More than 7 million people in the UK are living in poverty despite being part of a working family, according to a study which uncovers how deprivation is increasingly linked to the high cost and insecurity of private rented accommodation.

The report, commissioned by the Joseph Rowntree Foundation (JRF) also found that disability is increasingly linked to the changing nature of poverty. If the costs of disability are taken into account, half of those in poverty are either disabled or living with a disabled person.

Overall poverty levels have remained flat since 2010, in part because of a general economic recovery, according to the study carried out by the New Policy Institute, which researches issues connected to poverty and housing.

However, it warns that much of this is down to steady economic growth. The JRF is urging the government to carefully monitor changes in poverty amid the repercussions of Brexit.

There were 13.5 million people living in households classified as poor in 2014-15, defined as below 60% of the median once housing costs are deducted. This is 21% of the UK population, a proportion barely changed in more than a decade.

However, the report found, 55% of those in poverty are now in working households, a record high. This comprises a total of 7.4 million people – 1.1 million more than in 2010-11 – among them 2.6 million children.

In contrast, there are 400,000 fewer pensioners in poverty from a decade ago, despite there being 1.7 million more people in that age bracket, the study, Monitoring Poverty and Social Exclusion 2016, reported.

A significant factor in these shifts, the study said, was the increased number of people living in expensive and insecure private rental properties, with the number of people in poverty in private lets doubling in a decade to 4.5 million.



“Failures in the housing market are a significant driver of poverty,” the study said. “This is primarily, but not entirely, due to costs.”

The number of all rental eviction has risen by 60% over five years to 37,000 annually, it said, with a particularly steep recent rise in private evictions. Over the same period mortgage repossessions have fallen from 23,000 to 3,300.

Among those in the bottom 20% of the income bracket who live in private rented homes, 73% pay more than a third of their income in rent, the report said, compared with 50% of social renters and 28% of owner occupiers who do so.



The number of private renters living in poverty has doubled over the past decade, the data showed, meaning there are now as many private renters in poverty as social renters.

Cuts to benefits were also identified as a factor in poverty. “Increasingly, the social security system does not cover the full cost of essentials for those on low incomes, such as rent and council tax,” the report said.

This was likely to get worse with the reduction in the overall benefit cap, the authors said, with 112,000 families expected to experience a reduction in income because of the cap, up from the current 20,000.

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The report also found significant regional differences, with high rental costs seemingly playing a role in this. London and south-east England, where housing costs have risen in recent years, has the highest poverty rate at 27%, 6% above the UK average.

Any overall increase in poverty levels has been held off in part by record employment levels, the report noted, with the figure of 1.4 million children living in workless households being the lowest recorded.

But much more needed to be done, said Helen Barnard, the head of analysis at the JRF. “The UK economy is not working for low-income families,” she said. “The economy has been growing since 2010 but during this time high rents, low wages and cuts to working-age benefits mean that many families, including working households, have actually seen their risk of poverty grow.

“As it negotiates Brexit, it is vital that the government does not allow its focus to slip from the domestic concerns that make a huge difference to people who are just about managing. This report shows that people on low incomes cannot rely on economic growth and rising employment alone to improve their financial prospects.”

A spokeswoman for the Department for Work and Pensions said: “Since 2010, the number of people living in poverty has fallen by 300,000, but we know there’s more to do. We’re increasing the national living wage and taking millions of people out of income tax, to make sure it always pays to be in work.”

However, Debbie Abrahams, the shadow work and pensions secretary, said the report showed “the true impact of six wasted years of Tory austerity, with 7.4 million people in poverty in working households”.

She added: “This government has no plan to tackle stagnant wages and rising insecurity, choosing instead to make the poorest pay for their economic mismanagement.”