The period since the recession has been tough for those on the lowest incomes, and new research finds poverty has not only increased but also deepened in the last couple of years.
We’re into the final week of the election campaign and a lot is at stake, says Julia Unwin.
The period since the recession has been tough for those on the lowest incomes, and new research by the New Policy Institute finds poverty has not only increased but also deepened in the last couple of years. If we don’t act now, research by the Institute for Fiscal Studies projects poverty will increase, with almost one in four working-age adults experiencing poverty by 2020. Worryingly, the assumptions that underpin these projections do not incorporate further deficit-reduction measures through tax and benefit changes in the next parliament.
If further deficit reduction does not protect the incomes of the poorest, and the economy continues to produce a large proportion of low-paid, insecure jobs that trap people in poverty rather than acting as a spring board, levels of poverty may increase further in the next parliament.
This is one of the most worrying and challenging trends to confront us as a country. Poverty wastes people’s potential, reducing the pool of talented and productive workers available to businesses. Poverty is also costly: child poverty alone costs £29 billion year through a combination of additional strain on public services, increased benefit payments and lost earnings resulting in lost tax revenue. This is money that could be more productively spent on updating infrastructure and skills to boost not just economic growth but productivity and investment, to bring benefit to all.
In short poverty is costly, wasteful and risky. But will this warning be heeded by those that form the next government?
Sadly, those on the lowest incomes are less likely to vote in this election. Occasionally during the election those struggling to make ends meet, the experience of people in insecure and exploitative work, and the increase in food bank use have all emerged as themes. But there is no sense that these issues have high priority, compared to, say the triple lock on the pension – an expensive (albeit effective) policy for a group in the population that is far more likely to vote.
However, the need for differentiation during the campaign masks the fact that there is common ground between the parties in particular areas: all agree that work should pay; that we need more affordable homes; as well as a better welfare system. We hope this can be built upon after 7 May.
It seems likely that not one party will have enough seats to form a majority and will have to rely on winning support from other parties to govern. This could create an opportunity for a shared approach to tackling the high levels of poverty in this country. But this depends on all parties acknowledging the waste, costs and risks of poverty, and acting on the need to take a comprehensive approach to sustainably reduce poverty in the UK.