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
    +3

    Comment number 548.

    Meanwhile as the peasants stumble over each in the race to the bottom, the gap between profits and wages widens again. No wonder Bob Diamond smirked his away through the "inquiry", we can't touch them.

  • rate this
    0

    Comment number 547.

    @Rich - thanks for that - would love to pay £83/week rent, but where in the South East is that possible? We pay £950 pcm for a tiny flat in Hove ~£7k p.a more than the JRF figure.

  • rate this
    0

    Comment number 546.

    @527 You are correct, but the lifestyle you describe isnt sustainable for everyone (but great for the lucky few) You cant equate the freedom you had on foreign travels with the struggle faced by millions of families who are tied (either through work or family) to the UK in the current economic conditions. In poverty or wealth, living abroad on your own is not the same as bringing a family up here

  • rate this
    +1

    Comment number 545.

    @537 Sam this... http://mis.jrf.org.uk/ details the breakdown... £82.67 per week for rent so you can probably add another £4k at least for those on low income not fortunate enough to have a social housing rent or live in a very cheap part of the country.

  • rate this
    +2

    Comment number 544.

    Highest cost of living in Europe, smallest size of houses in Europe. Says it all really, this country is run by the rich for the rich. They are not interested in the state they leave this country for the following generations, all they are interested in is their own selfish greed.
    Making essentials for life unaffordable and blaming those less fortunate is just wicked and spiteful.

  • rate this
    +1

    Comment number 543.

    Bob Diamond could keep a few families then and still be quite comfortable himself

  • rate this
    +5

    Comment number 542.

    I live in London, so an income of £36,728 is not enough to rent a 1 bed flat, pay full time child care costs (£70 a day, with £10 per min penalties if you're late), bills & eat a healthy diet. My pay covers childcare & I'm not on a low income. My partner pays the rest with his salary & we only have 1 child. This generalisation doesn't take into account the differences in regional living costs.

  • rate this
    0

    Comment number 541.

    So we establish that £36,800 is required for two adults and two children plus benefits etc that are not taken into account, whilst a pensioner on £12,500 is likely to be stripped of their bus pass, winter fuel allowance etc, what an inconsiderate, pompous and cruel shower we have got in government, posh boys who have not a clue on living in the real world, roll on the election and get them out.

  • rate this
    +1

    Comment number 540.

    484. RTFishall

    The current government has done a good job in scapegoating the poor; you, like so many, go to it with relish!

    We need a generation to follow us; we don't get to pick and choose the individuals in that generation or who produces them. Any country should take good care of it's young and not be grudging of them.

    This article is about the cost of living; read it properly!

  • rate this
    +5

    Comment number 539.

    I quit working full time a few years back, having cut most of the fat out of the household budget and now get by on about £1200/month for myself and my wife. It means not going to the pub every other night, but I've never been happier. Stress levels are almost zero, and I can go out and enjoy the great outdoors (for free) as often as I want. Cut some luxuries and set yourselves free.

  • rate this
    0

    Comment number 538.

    @529.Stoketom, when you consider around 30% in every poind of income tax goes to the those at the bottom you can understand why people feel this way. In my case I that means around £250-300/month goes to those that cant are unable or unwilling to do some graft.

  • rate this
    +2

    Comment number 537.

    @531 Kelly

    I meant similar to £36k p.a, sorry not very clear.

    We do get child benefit (£80/month) but no other benefits.

    I'd like to know how people saying £36k is more than enough actually live, do they own their homes outright? Rely on top up benefits? Genuinely interested, as we struggle each month if there are unexpected expenses.

  • rate this
    +2

    Comment number 536.

    I'm glad they're talking about the level you need to live decently nowadays rather than just get by. We're in the 21st century, and we ought to have higher acceptable standards in society than hand-to-mouth.

  • rate this
    0

    Comment number 535.

    Incredible find it difficult on a salary above that and that is without a mortgage to pay. The cost of living is extortionate and I,m no way a flash harry with big car and many holidays.

  • rate this
    +1

    Comment number 534.

    Let's not forget that there's always an agenda in these 'studies'.

  • rate this
    +1

    Comment number 533.

    "499.Steve Milesworthy
    have men who aren't prepared to wear M&S undies but do wear vests and longjohns (£29 per year!)"

    Why sneer at that? Have you not had a job where you work outside all the time?

  • rate this
    +2

    Comment number 532.

    "Which only goes to prove that there really are some people who are "too dumb to vote". Unless, of course, you mean that "a lot of us would vote for higher taxes *on other people*"."

    I think you're confusing intelligence with self-interest, poppet.

  • rate this
    0

    Comment number 531.

    516.Sam

    I think your maths are flawed if you think a £2200 monthly salary equates to £10,000 per annum.

    Is it not the case that those with children also get child allowances / tax credits?

    I do know how costly children are to upkeep, however, and it is the same as an adult when they get to late teens.

  • rate this
    0

    Comment number 530.

    @525.AirWeb, Its easy, 1) theres an economy of scale with families especially in terms of food, 4 people do not consume 4x the amount that a single person does, 2) you give up going out 2-3 nights a week so save on beer money, 3) you go without in order to give your kids things.

  • rate this
    +1

    Comment number 529.

    517.JamesStGeorge

    And we won't sort problems out as long as those with a right wing tendency blame those at the bottom for all the problems. People need and want to see themselves doing well. In this society the only way people are measured is via their wealth. People will only copy those that they think are better off.

 

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