Nearly a quarter of all UK citizens were at risk of poverty or social exclusion, according to a survey by the ONS, released this week. This is equivalent to 14 million people and places the UK midway down the EU poverty league table, with Bulgaria, Latvia and Lithuania worst performers, with nearly half their populations at risk. The three best performing countries were the Czech Republic, Netherlands and Sweden, with just 15% at risk.
Looking at poverty alone, 16.2% were at risk in the UK in 2011, down from 18.7% in 2008. This is equivalent to the EU average for poverty risk. However, some caution must be taken with interpreting the poverty statistic as part of the fall is due to how the poverty line is constructed, meaning that as national income fell during the recessionary years, so did the poverty line, so somewhat perversely, the recession reduced relative poverty by causing a lowering of the threshold and pushing a few out of relative poverty! According to official measures, an individual is at risk of poverty if their disposable income (after income support, child benefits, and non-contributory pensions are included) is below 60 per cent of national median disposable income. Hence, between 2008 and 2011, median income fell from £15,068 to £14,873, which pushed the poverty line threshold down by £117 in real terms.
However, set against this is that the percentage of those claiming to be unable to meet unexpected financial expenses increased considerably since the start of the economic downturn, up from 26.6% in 2007 to 36.6% in 2011. The proportion of people unable to afford an annual holiday has also increased from 21.4% to 29.7% over this period.