This document discusses the rise in poverty and inequality in the UK. It provides statistics showing that the percentage of households who cannot afford adequate housing, heating, or basic necessities has increased significantly from 1983 to 2012. Children from deprived households are more likely to have health problems. More people are experiencing stress and mental health issues due to financial problems. While pensioner poverty has decreased, in-work poverty has sharply risen. The document suggests that rising inequality has negatively impacted economic growth. It discusses potential policy solutions like increasing social spending, making tax systems more progressive, boosting wages for low-income workers, and strengthening social protections.

1. Edinburgh Book Festival, 18th August 2015

2. The rise in food poverty
I only tend to eat one meal a day and that does me,
cos I like to make sure I got for my children.
Jennie, single parent
In 2012, 28% of adults skimped on meals during the year because of
lack of money.
In 1983, 13% did so.

3. 0%
2%
4%
6%
8%
10%
12%
Can't afford adequate heating in home Live in a damp home
Percentage of households
1983 1990 1999 2012
The return of poor housing

4. Poor housing, poor health
Children experiencing housing deprivation are 25% more likely
to be seriously ill by the age of 33
No one sleeps in the back room because of the damp.
If we did sleep in there we’d get sick.
Tyrone, aged 8

5. Necessities: the public’s view

6. Rising absolute deprivation
Percentage who cannot afford items from the 1999 list of necessities in 2012 and 1999
0%
10%
20%
30%
40%
50%
60%
1+ 2+ 3+ 4+ 5+ 6+ 7+ 8+ 9+ 10+ 11+ 12+ 13+ 14+ 15+
percentage of adults
1999 2012
2012
1999

7. 0%
5%
10%
15%
20%
25%
30%
35%
1983 1990 1999 2012
Percentage of households who cannot afford 3 or more necessities
Rising deprivation poverty

8. The impact on well-being
• 73% of those in deprivation poverty have financial problems
• 28% of adults experiencing stress, strain and poor mental
health up from 18% in 1999
It’s just in your head ‘cos you have to constantly think about money.
Last year I had a mental breakdown ‘cos I couldn’t hack it.
Marc, young job seeker

9. The winners and losers
The changing face of poverty
Fall in pensioner poverty
Sharp rise in in-work poverty

10. Why the rise?

11. Britain’s growing divide
Share of net income top 1% up from 6% to 13%
Share of net income of top fifth up from 35% to 42%
Share of net income of bottom fifth down from 10% to 8%
From 1979 to 2011

12. The falling wage share
50
52
54
56
58
60
62
64
66
1948 1953 1958 1963 1968 1973 1978 1983 1988 1993 1998 2003 2008
1948-2011, UK

13. ‘A dangerous gap between profits and people’
Guy Ryder, Director-General, the ILO

14. Low paid Britain
4
8
8
8.5
11.1
12.5
13.5
13.6
14.2
14.4
14.7
15.7
16
17.6
20.2
20.2
20.5
20.6
24.8
0 5 10 15 20 25 30
Belgium
Norway
Italy
Finland
France
New Zealand
Greece
Denmark
Portugal
Australia
Japan
Spain
Austria
Netherlands
Ireland
Germany
Canada
UK
USA
Percentage of employees
Share of employees in low-wage work, 2011

16. Effect of inequality on the economy
‘Lower net inequality is robustly correlated with
faster and more durable growth’
IMF
‘In Italy, the UK and the US, the cumulative growth
rate would have been six to nine percentage points
higher had income disparities not widened.’
OECD

17. ‘Inequality is the defining challenge of our time.’
President Obama, 2012
‘Excessive inequality is corrosive to growth; it is corrosive to
society… the economics profession and the policy community
have downplayed inequality for too long.’
Christine Lagarde, IMF, 2013
‘Inequality is the biggest danger facing the globe.’
World Economic Forum, 2013
The verbal war on inequality

18. The rising profit share and falling
investment, 1948-2010

19. Top executive v employee pay,
2000-13
100
150
200
250
300
350
2000 2002 2004 2006 2008 2010
Top Executives, FTSE 100
All-full time employees
Index: 2000 = 100

20. ‘With unchanged policies, the average OECD country
will face an increase in (pre-tax) earnings inequality by
30% in 2060, facing almost the same level of inequality
as is seen in the US today.’
OECD, Shifting gear, policy challenges for the next fifty
years, 2014
Growing inequality

21. Demonising the poor
Tabloid headlines – 2010 to 2014

22. Weakened social protection
• £32 billion cut from working age benefits
by 2020
• Much tougher sanctions
• Abolition of Child Poverty Act

23. Written out of the script

24. What can be done:
Increase social spending
Higher social spending = lower rates of poverty

25. What can be done:
Reclaim universalism
• Increase child benefit
• Increase sickness and disability benefit
• Consider a citizen’s income

26. What can be done:
Shift the tax take
• Clamp down on tax avoidance
• Make income tax more progressive
• Introduce wealth and property taxes

27. What can be done:
Boost wages in the bottom half
• Substantial increase in the minimum wage
• Restore collective bargaining
• Raise public and private investment

28. That’s my dream
Seeing my children have a stable place, proper food, good clothes.
You know, a better life. I would want better for them.
Jennie, single parent
www.poverty.ac.uk