Tag Archives: Poverty

Working families fall short of minimum living standard

The overall cost of a child over 18 years (including rent and childcare) is £150,753 for a couple and £183,335 for a lone parent. But work doesn’t pay low-income families enough to meet a no-frills standard of living, new research from Child Poverty Action Group (CPAG) shows.

Cost of a Child ReportA combination of rising prices, benefits and tax credits freezes, the introduction of the benefit cap and two-child limit, the bedroom tax, cuts to housing benefits and the rolling out of Universal Credit have hit family budgets hard.

Life has been getting progressively tougher for families on low or modest incomes over the past ten years, with families on in-work and out-of-work benefits hardest hit, the report warns.

Despite the introduction of the ‘national living wage’, low-paid families working full-time are still unable to earn enough to meet their families’ needs. The gains from modest increases in wages have been clawed back through the freezing of tax credits.

Even families with two parents currently working full time on the ‘national living wage’ are 11% (£49 per week) short of the income the public defines as an acceptable, no-frills living standard.

The cumulative effect of cuts, frozen benefits and new punitive measures hit lone parents particularly hard. For lone parents, even a reasonably paid job (on median earnings) will leave them 15% (£56 per week) short of an adequate income because of the high cost of childcare. A lone parent working full-time on the ‘national living wage’ will be 20% (£74 per week) short of what they need to achieve a minimum standard of living. However, a lone parent relying solely on benefits will go without 40% of the budget they need for a socially acceptable minimum.

With the introduction of the two-child limit, families with three or more children fare worst – a third child born after 1 April 2017, for whom no additional support will be provided, costs around £86,500 or £4,800 a year excluding childcare.

Larger families on out-of-work benefits who avoid being hit by the two-child limit will instead be hit by the benefit cap which restricts support to £23,000 in London and £20,000 outside London regardless of family size. The impact of the benefit cap means that an out-of-work family with three children living in a privately rented home will receive just a little over a third of what they need to meet their needs, with a shortfall of around £400 per week.

The costs of a child are calculated according to a minimum standard of income that covers the costs of essentials such as food, clothes and shelter as well as other costs necessary to participate in society. It looks at the needs of different family types and is informed by what ordinary members of the public feel is necessary for both couples and lone parents bringing up children.

Chief Executive of Child Poverty Action Group Alison Garnham said: “Today, the majority of children growing up in poverty have working parents. While the number of parents in work is increasing, income from work alone is not sufficient to enable some to meet their families’ needs or escape poverty and the cost of a child is substantial. There is strong public support for government topping-up the wages of low-paid parents and investing in children is the best long-term investment we can make. By using the forthcoming budget to unfreeze benefits and restore work allowances, the government can take steps towards making work really pay.”

Click here to read the report.

Credit unions can help solve poverty

A major new report on tackling poverty in the UK has highlighted the role that credit unions can play.

We Can Solve Poverty in the UK Report

The report, We can solve poverty in the UK, from research charity the Joseph Rowntree Foundation (JRF) offers a plan to end poverty in this country by 2030. It is the most comprehensive strategy of its kind to set out how to solve poverty across all groups in the UK, calling for a new ‘long term deal’ to solve poverty between governments, business and the public.

A role for credit unions is identified in providing fair and affordable access to credit, as well as in helping people to save, budget and avoid problem debt.

The strategy encourages employers to provide – and promote the take-up of – credit union membership as a staff benefit to promote saving and access to affordable credit, highlighting the ease with which employees can save and repay loans direct from payroll. It also calls for the expansion of credit unions’ capacity to provide affordable credit through support from employers, local government and social investors.

The report recommends that tackling poverty should be an explicit aim in social landlords’ business plans and strategies, arguing that: “Housing associations could play a role in delivering affordable credit to their tenants, as part of a wider financial inclusion strategy, working with credit unions where possible.”

Launching the strategy, JRF Chief Executive Julia Unwin said: “Poverty divides communities and generations; it harms people’s potential and strains families; it drains the public purse and holds back our economy. The Prime Minister has made a promise to make Britain work for everyone and reform capitalism. As Westminster reconvenes this week, I urge her to deliver on this promise.”

To mark the launch of this significant strategy, JRF has teamed up with Big Society Capital to work towards raising up to £20m of social investment to tackle the ‘poverty premium’, whereby people on low incomes pay more for goods and services including credit and financial products. The initiative will support charities and social enterprises to develop solutions.

Mark Lyonette, Chief Executive of the Association of British Credit Unions Limited (ABCUL), said: “We welcome the JRF’s recognition of the role credit unions play in helping alleviate hardship and poverty. Credit unions are proud to serve people from all walks of life, which includes those who may struggle to access credit and financial services from other providers. The expansion and modernisation of Britain’s credit union movement will make us even better equipped to provide services to people right across our communities.”

 

Baaah! Humbug! When Christmas gets your goat, put some ‘music’ on!

ActionAid Goats AlbumAn entire album of Christmas songs sung by GOATS is going viral, as people around the world download their favourite classics sung with a twist.  

‘All I want for Christmas is a Goat’ is a new album developed by ActionAid in Sweden and consists of eight festive anthems including Jingle Bells, Silent Night and White Christmas.

Free to download on Spotify and YouTube, the album has hit headlines globally and hopes to do the same in the UK in the lead up to the battle for Christmas number one.

So far, the most played goat anthem is well-known Christmas favourite Holy Night, with over 300,000 views on YouTube alone. ActionAid is “baah-cking” the single for Christmas Number One, but the big question is, can it “bleat” the X Factor?

Jessica Holland, ActionAid’s Head of Brand, Marketing and PR, says: “If you’re going to listen to one Christmas album this year – this is it. We’ve worked with the top “goat talent” from Sweden to take on some of the most iconic Christmas songs.

“This is the Christmas album with a difference. Behind the bleats, baaahs and goat cries we are raising awareness of ActionAid’s work fighting poverty worldwide and the positive impact that goats can have on the lives of some of the world’s poorest families.

“For women and children living in poverty, every day is a constant struggle for survival. ActionAid provides hands-on, lasting solutions to help change lives for good.

“Our Gifts in Action scheme could provide a goat to women in some of the poorest communities in the world. Their milk helps nourish that family and the remainder is sold. When kids are born, some are kept to grow the herd. Others are sold so the family can buy tools and seeds. This is a charity gift that keeps on giving.”

Learn more about ActionAid’s Gifts in Action here and listen to the entire album on YouTube.