Rise in homes on inadequate income

Updated: 

Studio shot of woman's hand holding two pennies

The number of households on inadequate incomes has risen by a fifth in three years, new research has found.

Charity the Joseph Rowntree Foundation (JFR) said the onset of the recession, cuts to benefits and tax credits and the rising cost of essentials are to blame.

Its latest figures shows the number of households living below an acceptable standard has increased by 900,000 since 2008/2009.

It means 67% of single parents with between one and three children, and 28% couples with between one and four children, were falling short of the standard in 2011/2012.

The study, carried out by the Centre for Research in Social Policy, also found 36% of single working-age households failed to achieve a decent standard of living - set at £185 a week after housing costs.

Income adequacy is measured by the Minimum Income Standard (MIS), which is what the public think is needed for a minimum socially acceptable standard of living in the UK.

Families with children are the most likely to be living below an adequate standard, especially single parents.

Donald Hirsch, co-author of the report, said: "Young people, single people and people in private rented housing have done particularly badly relative to the Minimum Income Standard during the downturn.

"A whole generation of young adults are noticeably worse off as a result of the deterioration in their job prospects, a worsening of housing options and falls in real wages and benefits, making it harder for young people to be independent.

"Our figures show that those under-35s who do live on their own are much more likely than in the past to have far less income than they need for a minimum standard of living."

Katie Schmuecker, policy and research manager at JRF, said: "Many people have seen downward pressure on their living standards, but for those on low and modest incomes more are having to make tough choices about what essentials to go without."

Households in London face the greatest risk of being below MIS, influenced by high housing and childcare costs.

One in three households in Northern Ireland live below MIS, while regions including the South West and East Midlands have seen a steep increase in risk since the recession.

The report said the adequate disposable income is decided by asking members of the public to list items that would need to go into a basket of goods and services in order to achieve an acceptable living standard.

The figures in 2011 - after covering housing and childcare costs - were £185 for a single person, £287 for couples without children, £326 for a lone parent with two children, £425 for couples with two children and £233 per week for pensioner couples.

The study used the latest available data on household incomes.

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