Millions would need to DOUBLE their incomes to escape poverty, warns charity – as Martin Lewis urges policymakers to act
Millions of people would have to double their incomes to escape poverty, according to a new report from charity the Joseph Rowntree Foundation (JRF). MoneySavingExpert.com founder Martin Lewis says the problem seems to be getting worse, and has joined the charity in urging policymakers to act.
The charity's analysis of the latest official data on poverty rates found that a couple with two children under 14 in what's considered to be "very deep poverty" would need an additional £12,800 a year – more than double their household income – just to get out of poverty. See below for more key findings from the report.
Martin Lewis: 'Policymakers and regulators need to sit up and take note to address these deep-rooted problems'
Commenting on the report, Martin Lewis – founder of MoneySavingExpert.com and the Money and Mental Health Policy Institute charity – said: "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, it's policymakers 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."
In its flagship 'UK Poverty Report', the JRF examined the scale of poverty across the country and, for the first time, sets out how much extra income families would need to escape poverty.
The report found that, in 2021/22 (when the latest official poverty data was collected):
- More than one in five people in the UK – 14.4 million – were in poverty. The charity defines this as having a household income of less than 60% of the UK average for the type of household you're in (after adjusting for housing costs).
Of the total number of people in poverty, working-age adults made up over half (56%), children made up 29% and pensioners made up the remaining 15%.
- Four out of ten people below the poverty line were in "very deep" poverty. This is defined as having a household income of less than 40% of the UK average. The number of people in this category has increased by 1.5 million over the past two decades, and now stands at six million in total.
- A couple with two children under 14 in very deep poverty would need an additional £12,800 a year to get out of it. A couple with no children would need £9,200 a year, while a single adult with no children would need £5,300.
As a result of these findings, the JRF is calling on all political parties to commit to introducing an "Essentials Guarantee" into Universal Credit to ensure that the basic rate will always cover essentials, such as food and energy. Last February, the charity found that 90% of people on Universal Credit were going without essentials. See our Universal Credit guide for more info on who can get it, how much you can get and how to apply.
For the charity's full findings and recommendations, read the full report.