A joint initiative between the Scottish Government and the Scottish Football Association is supporting low-income families.
Launched by the First Minister with a £2million Scottish Government investment last year, the programme provides before-school, after-school and holiday activities for around 2,700 children each week.
The Extra Time programme aims to tackle poverty by delivering accessible and affordable activity clubs for children from low-income families.
During a visit to Dundee United Sports Club, which received £95,000 from the fund and provides support during term time and school holidays, Deputy First Minister Shona Robison said: “School holidays should be a time for fun and enjoyment for children, but for many families it is a time of added financial pressure.
“Scotland currently has one of the most generous childcare offers in the UK, and our investment in early learning and childcare, and school age childcare, is a key part of our goal to tackle child poverty.
“We are committed to building a system of school age childcare that helps to support parents and carers into employment, training or study. Our investment is helping to reduce inequalities that exist for children from lower income families who might otherwise struggle to participate in activities before or after school or during the holidays.
“Our Extra Time partnership with the Scottish Football Association is in the early stages of delivery, but we are already seeing the positive impacts that access to term time and holiday clubs are having on both children and parents.
“For example, we have early evidence from families that they feel better supported to work, with children seeing the benefits of increased physical activity as well as other benefits such as improved attendance, and improved behaviour at school’.
Chief Executive of the Scottish Football Association, Ian Maxwell, said: “It is fantastic to see the impact this vital programme is already having across the country since its launch last year, building on the initial success of the pilot in Ayr.
“Every child should have the opportunity to experience our national game and play with their friends within their local communities. There is no doubt that initiatives such as the Extra Time programme help remove barriers for children and their families around accessing after school and holiday activity clubs.
“We are appreciative of the continued support of the Scottish Government on this project, as we continue to pursue avenues in which the power of football can make a tangible difference in the lives of people in Scotland.”
controversial two-child limit on benefits a key driver, says CPAG
YESTERDAY’Sofficial poverty statistics show child poverty has reached a record high with an estimated 100,000 more children pulled into poverty last year.
The DWP’s annual Households Below Average Income shows 4.3 million children (30%) were in poverty in the year to April 2023. It shows:
100,000 more children were pulled into relative poverty (after housing costs). That means 4.3 million children (30% of all UK children) were in poverty – up from 3.6 million in 2010-11.
69% of poor children live in working families
46% of children in families with 3 or more children are in poverty, up from 36% in 2011/12.
Poor families have fallen deeper into poverty: 2.9 million children were in deep poverty (i.e. with a household income below 50% of after-housing-costs equivalised median income) 600,000 more than in 2010/11
36% of all children in poverty were in families with a youngest child aged under five
47% of children in Asian and British Asian families are in poverty, 51% of children in Black/ African/ Caribbean and Black British families, and 24% of children in white families
44% of children in lone parent families were in poverty
34% of children living in families where someone has a disability were in poverty
Alison Garnham, Chief Executive of Child Poverty Action Group and Vice-Chair of the End Child Poverty Coalition, said: “In a general election year, nothing should be more important to our political leaders than making things better for the country’s poorest kids.
“But child poverty has reached a record high, with 4.3million kids now facing cold homes and empty tummies.
“We know that change is possible but we need to see a commitment from all parties to scrap the two child limit and increase child benefits. Anything less would be a betrayal of Britain’s children.”
Liv Eren 20, who grew up in poverty, says: “As an 8-year-old I couldn’t go on the school trip, as a 12-year- old I was wearing last year’s school blazer and that feeling – that knock to your self-esteem – never really leaves you.
“People say growing up in hardship can motivate you, but what could I do aged 8 or 12?. It’s awful.”
Schools are seeing the effects of rising child poverty every day.
Tom Prestwich, Headteacher at Jubilee Primary School in Lambeth said: The levels of poverty we are seeing in school now and the numbers of children affected by it, are the worst I have seen.
“This can have a significant impact on our pupils’ ability to learn and on their overall wellbeing. Pupils who are coming to school hungry, pupils who are overtired because they are struggling to sleep in difficult home conditions, pupils who are cold or uncomfortable because of the clothes they have to wear are all at a disadvantage right from the start of their day.
“We do as much as we can to counteract this. We have breakfast clubs, give out fruit and bagels every day, give out old uniforms and support as much as we can with parents battling for improved housing but it does feel like the gap between disadvantaged and non-disadvantaged families is widening.
“This is happening at a time when school budgets are ever more stretched and our capacity to help and support families is reduced as a result.”
Simon Kidwell, head teacher at Hartford Manor Primary School in Cheshire, and president of school leaders’ union NAHT, said: “At my school even working families are accessing local food banks and seeking support with uniform and school trip expenses.
“We hear from our members how schools are increasingly finding themselves having to step in and support pupils and families, with local authority budgets stretched to breaking point.”
In addition to the rise in relative child poverty (measured as living on less than 60% of today’s median income) the DWP’s figures show an increase in the number of children in absolute poverty (measured as living on less than 60% of what the median income was in 2010).
Since absolute poverty should always reduce over time as living standards generally rise, the increase is a clear warning that not only are more children being dragged below the relative poverty line, but living standards for children are falling over time, their hardship deepening.
Commenting on the publication of the latest official figures on UK poverty, which show that the number of people living below the poverty line in working households is 1.6 million higher than in 2010, TUC General Secretary Paul Nowak said:“Hard work should pay for everyone. But millions of working families in this country are struggling to cover even the basics.
“In-work poverty has rocketed over the last 14 years.
“The Tories have presided over epidemic levels of insecure work, brutal cuts to social security and years of feeble wage growth.
“Working people deserve far better.”
Households Below Average Income statistics can be found here:
Latest Accredited Official Statistics and Official Statistics published
Covering the period until March 2023, the latest statistics show little recent change in poverty levels for children and pensioners. Poverty for working-age adults is slightly higher than in recent years, which could be driven by people becoming economically inactive as a result of the pandemic.
The four child poverty measures in the Child Poverty (Scotland) Act (relative and absolute poverty, combined low income and material deprivation, and persistent poverty) are broadly stable over the recent period. These measures are based on single-year figures which tend to fluctuate year on year, and the three-year averages provide a robust indication of trends.
While the poverty risk is much lower for children where someone in the household is in paid work compared to those in workless households, not all work pays enough to lift the household above the poverty line. Over two thirds of children in poverty live in a household with someone in paid work. This proportion has increased markedly over the past decade or so as more people move into employment.
Other key points are:
Working-age adults (21%) and pensioners (15%) are less likely to be in relative poverty after housing costs compared to children (24%).
Relative poverty has been broadly stable for all age groups. Adults under 25 are more likely to be in poverty than older adults.
Minority ethnic households are more likely to be in poverty compared to white British households. Muslim adults have higher rates of poverty compared to adults of Christian and those with no religion. Some of this difference may be explained by these households being younger.
The two full statistical publications are available here:
Poverty and Income Inequality in Scotland contains statistics on poverty, child poverty, poverty risks for various equality characteristics, household income and income inequality for Scotland. This report also includes statistics on household food security.
The data comes from the Department for Work and Pensions’ (DWP) Family Resources Survey, Households Below Average Income dataset. Comparable UK income and poverty figures are published on the same day by DWP.
Figures are presented as three-year averages of each estimate. Three-year estimates best identify trends over time. Data collected during the year between April 2020 and March 2021 are excluded from the most recent estimates as response rates were affected by the COVID-19 pandemic. As a result, estimates covering this period are for two years rather than three.
The four child poverty measures in the Child Poverty (Scotland) Act are based on single-year figures. These are available in the reference tables and in the child poverty summary.
Persistent Poverty in Scotland presents estimates of the proportion of people in Scotland who live in persistent poverty. The data comes from the Understanding Society Survey, and the latest statistics cover the period from 2018 to 2022.
These poverty statistics are used by the Scottish Government and other organisations to monitor progress in tackling poverty and child poverty, and to analyse what drives poverty and what works for tackling poverty and income inequality.
Relative poverty: A person is in relative poverty if their current household income is less than 60% of the current UK median. Increases in the proportion of people living in relative poverty indicate that the gap between the poorest and middle income households is widening.
Absolute poverty: A person is in absolute poverty if their current household income is less than 60% of the UK median in 2010/11, adjusted for inflation. Increases in the proportion of people living in absolute poverty indicate that prices are rising faster than the incomes of the poorest households.
Combined low income and material deprivation identifies the number of children in families that cannot afford basic essential goods and services because of a low income (below 70 percent of the middle household income).
Persistent poverty identifies the number of people in relative poverty for three or more out of four years. People who live in poverty for several years may be affected by it through their lifetime.
Household income is adjusted for household size.
The poverty publications present poverty figures before and after housing costs. Before housing costs figures are a basic measure of household income from earnings and benefits. After housing costs figures subtract spending on rents, mortgage interest payments and other unavoidable housing costs from this basic income.
In Scotland, poverty statistics focus mainly on poverty after housing costs. The poverty estimates in the child poverty summary refer to relative poverty after housing costs.
Reacting to figures published today, Independent Age Chief Executive, Joanna Elson, CBE said: “Statistics released today are damning. Over 150,000 pensioners in Scotland are living in poverty with an extremely alarming increase in the number of pensioners living in severe poverty, up more than 30% compared to previous statistics.
“In a compassionate society, no one should have to experience the injustice of poverty and the impact this has on their daily life, health and wellbeing, including people in later life.
“With too many older people continuing to live in poverty and the number in severe poverty growing, it’s evident we need a step change in action from both the UK and Scottish Governments to reverse this alarming trend.
“The UK Government has key levers it can pull to change this. It’s vital there is action to make sure the amount people receive through the State Pension and Pension Credit is enough to live on.
“For this to happen, the UK Government must instigate a cross-party review to establish the adequate minimum level of income needed to avoid poverty in later life, alongside robust plans to get the existing financial support available to every older person.
“The Scottish Government also has a responsibility to recognise the scale of this issue and should respond to these alarming figures by urgently introducing a pensioner poverty strategy. While we have a child poverty strategy, we are unaware of any plans to produce a strategy to reduce poverty in later life.
“As today’s figures show, without a concerted effort from Government, too many older people are being left to suffer in poverty.The time for action is now.“
Today’s official annual poverty figures show that 600,000 more people, half of them children, are living in absolute poverty – the government’s preferred measure of poverty
Today’s official annual poverty figures show that:
600,000 more people, half of them children, are living in absolute poverty, the government’s preferred measure of poverty
This is the second year in a row absolute poverty has increased
In comparison to 2020/21, 900,000 more people are living in absolute poverty, 400,000 of them children
This the joint highest increase in this statistic for 40 years (since 1982) and is the same increase as was seen following the Global Financial Crisis (between 2010/11 and 2011/12)
100,000 more children are living in relative poverty since 2021/22, a slight increase. The overall figure has slightly decreased by 100,000. In comparison to 2020/21, 900,000 more people, 400,000 of them children, are living in relative poverty
Food insecurity has risen dramatically, increasing from 4.7 million people (7%) in 2021/22 to 7.2 million (11%) in 2022/23
Peter Matejic, Chief Analyst at the Joseph Rowntree Foundation, said: “The annual poverty figures published today confirm that the Government failed to protect the most vulnerable from the cost of living crisis. Absolute poverty, the Government’s preferred measure of poverty, has risen for the second year in a row. This is as big as we have seen for 40 years.
“At the same time, there is little to celebrate in the slight fall in overall relative poverty levels. This is largely due to the incomes of middle-income households falling, rather than people on the lowest incomes being better off. This is also likely to reverse now that earnings are growing faster than inflation.
“The Government’s short-term interventions to date haven’t stopped the incomes of poorer households from being swallowed up by the soaring cost of essentials. This is despite Jeremy Hunt speaking of his commitment to protect the most vulnerable in his Autumn Statement in 2022. These results show just how far away our social security system is from adequately supporting people who have fallen on hard times.
“The prospects for people on the lowest incomes should be at the forefront of politicians’ minds as we head into a general election. We need all political parties to treat this rise in poverty with the seriousness it deserves at the coming general election and set out an ambitious plan to reverse it.
“This must involve embedding an Essentials Guarantee into Universal Credit to ensure that everyone has a protected minimum amount of support to afford essentials.”
Save the date! Friday 22nd March 2024, Norton Park Conference Centre
We are pleased to announce that our new Cash First Toolkit – designed to support Community Food staff and volunteers with knowledge, skills and confidence around Cash First – has been published!
Charity warns rising rents and pensioner poverty could be ‘catastrophic’ for older Scottish renters
1 in 7 pensioners in Scotland (150,000) are in poverty, and over half (75,448) of those are renters
New research finds that just 30% of older renters feel fully informed of their housing rights
Older private renters in Scotland are plagued with damp, unsafe and unaffordable homes
Charity calls for the Scottish Government to ensure affordable rents, that tenants’ rights are upheld and rented homes are maintained to a decent living standard
Older Scottish renters living on a low income urgently need greater protections in the upcoming Housing Bill, says Independent Age, the charity supporting older people in poverty.
It says that renters in later life face a “catastrophe” if action is not taken, with record rent increases in recent years and a growing number of older renters across the nation being pushed into poverty.
The organisation today launches its report Homing in: How to improve the lives of older Scottish renters, which uses polling, Government data and a survey of over 500 older renters to understand the reality of renting in later life in Scotland.
Almost two in five (39%) older Scottish private renters now live in poverty, up from 24% a decade before1. Independent Age says that older renters on a low income are “terrified” their rent could rise after the end of the current rent rise cap on March 31st.
The new report has unearthed older tenants’ daily challenges with affordability, the threat of eviction and poor standards. The charity found that less than a third of older renters (30%) feel fully informed of their housing rights while a shocking one in five (21%) saying they know nothing2.Independent Age believes that this worryingly low level of awareness among tenants of their rights in the private rental sector is leaving poor and sometimes unlawful practice unchallenged.
The charity calls on the Scottish Government to ensure:
Private rents are controlled at an affordable level for older people on a low income.
Landlords are required to inform tenants of independent housing advice services when they serve them notice.
A housing ombudsman is established, giving private tenants the ability to challenge issues like poor maintenance.
Tenants are informed of their rights as renters.
Affordability
In Scotland, almost two in five (39%) older private renters live in poverty3, while more than a quarter (28%) of those surveyed say they have less than £200 disposable income a month after paying rent. In the last year, over 4 in 5 (81%) say they have faced a rise in rent of up to £50 a month.
With the temporary limit to rent increases set to end next month, the charity has heard from older people who, faced with increasing costs from all angles, including rent, Council Tax and energy, are struggling to pay their rent.
An older person who is looking for a new property to rent told the charity: “it is really scary how much starting rents have increased in the last six months”.
Independent Age warned that without action to ensure housing affordability in the private rented sector, more older tenants across Scotland will be forced to make difficult decisions such as making further cutbacks to food, energy and water to cover rent.
Housing quality and standards
65% of older Scottish peoples’ homes are in a state of disrepair4. Independent Age’s survey found that 40% of older private renters were not satisfied with the standard or quality of their home5, however polling found that more than 1 in 10 (12%) older private renters questioned feel uncomfortable raising concerns with their landlord, for fear of negative treatment.
Independent Age says that problems with damp, heating and energy efficiency come up frequently for older renters. One older person said that their house was “never warm… there is a smell of damp in the winter months. There is a huge opening in the back wall where the boiler is located. The wind whistles into the flat.” Another said that their home was cold “even in the summer.”
The charity said that not only are some of the conditions described by interviewees likely in violation of the Repair Standard that sets out a minimum standard that rental properties must meet, but tenants are scared to ask for necessary and reasonable repairs in case they are served with a ‘revenge eviction’. One man said: “I know if I complain to my landlord, it will get me nowhere but homeless.”
Evictions and homelessness
The report reveals that almost one in six (17%) older private renters are worried that their landlord will evict them in the next 12 months.
Almost three in five (59%) say that searching for a new home would be difficult6, likely due to older people sometimes needing special adaptations, such as a ground floor flat, and the growing unaffordability of rents.
Terrifyingly, there has been a 23% rise in the number of older people experiencing homelessness in the last year, up from 891 people in 2021/22 to 1100 in 2022/23.
Joanna Elson CBE, Chief Executive of Independent Agesaid: “For all of us, an affordable, safe and secure home is essential for our wellbeing and should be the norm. That’s why it is a catastrophe that, for many Scottish older renters on a low income, this is far from the reality.
“The Scottish Government made positive moves in recent years to protect tenants. But with many of these protections from eviction and rent increases coming to an end soon, we’ve spoken to many people renting in later life who are absolutely terrified about what will happen over the coming months.
“The Housing Bill is a once in a generation opportunity for the Scottish Government to make sure everyone has a home that is affordable, kept to a decent standard and free from the threat of eviction and homelessness.
“We hope they take action to ensure that all Scottish renters can live with dignity, no matter their age.”
Recommendations
Independent Age is calling for the Scottish Government to:
Establish a housing ombudsman to give tenants the power to challenge their landlords on poor maintenance and ensure that housing advice and advocacy services are accessible and properly funded so renters are aware of their rights.
Introduce a permanent system of rent controls so homes are affordable for older people on a low income, commit to building more social housing and increase access to, and funding of, Discretionary Housing Payments that support those on Housing Benefit who have a rent shortfall.
Ensure tenants, including those in later life on a low income, are informed of their rights.
Enshrine the right to adequate housing in Scots Law
Place a duty on local authorities to help someone threatened with homelessness in the next six months and require landlords to inform tenants of independent advice services before or when they serve them an eviction notice.
Independent Age is also calling on the UK Government to commit to uprating Local Housing Allowance every year so that Housing Benefit matches rises in local rents.
An initiative which will support low income families to take part in community action and advise on improvements in local services is being funded as part of a wider programme to help develop new approaches to child poverty.
The project, led by Midlothian Sure Start in partnership with Midlothian Council, is one of nine successful applicants to the Child Poverty Practice Accelerator Fund – which was set up to explore promising approaches or redesign services to maximise their impact on child poverty.
A Cash First Fund, which aims to reduce the need for emergency food parcels and food banks, will also fund eight partnerships to provide help to low income families. Six of these will provide new sources of cash-first support.
This morning Social Justice Secretary @S_A_Somerville announced two new funds to deliver cash first support for people in need, and develop new approaches to tackling child poverty.
Social Justice Secretary Shirley-Anne Somerville said yesterday: “These two funds exemplify the innovative approach the Scottish Government is taking to tackling poverty and delivering for the people of Scotland.
“The Midlothian partnership will give local families the opportunity to get involved in and influence local services. It will aim to identify improvements which will ensure help on offer is joined-up and people are supported in a dignified way to reduce stigma.
“Other projects will help to accelerate progress in tackling poverty, including by making it easier for people to access cash in a crisis and by connecting people with advice to prevent future hardship.
“We are investing £3 billion this financial year to tackle poverty and protect people from the cost of living crisis. We are taking all the action we can to support people within our limited powers and fixed budget.”
Cash First Fund: successful proposals
Area
Lead partner
Aberdeen
Aberdeen Voluntary Action (TSI)
Aberdeenshire
Aberdeenshire Council
Edinburgh
Edinburgh Health and Social Care Partnership
Fife
Fife Council
Glasgow
Glasgow Centre for Population Health
North Lanarkshire
North Lanarkshire Council
Orkney
Voluntary Action Orkney (TSI)
West Dunbartonshire
West Dunbartonshire Council
Child Poverty Practice Accelerator Fund: successful proposals
Area
Project
Aberdeen City
Data driven identification of households experiencing child poverty to inform and direct intervention and support.
Argyll and Bute
Evaluating the usefulness of third-party datasets for identifying communities in need of financial support.
Edinburgh
Income Maximisation Outreach
Inverclyde
Parent Centred Early and Intensive Intervention – supporting parents with children and babies under 5 years
Midlothian
Midlothian Peer Research – A Case for Change through a Place Based Approach Building Skills and Influencing
Moray
Improved identification of families affected by disability and delivery of support to maximise income
North Ayrshire
North Ayrshire Single Shared Assessment (NASSA)
Perth & Kinross
Beyond Emergency Support to Sustainable Livelihoods – Capacity Building Programme for Local Communities
South Lanarkshire
Paths out of Poverty’ – empowering parent/carers of disabled children through innovative, holistic, strengths-based approach.
Hardship deepens as millions find the poverty line further out of reach
New analysis in the Joseph Rowntree Foundation (JRF) flagship UK Poverty report quantifies for the first time how many thousands of pounds are needed by families to escape poverty – and how that has got worse over time.It is now20 years and 6 prime ministerssince there was a sustained fall in poverty.
New analysis in the Joseph Rowntree Foundation (JRF) flagship UK Poverty report quantifies for the first time how many thousands of pounds are needed by families to escape poverty – and how that has got worse over time. It is now 20 years and 6 prime ministers since there was a sustained fall in poverty.
How much you would need to move out of poverty
The poverty gap, or the amount of money needed to bring the incomes of people in poverty to the poverty line, has grown wider. Six million of the poorest people – those living in very deep poverty – would need on average to more than double their income to move out of poverty.
Analysis of the latest data shows that the average person in poverty has an income 29% below the poverty line, with the gap up from 23% in the mid-1990s. The average income of people in very deep poverty – is 59% below the poverty line.
This is equivalent to a couple with two children under 14:
in poverty needing an additional £6,200 per year to reach the poverty line. In the mid 90’s, the gap was £3,300 after adjusting for inflation.
in very deep poverty needing a whopping £12,800 more to reach the poverty line.
Poverty increased in the latest official data, returning close to pre-pandemic levels
Over one in five people in the UK (22%) were in poverty in 2021/22
This equates to 14.4 million people in total, with 8.1 million working-age adults, 4.2 million children and 2.1 million pensioners living in poverty
Nearly two-thirds (64%) of working-age adults in poverty live in working households. This has increased by 3 percentage points, from 61% to 64%, between 2020/21 and 2021/22
The number and proportion of children and pensioners in poverty rose between 2020/21 and 2021/22, as well as overall poverty
Around two in every ten adults are in poverty in the UK, with about three in every ten children being in poverty
Around 6 million people lived in very deep poverty in 2021/22
JRF analysis of broader trends since the 1970s shows that poverty rates grew rapidly under the Thatcher Government, reaching around a quarter in the mid to late 1990s, and have remained stubbornly high since then.
Poverty fell during the first half of the New Labour administration but started to rise after 2005. Overall, poverty has barely moved since Conservative-led Governments took power in 2010, with every year’s poverty rate since then being between 20% and 22%.
At the same time, the British public is more conscious of rising poverty levels in society. Since 2017, the majority agree that the government should increase tax and spending on health, education and other social benefits.
As we approach a general election, political parties must urgently address entrenched high levels of poverty by:
Introducing an ‘Essentials Guarantee’ into Universal Credit, to ensure that everyone has a protected minimum amount of support to afford essentials like food and household bills.
Beyond this, future governments must focus on expanding the foundations of economic security to everyone in our society. People experiencing poverty, especially deep poverty, will be looking for plans from parties to ensure that they are not left unprotected when times are hard.
Paul Kissack, Group Chief Executive of the Joseph Rowntree Foundation, says: “It has been almost twenty years and six Prime Ministers since the last prolonged period of falling poverty in the UK. Instead, over the last two decades, we have seen poverty deepen, with more and more families falling further and further below the poverty line.
“Little wonder that the visceral signs of hardship and destitution are all around us – from rocketing use of foodbanks to growing numbers of homeless families. This is social failure at scale. It is a story of both moral and fiscal irresponsibility – an affront to the dignity of those living in hardship, while driving up pressures on public services like the NHS.
“It’s a story which can – and must – change. Governments are not powerless to act, as we have seen throughout our history. One way politicians can take action in the next parliament is to enshrine in law a guarantee that people will always be able to afford the essentials, such as food and household bills, through our benefits system.
“2024 will be a year of choices, and any political party wishing to form a new Government must set out a practical and ambitious plan to turn back the tide on poverty in the UK. That plan – to ensure the dignity and respect of every member of our society – will be essential for achieving any broader ambitions for the country”.
Martin Lewis, Founder of MoneySavingExpert.com & The Money & Mental Health Policy Institute Charitysaid: “I warned at the start of the energy crisis that I was out of tools to help many on the lowest incomes. “
“Now we have hit the stark reality that 100,000s of people in the UK, even after they’ve had professional help from money charities, are still deficit budgeting – so their income is less than their minimum necessary expenditure.
“Definitions of poverty are tricky, especially when based on relative incomes, but that smells like a clear indication the problem is getting worse.
“And let’s be plain, once people are in the deepest mire, it’s not a Money Saving Expert you need, its policy makers and regulators to sit up take note and address these deep rooted problems – which is exactly what I hope they do with this Joseph Rowntree Foundation report highlighting the situation and calling for change.”
Number of people in poverty and poverty rates for different groups, UK, 2021/22
UK is only country in G7 where household budgets have not recovered to pre-pandemic levels
Families would be £750 a year better off if real disposable income had grown in line with other leading economies
Working people are being made poorer by Conservative failure, union body says
The UK is suffering the worst decline in living standards of any G7 country – according to new TUC analysis published this week.
The analysis shows the UK is only G7 economy where real household disposable income per head hasn’t recovered to its pre-pandemic levels:
Real household disposable incomes in the UK were 1.2% lower in the second quarter of 2023 than at the end of 2019.
But over the same period they grew by 3.5%, on average, across the G7.
The TUC estimates that if real disposable income in the UK had risen in line with the G7 average UK families would be £750 a year better off.
More pain ahead
The union body warned that the contraction in UK household budgets is going to get worse – despite falling inflation.
The Office for Budget Responsibility (OBR) forecasts that real house disposable income per head in Britain will fall by an additional 3.4% by the end of the first quarter of 2024.
And according to the same forecasts household budgets won’t even recover to their pre-pandemic levels until the end of 2026.
The OBR said in November that UK households are suffering the worst period for living standards since modern records began in the 1950s.
Households in debt
The TUC says the Conservatives’ failure to grow the economy and deliver healthy wage growth has pushed many households further into debt.
Analysis published by the union body at the end of December revealed that unsecured debt (credit cards, loans, hire purchase agreements) is set to rise by £1,400 per household, in real terms, this year.
The TUC says working people have been left brutally exposed to rising costs after years of pay stagnation.
UK workers are on course for two decades of lost living standards with real wages not forecast to recover to their 2008 level until 2028.
The TUC estimates that the average worker has lost £14,800 since 2008 as a result of their pay not keeping up with pre-global financial crisis real wage trends.
TUC General Secretary Paul Nowak said: “The UK is the only G7 nation where living standards are worse than before the pandemic.
“While families in other countries have seen their incomes recover – household budgets here continue to shrink.
“This is a damning indictment on the Conservatives’ economic record.
“Their failure to deliver decent growth and living standards over the last 13 years has left millions exposed to skyrocketing bills – and is pushing many deeper into debt.
“We can’t go on like this. Britain cannot afford the Tories for a day longer.”
Growth in real disposable household income in the G7
Country
change 2019Q4 to 2023Q2
United Kingdom
-1.2
Italy
0.1
Germany
0.2
Japan *
0.5
France
2.4
Canada
3.0
G7
3.5
United States
6.0
source: OECD; * Japan to 2022Q1
– The analysis is based on OECD figures for real household disposable income per head, which extend to 2023Q2 (except for Japan, which go to 2022Q1). Looking forward, UK figures are based on Office for Budget Responsibility projections in the November 2023 Economic and Fiscal Outlook. As with the ONS outturns and OBR projections, cash figures are in 2019 prices.
– The OBR measure living standards as real household disposable income (RDHI) per person.
‘A BUDGET OF MISSED OPPORTUNITIES ON TACKLING POVERTY AND LITTLE FOCUS ON PREVENTION’
COSLA has described the Scottish Government’s Draft Budget as a missed opportunity for the communities of Scotland in relation to tackling poverty.
COSLA also added that Scotland’s Council Leaders, Councillors, the Local Government Workforce and communities should be treated with the respect they deserve demonstrated through investment, not cuts.
COSLA said: “At a special meeting just before Christmas, there was dismay and frustration from Scotland’s Council Leaders about the way Local Government and the communities we represent had been treated in the Scottish Government’s Draft Budget. As the Budget currently stands, communities will see and feel a range of negative impacts.
“COSLA’s ‘Councils are Key’ budget lobbying campaign set out the case for fair funding that would allow Local Government to deliver for the people of Scotland, particularly around tackling poverty, one of the three shared priorities laid out in the Verity House Agreement.
“The response from the Scottish Government to our Budget ask is disappointing and will mean that the potential that councils have to prevent problems occurring will be limited severely.
“Specifically on poverty, the Budget should have had a focus on tackling the root causes of poverty, particularly its impacts on children. This would have needed a greater prioritisation of the work councils do in prevention and early support.
“The essential social supports councils provide in homes, schools, hubs and communities that aim to support and empower people will be further eroded – this has been the case for a number of years now, due to poor Local Government settlements that cut core funding.
“Services that support Local Government to Keep the Promise made to Scotland’s care experienced children and young people like family support and youth work, are under threat as a result of the proposed Scottish budget.
“Tackling poverty in Scotland will continue to be a significant challenge when councils do not have the resources they need to support communities.
“This year’s Budget presented the opportunity prioritise prevention and tackle inequity, to invest in communities and realise our ambitions to end poverty in Scotland.
“It did not deliver. Without a fair settlement for Councils, the poverty gap in Scotland will continue to grow. Investing in Local Government is key to a fairer Scotland.”
“The proposed Council Tax Freeze means that money which could have been invested in tackling poverty upstream – in families, communities and schools – is lost, missing a real opportunity to unlock Councils’ potential.
“COSLA’s President, Vice President and political Group Leaders from all parties have written to the Deputy First Minister and are seeking an urgent meeting.
“Council Leaders will not let this lie, they simply cannot afford to because it will have such a detrimental impact on the communities they represent.”
