10 June 08 – Government response to households below average income figures

The latest Households Below Average Income figures were published today. The statistics cover the UK income distribution in 2006/07, including the latest figures for the number and percentage of children, pensioners and working-age people in the UK living in relative and absolute poverty.

Today’s figures show that:

• The number of children in the UK experiencing low income and material deprivation – those who can’t afford basic things such as sending their kids on a school trip – fell by 100,000 between 2005/06 and 2006/07.
• The number of children in relative poverty rose by 100,000, both before and after housing costs are taken into account, to 2.9million (BHC) and 3.9million (AHC) respectively between 2005/06 and 2006/07. Between 1998/99 and 2006/07 the number of children in relative poverty has fallen by 600,000 (BHC) and 500,000 (AHC).
• The numbers of pensioners in relative poverty rose by 300,000 to 2.5million (BHC) and by 200,000 (AHC) to 2.1million between 2005/06 and 2006/07. Between 1998/99 and 2006/07 the number of pensioners in relative poverty has fallen by 200,000 (BHC) and 900,000 (AHC).

The vast majority of people are better off than they were ten years ago, with record numbers of people in work and billions more being spent on pensioners.

The figures show that over the last decade there have been substantial falls in the numbers of children and pensioners living in relative and absolute poverty, therefore the recent rises in poverty levels are disappointing. 

The numbers of working age people in poverty – the group least likely to be in poverty – have remained stable over the latest year on a before housing costs basis, even though the population has increased.

Responding to the figures, Secretary of State for Work and Pensions James Purnell said:

“We have made significant progress on child and pensioner poverty, lifting 600,000 children out of relative poverty and halving the number of children experiencing absolute poverty in the last decade. We've also lifted 900,000 pensioners out of relative poverty and 1.9m out of absolute poverty.

“Had the Government done nothing other than simply uprate the tax and benefit system, we estimate there would have been 1.7 million more children and 1.5 million more pensioners in poverty today.”

Employment and Welfare Reform Minister Stephen Timms said:

“Recognising the scale of the challenge in this year’s Budget we took significant steps that will lift around 500,000 more children out of poverty, underlining our commitment to halving child poverty by 2010 and eradicating it by 2020 so that all children have a decent start in life.”

Pensions Minister Mike O'Brien said:

“Pensioners are facing challenges with rising food and fuel costs. We need to build on the progress of 2 million pensioners taken out of absolute poverty since 1997.  

“That’s why we’re spending £575 million increasing winter fuel payments this winter, working with energy companies to lower pensioner’s fuel bills, and making it simpler for pensioners to get all the help they're entitled to - that's the goal.”

Children’s Minister Beverley Hughes said:

“Everyone in Government is committed to working together to eradicate child poverty. We are helping families to lift themselves and their children out of poverty by supporting them to move into and progress in work, and making it easier to access services through children’s centres and extended schools.  In our Children’s Plan we committed to working with families and their children, making sure that their needs come first.  

“We know that meeting our 2010 and 2020 targets will not be easy, but we will not abandon any of our children to a future of poverty and disadvantage and we remain 100% committed to these goals.”

DWP Press Office: 0203 267 5144
Out of hours: 07659 108 883
Website: www.dwp.gov.uk

Notes to editors:

• The latest figures on child, pensioner and working-age adult poverty can be found in Households Below Average Income (HBAI) 2006/07. HBAI figures can be downloaded from http://research.dwp.gov.uk/asd/hbai.asp along with a statistical press notice.
• From 1998/9 – 2006/7 the number of children in relative poverty fell by 600,000, before housing costs are taken into account.
• From 1998/9 – 2006/7 the number of pensioners in relative poverty fell by 900,000, after housing costs are taken into account.
• From 1998/9 – 2006/7 the number of pensioners in absolute poverty fell by 1.9 million, after housing costs are taken into account.
• Estimates that there could have been 1.7 million more children in poverty (before housing costs) and 1.5 million more pensioners in poverty (after housing costs) are based on HM Treasury and DWP analysis of what poverty levels could have been if the Government had done nothing other than simply uprate the 1997-98 tax and benefit system.