Yahoo Finance Government will publish new poverty statistics starting in 2020
The UK will start publishing experimental statistics on poverty in 2020, following demands that the government replace the previous official measure that was abolished in 2015.
The new statistics will use a methodology developed by the independent Social Metrics Commission — which creates a poverty line relative to what the average family has to spend — as a starting point.
In addition to taking into account the negative impact of things like childcare costs and disability, the new metric also considers the positive impacts of being able to tap into liquid assets like savings that help alleviate immediate poverty.
It also includes groups of people previously omitted from poverty statistics, such as those living on the street, and those who live in overcrowded housing, but are just above the low-income threshold.
More than 14 million people were in poverty in the UK in 2016-17, according to the metric, including 4.5 million children and 8.4 million working-age adults.
Although these figures are similar to those produced by other relative poverty measures, around half a million fewer pensioners are defined as living in poverty.
The move is thus expected to precipitate a longer-term shift in welfare policy and public spending priorities, with younger families standing to gain.
Welcoming the announcement, Social Metrics Commission chair Philippa Stroud said the move indicated that the government was “taking poverty measurement seriously.”
“Without effective measures of poverty, we cannot hope to reduce the number of people who experience it or improve the lives of people who live in poverty,” Stroud said.
The previous measure defined someone as living in poverty if they lived in a household with income 60% below the median level.
It was abolished by then-prime minister David Cameron in 2015, when his government’s spending cuts were widely considered to be increasing poverty levels.
The new measure’s poverty threshold is 55% of the total resources available to the median family. It aims to reflect the extent to which people have the resources “to engage adequately in a life regarded as the norm in society.”
The Department of Work and Pensions will assess whether this measure can be developed and improved further “to increase the value of these statistics to the public.”
In a statement announcing the change, family support minister Will Quince said that the government recognised that “some families need more support,” even though employment was “at record levels and income inequality and absolute poverty are still lower than in 2010.”
