Report
Social security
A Minimum Income Standard for the United Kingdom in 2019
Our annual Minimum Income Standard (MIS) for the UK shows that after a decade of austerity, many households with low incomes both in and out of work are being held back from reaching MIS.
MIS is based on what the public think we all need for a decent minimum living standard. This year’s update shows that:
- Even if people work full time on wages that have been improved in the past four years, they may still be being held back from what they need.
- One reason so many families are falling further behind is because of rising costs.
- The key problem is not rising costs but the failure of incomes to keep up with these costs. On their own, higher minimum wages are not systematically bringing families closer to MIS, even if they work full time. This is because real-terms cuts in in-work benefits are holding people back.
Recommended actions
Two urgent changes can unlock families being held back from reaching a minimum acceptable standard of living:
- Uprating and restoring the value of benefits, particularly for families with children, should be a key priority. Start by uprating benefits at least by inflation after the freeze ends next year. Then start to improve benefit levels, in and out of work, with the long-term aim that at least families working full time on the National Living Wage would reach MIS.
- Ensure that Universal Credit (UC) supports childcare at the prices actually being charged. Average full-time nursery fees are now around £240 a week, and increasing the limit to at least this amount per child would help realise the benefits of the higher rate of reimbursement (85%) under UC rather than 70% under tax credits.
Use our updated Minimum Income Calculator to work out whether you earn enough for a decent standard of living.