Relative poverty is increasing on practically every level
Anti-poverty campaigners have called for action after new research found families are struggling as income has dramtically dropped.
Research from the independent think tank Resolution Foundation showed that in 2003 households on the lower half of incomes typically earned £14,900 while in 2016/17 that figure had fallen to £14,800.
It also showed there was a 3% increase in child poverty in the UK last year.
The research shows a reduction of up to £150 in the incomes of the lowest income households across the UK.
Child poverty has been rising since 2011 at a higher rate than suggested by government data, driven by benefit cuts which have had a disproportionate impact on families experiencing poverty, researchers claimed.
The Poverty Alliance responded by calling for a rethink in the UK government’s social security policies, and by highlighting the solutions that can help to free people from the grip of poverty.
Peter Kelly, director, said: “This report underlines what we already know to be true; that decisions made by policy-makers, such as to introduce and maintain the benefits freeze, are locking people into poverty.
“In the just and compassionate society we all want to live in, child poverty should not exist. Yet this research shows that child poverty increased in the last year in the biggest single year increase since the 1980s; this cannot be right.”
“There are actions we can take to reverse this – we can end the benefits freeze, for example, and we can ensure that we are all able to access an adequate minimum income to guarantee a decent standard of living can be had by everyone. This Resolution Foundation research reinforces why that action is so vital.”
There are now over eight million low and middle income households, just under half of which have children.
Lower income households actually going backwards - Resolution Foundation
On average, incomes for all households in 2017/18 increased by just 0.9%, the lowest rise for four years and less than half the average between 1994 and 2007, just before the financial crisis.
The Resolution Foundation report said that surveys revealed that over 40% of low to middle income families feel they would be unable to save £10 a month and over 35% would be unable to afford a holiday for one week with their children.
"We appear to have a picture of generalised stagnation for many, with lower income households actually going backwards," the Resolution Foundation's Living Standards Audit says.
"The apparent falling away of the bottom from the middle in 2017/18 represents a disturbing new development.”
Non-wage costs have also increased. Businesses now have to pay more into employees' pensions and, for larger firms, have to pay costs such as the apprenticeship levy to encourage better standards of training.
Benefit cuts since 2010 also affect lower income households far more than those on higher incomes, the report states.
