THE annual report by the New Policy Institute gives a comprehensive picture of poverty in the UK and graphically re-proves the need for a socialist revolution.
It shows that more than half of the 13 million people living in poverty in the UK in 2011/12 were in a working family, and that about five million were paid below the living wage.
The report also shows that the number of people in low-paid jobs has risen and average incomes have fallen while 4.8 million different people have claimed Jobseeker’s Allowance in the last two years, proving that secure employment is very hard to come by.
While the proportion of pensioners in poverty is at its lowest for almost 30 years, the proportion of working-age adults without children in poverty is the highest on record.
Average incomes have fallen by eight per cent since their peak in 2008.
As a result, around two million people have a household income below the 2008 poverty line but are not considered to be in poverty today.
Following recent changes to the social security system, many people on means-tested benefits have reduced incomes.
Around 500,000 families face a cut in Housing Benefit via the under-occupation ‘Bedroom Tax’ penalty and a reduction in Council Tax Benefit.
The number of sanctioned jobseekers with a reduced entitlement to JSA doubled in 2010 to around 800,000.
The level of benefits for an out-of-work adult without children now covers only 40 per cent of what the public considers to be a minimum standard of living. For families with children this figure is no more than 60 per cent.
The most widely used measure of poverty is based on household income. A household is considered to be in poverty if its income, after taxes have been paid, and adjusting for the household size and composition, is below 60 per cent of the national median that year.
As the median income rises, the amount of money required to be above the poverty line rises. As median income falls, so does this threshold.
Median incomes in the UK in 2011/12 are now, in real terms, just below what they were in 2001/02 (£367 a week compared with £368). From their 2007/08 peak, they have fallen 8 per cent. This means that people may be no better off, but rather the poverty line has fallen from above their income level to below it!
This has been the experience for around two million people, whose incomes mean they would have been in poverty under the 2007/08 poverty line, but are considered not to be in poverty in 2011/12!
The proportions of different groups of people in poverty have changed over the last 30 years, with corresponding changes to the composition of poverty. In 2011/12, the proportion of pensioners living in poverty had fallen to 14 per cent, its lowest rate for almost 30 years. Child poverty has fallen to 27 per cent, its lowest rate for almost 25 years.
At the same time, poverty among working-age adults with children remains at 23 per cent, broadly in line with the previous few years.
Among working-age adults without dependent children, the proportion living in poverty is now 20 per cent. This is the highest in at least 30 years, having risen quite steadily over that period. Uniquely, poverty among this group did not fall when median incomes fell.
These changes become even more apparent when we consider the composition of those in poverty. In 1982, there were similar numbers of children, pensioners and working-age adults (with or without children) living in poverty. Even as poverty rose in the next ten years, the distribution across age groups remained broadly similar – four million children, three million pensioners, three million of working-age adults both with and without children.
By 2012, however, this has changed completely. There are now around 3.5 million children in poverty, three million parents, 1.5 million pensioners and 4.5 million working-age adults without children. So despite parents having a greater risk of poverty, there are many more non-parents living in poverty.
For the first time in the data series, there are more people in poverty in working families than in workless working-age and retired families combined.
The UK is on the way to being a nation of coolies, with tens of millions living in poverty.
Capitalism has clearly had its day. The time has come for a socialist revolution.
