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Poverty and inequality

Although the recent period of economic prosperity meant an increase in affluence and higher living standards for the majority of the population, nearly one-fifth of the UK population were still living in ‘relative poverty' before the economic downturn. However, levels of poverty have decreased since the mid 90’s [1]. Income equality is currently higher in the UK than in other wealthy nations and although it has risen in recent years, it is lower than in the 90’s. [2] However, unemployment is a key driver of poverty and with the UK in recession, levels of poverty are likely to rise substantially, though income inequality may decrease. Furthermore, the ageing population, with its growing associated care needs, is likely to increase the proportion of the population in poverty in the future.

What are the implications?

• VCOs may need to consider their place and role in helping to create a just and equal civil society.
• Increased pressure and demand for the services VCOs provide.
• Increased demand for services in a period of reduced prosperity may lead to more conditional approaches to welfare provision (see policies on rights and responsibilities).
• An increased focus on a society that values self-reliance and personal responsibility (see attitudes to community responsibility).
• Reduced investment in public services targeted at those in poverty may lead to an increase in the role of the VCS in public service delivery as VCOs pick up the pieces from a slimmed down welfare state.
• As competition for resources increases, social tensions, marginalisation and unrest are likely to increase.
• Tough public attitudes to those in poverty may soften if an economic downturn causes levels of poverty to rise which may lead to an increase in numbers of volunteers and individual giving targeted at those in poverty.
• Changes to numbers of volunteers if those in poverty are forced to prioritise employment over volunteering.

Moving forward

An increase in levels of poverty has an impact on the whole of UK society.

• Does your organisation have a role to play in addressing tensions and inequality between groups and giving a voice to disadvantaged communities and groups when resources are scarce?
• Can you provide activities that contribute to a cohesive and inclusive society?
• Could your organisation learn more about how to break cycles of poverty and how to address its causes?

A recession will put pressure on the sector to respond to more beneficiaries as well as new types of people who may have never experienced poverty before.

• Will your organisation see an increased need for your services? Are you ready to respond to this?
• Could collaborating with other organisations ease some of the demand for your services?

A recession and increased levels of poverty may soften the public attitudes to those in poverty.

• Can you use this opportunity to raise awareness of some of the issues that those in poverty might face and potentially recruit more supporters or volunteer?

Want to know more?

Paying for long-term care: Moving forward.

Published by: Joseph Rowntree Foundation

Date: 2006

Format: Web

What is it? A report that discusses the inadequacy of funding arrangements for long-term care and highlights the numbers of elderly people that might find themselves in poverty as a result.

How useful is this? As the population ages; the UK’s system for long-term care funding is proving to be both unfair and inadequate. With the detailed use of statistics, the report highlights the major issues involved in this debate and puts forward a case for change. It discusses how lack of funding has resulted in poor staff training and elderly people on modest incomes having to pay large amounts of money to have their needs met. The report compares our systems with countries like Scotland and Germany and discusses how we could adopt some of their policies to achieve improvement.

Other comments:

The English Indices of Deprivation 2007

Published by: Communities and Local Government (DCLG)

Date: 2008

Format: PDF (6630kb)

What is it? A report summarising the results of the Index of Multiple Deprivation for 2007.

How useful is this? The Index of Multiple Deprivation is the measure used by government when analysing, assessing and identifying disadvantaged areas across England and allocating resources. It contains a number of indicators and converts a range of economic, social and housing issues into a single deprivation score for each small area in England. The indices of deprivation provide a detailed breakdown of levels of deprivation and poverty within different small areas and regions in England which can be compared or ranked relative to one another. The report provides information and statistics on a wide range of factors that affect levels of deprivation such as: income, employment, health and disability, education skills and training, barriers to housing and services, living environment, and crime. The different maps of the indices in ‘Chapter 5: The Geography of Deprivation’ are easy to read to compare different areas and regions across England.

Other comments: The previous index was produced in 2004, the summary can be downloaded here (PDF 158 kb).

Poverty and Equality in the UK: 2009

Published by: The Institute of Fiscal Studies

Date: 2009

Format: PDF (651KB)

What is it? This annual report looks at the current living standards of different population groups and inequality of income in the UK.

How useful is this? The report contains up-to-date statistics on standards of living, poverty and income inequality trends and assesses the changes that have occurred since Labour came to power, with a particular focus on the changes that have occurred in the latest year of data. It also includes a regional breakdown of poverty levels across the whole of the UK. The analysis is based upon the latest figures from the Department for Work and Pensions' Households Below Average Income (HBAI) series, published in May 2009. The HBAI series takes household income as its measure of living standards, and is derived from the Family Resources Survey, a survey of around 25,000 households in the United Kingdom that asks detailed questions about income from a range of sources.

Other comments:

The Poverty Site

Published by: The Joseph Rowntree Foundation

Date: Ongoing

Format: Web

What is it? A website that monitors what is happening to poverty and social exclusion in the UK.

How useful is this? This website contains a variety of information in different formats about poverty. All data is the latest available from official sources. The material is organised around 100 statistical indicators covering all aspects of the subject, from income and work to health and education and covers all parts of the United Kingdom, with specific sections for Scotland, Wales and Northern Ireland. The indicators and graphs can be viewed by age group or by subject. There are also interactive maps where sub-regional data is available. The key facts section is particularly useful for a short summary of the stats and analysis for different factors affecting poverty such as work, income, education, older people and ethnic minorities. For more detail, there is a report section which focuses on different indicators of poverty and parts of the UK.

Other comments: This website has replaced the Joseph Rowntree’s yearly analysis ‘Monitoring Poverty and Social Exclusion’ but previous editions of reports are available on the site.

References

1. Defined by the Joseph Rowntree Foundation as households living on less then 60% of median income after deducting housing costs, ‘Monitoring poverty and social exclusion’ [back]
2. OECD – Organisation for Economic Co-operation and Development [back]