• Social Metrics Commission welcomes Government’s decision to start the process of adopting new official poverty measure.
  • The measure was developed by the Commission and launched in September 2018, after three years of development.
  • The Commission unites thinkers from the left and right with poverty and data experts.

The Government has today announced that it will begin the process of developing an experimental statistic based on the measure of poverty developed by the Social Metrics Commission. This is the process that all statistics need to go through before they become official national statistics.

The need for this is clear, as there is significant debate about how poverty can be measured. As such, the SMC’s mission has been to provide a new consensus around poverty measurement that enables action, informs policy making and so seeks to improve the lives of people in poverty.

After three years of research, development and engagement with a wide range of stakeholders, the Commission launched is proposal for a new poverty measure in September 2018. For the first time, as well as looking at incomes, the new metric:

  • Accounts for a range of inescapable costs that reduce people’s spending power, and the positive impact of people’s liquid assets on alleviating immediate poverty. These inescapable costs include rent or mortgage payments, childcare and the extra costs of disability. Liquid assets include savings, stocks and shares; and
  • Tells us more about the experience of people living in poverty, by including measures of poverty depth, poverty persistence and a range of Lived Experience Indicators, which capture the resilience gap of people living in poverty.

The Commission now looks forward to working with the DWP and other stakeholders to take forward development of the experimental statistics. While they are in development, the Commission will also continue to publish information on poverty and the experience of poverty; including updates of its first report, due to be published over the summer.

Commenting on Government’s announcement, Philippa Stroud, Chair of SMC and CEO of Legatum Institute said:

I am delighted that the Government is 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.

For too long, poverty measurement has been treated like a political football. This has allowed political and policy debate on poverty to focus on whether and how we should measure poverty, rather than the action needed to drive better outcomes for the most disadvantaged in our society.

The Social Metrics Commission has worked hard over the last three years to build a broad coalition of support and develop metrics that we believe represent a significant step forward in our ability to measure and understand poverty in the UK.

We now look forward to working with DWP as it takes this process forward, in order to ensure that the UK has a new measure of poverty that better reflects the lives and experiences of families struggling to make ends meet, and that can be used to improve policy making.

MEDIA CONTACTS

Jo Nussbaum

0207 148 5432 or
07407 810796 (out of hours)

 

NOTES TO EDITORS

The SMC’s first report, available at socialmetricscommission.org.uk, reveals numerous key findings and challenges. The total number of people living in poverty is 14.2 million with the composition of poverty moving towards a better identification of children (4.5 million) and working-age adults (8.4 million). The good news is the shift away from pensioner poverty with far fewer pensioners living in poverty following a significant reduction of poverty amongst pension age couples, over the last 15 years.

The report reveals that people with a disability are much more likely to be living in poverty than previously thought, with around half of the 14.2 million people in poverty living in families with a disabled person.

The report also reveals the persistence and depth of UK poverty. More than one in ten (12.1%) of the total UK population are in poverty now and have been in poverty for at least two of the previous three years. A further 2.5 million people live less than 10% above the poverty line and are close to falling below it with relatively small changes to their circumstances; and around 2.7 million people live less than 10% below it.

SMC KEY FINDINGS

  1. Two million people in the UK population live in poverty: 8.4 million working-age adults; 4.5 million children; and 1.4 million pension age adults.
  2. Over half of those in poverty (58.2%) also live in persistent poverty. This means that more than one in ten (7.7 million) of the total UK population are in poverty now and have been in poverty for at least two of the previous three years. Persistent poverty is highest in families more than 10% below the poverty line, in workless families and families where someone is disabled.
  3. People with a disability are much more likely to be living in poverty. Nearly half of the 14.2 million people in poverty live in families with a disabled person (6.9 million people equal to 48.3% of those in poverty). The SMC metric recognises the inescapable costs of disability, accounting for them alongside the value of disability benefits, to reflect the lived experience of living with a disability.
  4. Far fewer pensioners are living in poverty than previously thought, with a significant fall in pensioner poverty over the last 15 years. Poverty rates amongst pension-age adults have nearly halved since 2001, and have fallen to one in ten, a drop from 17% of the total population in poverty in 2001 to 11% in 2017. There are, however some pensioner groups still experiencing high levels of poverty. For example, the poverty rate for pensioners who do not own their own home is 34.2%.

About the Social Metrics Commission

The Social Metrics Commission is an independent Commission formed and led by the Legatum Institute’s CEO Baroness Stroud.

It is an independent and rigorously non-partisan organisation dedicated to helping policy makers and the public understand and act to tackle poverty. Its goal has been to develop new poverty metrics for the UK which will have both long-term political support and effectively identify those who are in poverty. By doing so, we hope that Government and others will be better able to develop interventions that reduce the number of people experiencing poverty and improve outcomes for those people who do experience it.

The Legatum Institute hosts the Commission and is the lead sponsor. This work of the Commission would not have been possible without that support, and the research, editorial and functional independence that has underpinned the Commission’s work. The Commission has also been generously supported by the Joseph Rowntree Foundation, Calouste Gulbenkian Foundation (UK Branch), Garfield Weston Trust, PF Charitable Trust and Mr Sanjit and Mrs Sangeeta Talukdar. Oliver Wyman have also provided significant pro-bono technical support to the Commission, which was essential in providing a rigorous approach to the data.