Families need £36,800 to live acceptably, study says

 
Family of four Researchers questioned 21 focus groups to find the income standard

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A couple with two children now need to earn £36,800 a year to have a "socially acceptable" standard of living, an anti-poverty charity says.

The Joseph Rowntree Foundation said its annual minimum income study suggests families must earn a third more than in 2008, to live within social norms.

But the report has been dismissed as "mostly rubbish" by the head of think tank the Adam Smith Institute (ASI).

The government said it was committed to helping the UK's "most vulnerable".

The minimum income standard (MIS) study - commissioned by the charity from the social policy research unit at Loughborough University - suggests a rising number of UK people live below what the public believes is an acceptable standard of living.

This MIS standard includes earning enough to eat a balanced diet, run a car and heat the home.

Researchers questioned 21 focus groups made up of working families, pensioners and single people of working age on a range of incomes.

A couple with two children were said to need to earn a minimum of £18,400 a year each before tax; single people £16,400 a year, while the figure for lone parent with one child is £23,900 and a pensioner couple £12,000 each.

The study said families are being hit hard by a "dangerous cocktail" of rising costs and cuts in three main areas:

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If, instead of thinking about the breadline, we consider what level of income is needed for an acceptable standard of living, the debate changes”

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  • Childcare: Minimum costs have risen by nearly a third since 2008
  • Travel: Bus fares have doubled since the late 1990s which when combined with cuts to public transport, means families with children now deem a car as an essential item
  • Benefit cuts: Earning requirements have increased substantially, cancelling out the benefit of higher income tax thresholds

JRF chief executive Julia Unwin said families faced a "monumental task" to earn enough to get by.

"Parents facing low wages and pressure on their working time have little prospect of finding the extra money they need to meet growing household expenses.

"Many working people face the risk of sliding into poverty. It illustrates how anti-poverty measures are needed to address not just people's incomes but also the costs that they face."

The research also states that the level of Universal Credit - the government's new benefits system being brought in January 2013 - will strongly influence the ability of households to reach MIS.

'Silly question'

Both the results and methodology of the study have been questioned by Dr Eamonn Butler, director of the think tank ASI, who said the report was "mostly rubbish".

What makes up the MIS?

Minimum weekly spend on some "socially acceptable" life essentials includes:

Household goods and services: Childcare: £147.85, beds and bedding: £3.29, garden equipment: £0.66

Food and drink: Meat £18.08, vegetables: £11.27, snacks: £3.65

Social and cultural: Parent social activities: £30.00, UK holiday: £18.52, birthday gifts: £8.42

Transport: Car: £60.25, public transport: £12.38, Cycling: £1.40

Based on a couple with two young children with a weekly income of £685

"If you ask a silly question you get a silly answer and I think this is a very silly answer.

"The idea that one needs a laptop, a DVD player, a microwave, a blender and a roof rack on your car and so on, and indeed a car in the first place when most of us live in cities and public transport has not actually changed very much in the last five years are very strange answers."

Dr Butler added that the study risks arousing people's expectations around welfare payments when "most of the public (75%) think benefits are too high".

But the study was defended by its co-author Donald Hirsch, who said the research was "significant" and "hugely robust".

"In terms of reliability... we have held over 100 groups over a period. Each group is checking back on what other groups say.

"It is not just one person at the ASI's opinion, it is groups of people coming to agreement... and then confirming it with subsequent groups," he added.

The government said it was forced to make "tough choices to repair the country's finances".

A spokesperson added: "It is vital that we give young children the best start in life and that is why we are rolling out free early education, backed by more than £1bn, to help children and their parents.

"We recognise that child care costs are an issue and that is why the prime minister launched a commission into this matter which will report back in the autumn.

"We are also introducing Universal Credit from 2013, which will simplify the system and ensure that work pays."

What is the minimum income standard?

Single working-age person Pensioner couple Couple, two children Lone parent, one child

Source: Joseph Rowntree Foundation

Weekly budget (excluding rent/childcare)

£192.59

£231.48

£454.52

£275.59

% increase since 2008

22%

15%

23%

31%

% of median income

77%

57%

77%

77%

% of budget* provided by Income Support/Pension Credit

40%

104%

60%

59%

Earnings

Weekly budget (including rent and childcare)

£262.25

n/a

£685.04

£502.80

Annual earnings required

£16,383

n/a

£36,728**

£23,861

Hourly wage requirement

£8.38

n/a

£9.39**

£12.20

* Excluding council tax ** If both members of couple work full time

 

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  • rate this
    0

    Comment number 348.

    This is a very valid attempt to quantify the level of income thought to be necessary to be "comfortable". GB is a very wealthy country, but it is expensive to live in. This benchmark is stable with previous attempts.

    It shows a family needs two incomes around the average. The scale by which people are falling below this level is very frightening.

    This is the true state of the UK

    Soup anyone

  • rate this
    0

    Comment number 347.

    I suppose this standard includes all those essentials like Sky TV, smoking, Drinking, expensive smartphone contracts

  • rate this
    +2

    Comment number 346.

    I'm on £21k with 2 children and manage to make ends meet, but very little saving possible hence no holidays, but I consider holidays to be a luxury not an entitlement. I'd be laughing on £37k.

    Dave1506 - pay off your mortgage before having children? I suppose that's one way of drastically reducing the birth rate!

    GB - only bringing home £18k from a combined £38k income .. really?

  • rate this
    -1

    Comment number 345.

    People at all income levels feel hurt not affording what they are used to but for the poorest this may mean something they really can't do without - housing, food or energy. This is truly socially unacceptable.
    MIS is meaningless, lots of strange values and items but not least housing for a family of 4 at £82.67 per week. What % of families on this the MIS income recognise this as realistic?

  • rate this
    +2

    Comment number 344.

    I think people should bear in mind that this study is not talking about £36k being the poverty line – it’s saying that £36k is the average level where a family with 2 children feels they are ‘keeping up with the joneses’. All this talk about benefits is mindless rightwing ranting.

  • rate this
    +3

    Comment number 343.

    336. The01
    1. move out of lLndon,houses are cheaper elsewhere
    2. move out of London, living is cheaper elsewhere,
    3. move out of London, social support would be a lot cheaper if so many werent living it up in the capital.

  • rate this
    -1

    Comment number 342.

    Budgets! Budgets! Budgets!
    Roar! Roar! Roar!
    You need to be a spreadsheet expert these days! The basic principles of life continues! If you disagree with the basic principles of life, then you've just reached the cut-off point! If you disagree with the basic principles of life, then you're about to fall flat on your face!

  • rate this
    +1

    Comment number 341.

    The figure of £36,800 masks huge variation around the country. The average male income in the City of London in 2010 was £97,000. The amount a family needs to live on is much higher in some parts of the country such as the South East than in others. These maps show the variation of income throughout Britain: http://www.gbmaps.info/income-maps.html.

  • rate this
    +1

    Comment number 340.

    Socially acceptable to whom?

    Define poverty!

    Think Globally

    Some peoples attitudes may change but not a lot I would suggest.

  • rate this
    +5

    Comment number 339.

    I've come across families where the failure of the main breadwinner to provide at least 1 foreign holiday per year and a new car every 2 would be considered grounds for divorce.

    Educating some people that conspicuous consumption does not define your success as a human being could be a very tough nut to crack....

  • rate this
    +4

    Comment number 338.

    It's to be true that right-wing knee-jerk reactionism is in force during every recession. Now we have all the NIMBY's frothing at the mouth at what they perceive to be 'more hand-outs for scroungers.'

    The sense of entitlement doesn't come from those who work for little other than subsistence wanting more, but from those who object to it.

  • rate this
    +1

    Comment number 337.

    316.nicknack1
    "greedy landlords"

    Why do people say "greedy landlords", are landlords not allowed to make a return on investing thousands of pounds? Which is the greedier/selfish, the land lord wanting thebest return possible or the tennent wanting it for as little as possible?

  • rate this
    +2

    Comment number 336.

    Problems are ;

    1. Housing cost to high, we need more houses

    2. Wages are not enough, as a working, single person with a decent job (£16000p/a before tax), i should be able to live rather than just exist.

    3. Tax avoidence buy large companies, we wouldnt need to cut services and soical support if companies were taxed fairly. They are the problem, not people who need/use social support.

  • rate this
    +1

    Comment number 335.

    A couple of years ago I was receiving £11,500 while for studying for my PhD. I managed to save just over £6,000 a year while living what I would consider an exuberant lifestyle. Although as a student I wasn't eligible for council tax I'm pretty sure I could live comfortably on £8,000 per year.

  • rate this
    0

    Comment number 334.

    Long gone are the days when things like going out to a restaurant, going to the cinema, staying up late to watch a movie or footy match were a treat. That's where the problem lies. During the Labour years no thought was given about the way in which we recklessly spent our money and became overdrawn, everyone wanted to keep up with the Jones's, now we are all paying the price.

  • rate this
    +3

    Comment number 333.

    119.RightWingIDBanned
    1 Hour ago
    If they need 36k per year I suggest they go to work and earn it.

    What are you on about. This article is about working people and families earning a minimum of £36k to attain a certain standard of living.

  • rate this
    +8

    Comment number 332.

    "Cut benefits for the unemployed but have a better gradient system that makes it more beneficial for them to get a job."

    I have a better idea: pay EVERYONE a set level of survival benefits, regardless of their circumstances or employment status. Then getting a job really WOULD be beneficial in any circumstance.

  • rate this
    +4

    Comment number 331.

    Re #266 its interesting that people now expect to holiday abroad. Povertys a sliding scale & does depend on what youre used to. Pensioners look at what constitutes child poverty today and frankly laugh comparing it to their childhood. Its depressing, but we all need to focus on essentials food housing utilities and ride it out with Govt concentrating on forcing down prices of these.

  • rate this
    -5

    Comment number 330.

    We all know the economy is based on a massive scam. People aren't going to work for nothing because they're becoming aware that there's more than nothing to be had. Either pay up or don't look surprised when london gets hit with a new wave of riots.

  • rate this
    +3

    Comment number 329.

    People should be educated to live within their means. Many people work hard for a much smaller annual income. I suppose this will push the benefits culture to demand they sit at home and get 36k in benefit, just because they can't find a job that pays 36k. I have to work away from home as jobs with decent wage packages are not available locally and certainly no where need 36K!

 

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