Increasing numbers of people on low incomes is bad for health. Politicians and employers need to act immediately to improve living standards in the UK.
Lately Kids Company, a charity that supports deprived inner city children in London and Bristol, published a report highlighting the depressing reality that of the vulnerable children they see, 83 per cent rely on Kids Company for their main meal, and 64 per cent have no food at home.
One child told the researchers:
“I don’t really eat at home. We don’t have a lot to go around. If we don’t get dinner at Kids Company then we don’t really get a dinner.”
A record five million workers are now in low-paid jobs, according to Low Pay Britian 2014, a new report from the Resolution Foundation, whose chief economist said:
“While recent months have brought much welcome news on the number of people moving into employment, the squeeze on real earnings continues. While low pay is likely to be better than no pay at all, it’s troubling that the number of low-paid workers across Britain reached a record high last year.”
As we set out in the Marmot review, we all need to have enough money to live a healthy life – to be able to buy a nutritious diet, to afford to heat your house, have adequate clothing, to buy birthday cards and to interact with society.
But far too many of us are falling short. Nearly one in four UK households (23 per cent) had insufficient income to lead an acceptable standard of living, in 2011/12, according to our indicators.
That’s an increase in numbers by a fifth since 2008/9.
And that’s not all. An astonishing 913,138 people received three days’ emergency food from Trussell Trust foodbanks in 2013-14. The previous year it was 346,992 people.
This is of great concern to us at the Institute for Health Equity and is bad news for health and efforts to reduce health inequalities.
We are concerned to hear of policies that will cap the income growth of the low paid, through wages or benefits, caps that will not be offset by income tax reductions given that many pay very little or no tax already.
Without significant reductions in the cost of living, such policies will push more people into absolute poverty.
There will be impacts on children’s development, and on physical and mental health.
There appears to be a mismatch between policy and reality and we are concerned that there seems to be little in the news about the importance of absolute poverty.
A key point, which is particularly relevant now, and which could be causing unhelpful confusion, is the important distinction between absolute and relativepoverty.
The official relative poverty figures, which look at the numbers of people whose income is below 60 per cent of median income before housing costs are coming down, and after housing costs they are stable. Good news? Sadly not. The reason those numbers are flat or falling is that the median income is falling. And that is bad news.
Projections by the Institute for Fiscal Studies suggest that real median household income in 2013–14 is more than 6 per cent below its pre-crisis peak, driven largely by declines in real earnings.
Relative poverty is down, but absolute poverty, the numbers of people struggling to buy essentials, is up.
Another key point is that just over half of those who have insufficient income to afford an acceptable standard of living are actually in work.
Policies to cap public sector wage growth could push more into poverty, given that inflation is higher than the wage increases allowed. This will have a knock on impact on people on benefits, because, the government says that benefits shouldn’t rise faster than wages.
Given that wages are insufficient to raise people out of poverty, benefit levels will certainly not be sufficient. The evidence points to an urgent need to increase wages for the low paid.
As the child told the Kids Company researchers: “I like to have a banana or something, but if you were me you wouldn’t really call that a proper dinner.”