

Part-time workers are particularly vulnerable to poverty, with a poverty rate more than twice as high as full-time workers, and qualifications are far less effective in improving their pay prospects than for full-time workers.

The impact of poverty on physical and mental health and on relationships within families add to the disadvantages facing those living on low incomes. Enabling those in poverty to improve their incomes and reduce their costs, as well as addressing the negative impacts of low incomes, would help to prevent future poverty.

 

 

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