“Standstill generation”

Nearly 400,000 more children and 300,000 more pensioners are now living in poverty than five years ago. 

The report, by the independent Joseph Rowntree Foundation(JRF), shows that a total of 14 million people in the UK currently live in poverty – more than one in five of the population.

The report warns that the squeeze on living standards now risks storing up problems for the future, with people being caught in a “standstill generation” – unable to build the foundations for a decent, secure life.

The report shows that people on low incomes are increasingly struggling to afford a home, with almost half on the lowest incomes – 3.2 million working-age people – now spending more than a third of their income on housing. Falling homeownership also means more elderly people are likely to rent and have higher housing costs in retirement.

The poorest fifth of the population experience a higher rate of inflation than the rest of the country in every year since 2003 except 2010, the report states. Because of this, many are falling behind with bills and unable to put away for a secure retirement. More than two million of the poorest households have “problem debt” and 70 per cent of people in work in the poorest fifth of the population are not contributing to a pension – amounting to around 2.3 million people.

Campbell Robb, chief executive of the JRF, warned political choices, wage stagnation and economic uncertainty mean hundreds of thousands more people are now struggling to make ends meet.  "Record employment is not leading to lower poverty, changes to benefits and tax credits are reducing incomes and crippling costs are squeezing budgets to breaking point.”

Rachael Orr, Oxfam’s head of UK programmes, meanwhile said it was “deeply concerning” to see more evidence that having a job in today’s labour market is not enough to escape poverty. She added: “It’s not just working adults who are affected, but their children too, and it’s a real worry to see progress on child poverty going into reverse.”

Alison Garnham, chief executive of Child Poverty Action Group, described the growing number of children in poverty as “bewildering - there is inaction. The question the report begs is why are we not investing in our children? Families with children have had a decade of cuts to their incomes and the damage is showing.”