Poverty has dire economic as well as social consequences, a study shows
Poverty in the UK costs the average taxpayer £1,200 a year, a major new report has found.
In total, the economic cost of deprivation is £78 billion annually, according to research from the Joseph Rowntree Foundation (JRF).
It got its figures by looking at how the needs of those in poverty – classed as people living on incomes below 60% of the average – impact on government services
The report was compiled by Heriot-Watt and Loughborough universities.
Poverty has a very large, tangible effects on the public purse
It found that £29bn is spent on treating health conditions associated with poverty, £10bn on schools providing initiatives such as free school meals and £9bn is spent on the police and criminal justice systems dealing with higher crime rates in deprived areas
Additionally, £7.5bn goes on children's services and early years provision, such as free childcare for deprived two-year-olds, £4.6bn on adult social care and £4bn on housing.
Researchers say they did not factor in the annual welfare and benefits spend to its total.
Professor Donald Hirsch from Loughborough University, said poverty had "very large, tangible effects on the public purse".
He added: "The experience of poverty, for example, makes it more likely that you'll suffer ill health or that you'll grow up with poor employment prospects and rely more on the state for your income.
"The very large amounts we spend on the NHS and on benefits means that making a section of the population more likely to need them is extremely costly to the Treasury."
While there are widely accepted links between health problems caused by malnutrition or living in unsanitary housing, there is also a link between poverty, stress and mental illness.
There are also clear links to smoking, drinking alcohol, lack of exercise and poor diet.
Poverty becomes compounded, finds the report, when it causes ill health and prevents people from working.
Julia Unwin, the JRF's chief executive, said: "Poverty wastes people's potential, depriving our society of the skills and talents of those who have valuable contributions to make.
"This drags down the productivity of our economy, hinders economic growth, and reduces tax revenue."
Rev Dr Martin Johnstone, secretary of the Church and Society Council, who recently chaired the Scottish Government’s working group on food poverty said that initiatives to tackle poverty had to be led by those with experience of living in poverty.
"The Joseph Rowntree Foundation points to the huge economic costs of poverty in the UK every year – £78billion is an eye-watering amount. Behind that figure however, in my experience, are real people; frequently amazing, incredible and wonderful people whose lives are blighted by the lack of money and often diminished and cut short by illness.
"We need to change this and we can. With plans by the Scottish Government to bring forward new Child Poverty and Social Security legislation, we have a once in a generation opportunity to really change things. We need to grasp that opportunity.
"One of the things that I have learnt over the last number of years is that we will always make a bigger, better and more significant difference in tackling poverty when we directly involve those who experience it on an ongoing basis. So whilst we want to recognise the financial cost, even more we want to see the huge potential of people to flourish and to bring about change."
A government spokesperson said creating a Britain that worked for everyone "means tackling the root causes of poverty".
A Westminster government spokesperson insisted that there are "more people in work than ever before", and that “good progress” is being made on poverty.
