Official poverty rate jumps by biggest leap since 1988

Falling incomes, austerity and Brexit have caused the biggest rise in UK poverty since the Thatcher years, according to new analysis from the Resolution Foundation.

The think tank’s annual Living Standards Audit found that real incomes for the poorest third of households fell by between £50 and £150 last year.

Brexit-related inflation increased by more than 3 per cent in 2017/18, even as the Tories inflicted further cuts to benefits and tax credits.

The research found that the combination of all these factors led to the official poverty rate jumping from 22.1 per cent to 23.2 last year – the biggest rise since 1988.

The poverty rate is made up of households living on less than 60 per cent of the median national income after housing costs are accounted for.

Child poverty

Shockingly, the Resolution Foundation found that the child poverty rate had jumped even higher – from 30.3 per cent to 33.4 per cent – and was rising at double the rate indicated by official data.

The report stated, “With the middle pulling away from the bottom, child poverty is projected to have increased last year by around three per cent.

“This was driven by benefit cuts that particularly hit low-income families, including the three per cent real-terms fall in the value of tax credits and child benefit.”

A Resolution Foundation spokesman described 2017/18 as a “strikingly bad year for lower income households”, explaining that the “2015 package of benefit cuts began in earnest, in combination with higher inflation”.

Unite assistant general secretary Steve Turner said poverty can be tackled if root causes like persistently low pay are attacked through measures such as hiking the minimum wage to £10 per hour.

Turner added, “Other measures such as properly funding social care; creating a benefits system that is fair and humane; and the return of sector level collective bargaining which will ensure that work actually does pay, can also play a major role in the fight against poverty – all it takes is the political will.

“It’s been said that a nation’s greatness can be measured by how it treats its weakest members – if this is true then we as a nation under this Tory government are failing badly.”