New evidence published today, the first day of Challenge Poverty Week, shows the cost of housing has been the main reason behind lower levels of poverty in Scotland than in the rest of the UK. But without a long-term focus on boosting supply and affordability, this success is at risk of unravelling.
The assessment comes in an annual state of the nation report by the independent Joseph Rowntree Foundation, the leading authority on poverty in the UK. Poverty in Scotland 2019 examines how poverty has changed over the 20 years of devolution and explains why the new Scottish Child Payment alone will not be enough for the Scottish Government to reach its statutory target of reducing child poverty to 10% by 2030.
According to the latest official figures, just over 1 million people in Scotland are locked in poverty, including 240,000 children, 640,000 working-age adults and 150,000 pensioners.
Although poverty rates before housing costs are very similar across the UK, after housing costs are taken into account, poverty is significantly lower in Scotland.
The latest data shows that 20% of Scots are in poverty after housing costs compared with 22% in the rest of the UK. This difference is biggest for children whose poverty rate currently stands at 24% in Scotland compared with 30% in the rest of the UK.
The divergence in poverty levels is mainly driven by the lower cost of housing in Scotland, particularly within the social rented sector. In 2017, social rents were 14% lower for housing association tenants and 18% lower for council tenants in Scotland when compared with England.
Jim McCormick, associate director (Scotland) at the Joseph Rowntree Foundation, said:
“As a country we have rightly made a bold commitment to loosen the grip of poverty on children across Scotland. Over the last two decades, cheaper rents and a larger social rented sector in Scotland have been key to unlocking opportunities for families to achieve a decent life. But this success is showing signs of unravelling and cannot be taken for granted.
“The recent announcement of the Scottish Child Payment shows what can be achieved when we are bolder in our thinking and accept that only large-scale action will ease the pressure facing families trapped in poverty. While this new payment will start to turn the tide, it will not by itself be enough to enable every child to break free from poverty.
“As we mark Challenge Poverty Week, it is vital that ministers in Holyrood match their ambitious targets to solve poverty with the scale of action on housing, work and social security needed to make this a reality.”
The lower levels of poverty after housing costs are also explained by a higher proportion of people living in the social rented sector and a growing proportion of people owning their own homes.
However, over the last five years, there are signs that this relative advantage is beginning to unravel with social rents rising faster in Scotland than in England.
Overall poverty rates in Scotland are almost 4 percentage points lower in the three years from 2015 to 2018 than they were in the early years of devolution from 1999-2002. However, since the start of this decade, progress has been unravelling with children, parents and pensioners all seeing their risk of being trapped in poverty rising again.
The Resolution Foundation recently projected that child poverty is set to rise to 29% in 2023/24, which is mainly being caused by UK Government reforms to social security. JRF is urging government, employers, housing providers and communities to work together to find practical solutions to the issues holding people back.
The Scottish Government must use the full extent of its devolved powers to bring forward new game-changing policies across housing, work and social security if it is to stand any chance of reaching its interim target of reducing child poverty to 18% in 2023/24.
The current programme of housing policy is due to end in 2021. The Scottish Government must commit to maintaining at least its current level of investment in boosting the supply and affordability of social homes. This will be key to ensuring housing continues to play its long-term role in solving poverty in Scotland