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:

Start Quote

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

End Quote
  • 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 608.

    I think if you live in London you need more than the report suggests me and my wife have just moved out of London and bought a house in Guildford, this is because we realised even with a combined income of over 100k a year we would struggle to pay for childcare, general living, two children and a ludicrous London house prices.

  • rate this
    -1

    Comment number 607.

    594.Loony Liberal

    unfortunately ridiculous rent rates have to be paid to have somewhere to live.

    Maybe i'm to proud to ask for help, but i don't want others to pay for me. If i have to work 2 jobs so be it.

  • rate this
    0

    Comment number 606.

    I can't help but notice the following per the "Minimum weekly spend on some "socially acceptable" life essentials" box:
    Food & drink = £33
    Parents social activities = £30.
    Surely if money is an issue they ought to decrease their unnecessary socialising and put it towards something more worthwhile or fuliffing for their children?

  • rate this
    +1

    Comment number 605.

    Re 598. blackie1947

    With such a well informed, evidence-based comment, you’re obviously someone who is familiar with research methodologies of this type. As the article points out, these figures are actually derived from the responses of ‘working families, pensioners and single people of working age on a range of incomes’ – in other words, ‘people like you’.

  • rate this
    +1

    Comment number 604.

    Joseph Rowntree Foundation is to be congratulated for setting out a counter-argument to austerity and for living in society. To live in society we have to depend o and, give respect to others. We all have duties and rights. Want has a severely disruptive effect on a society as do great disparities of wealth. Compassion builds social capital. Investing in mothers and children is best for society.

  • rate this
    0

    Comment number 603.

    596.Ex Tory Voter

    that may be what it says but i disagree with it. I know many many people who take the pee out of the system and its a lot more than 1 in 8

  • rate this
    0

    Comment number 602.

    599.BootRap

    No, using the one in work before logging at 5pm, but making the point I make no assumptions on your situatuion since I do not know you or your situation. As Ray has pointed out, we should ask questions.

    Anyway, have fun, logging for the day.

  • rate this
    +1

    Comment number 601.

    @599 Bootrap - not true. We're in the same boat - there's no chance we can afford to buy, and most of the families I know are renting. It's buy to let landlords who have created mini empires of houses (not the 2nd home "nest eggs") that have raised prices from 3x average salary to 5x av salary.

  • rate this
    +2

    Comment number 600.

    It seems people don't like paying for a safety net until they've had to use it, but I do wonder why. I don't mind paying for child benefit, even though I'm never going to have kids (unless I adopt, in which case I would have to be financially stable anyway). It's not about getting a return on the investment, it's just about doing the right thing by people who deserve a break.

  • rate this
    0

    Comment number 599.

    @591.Mayna

    What are you using the computer at the library before you go off to your tent outside the local council?

    @597.Sam
    when you price the singletons out of houses it may look as though they are living the high life, but in reality you have something much more valuable, a home!

  • rate this
    -2

    Comment number 598.

    This report should be put straight into the nearest garbage bin because that is exactly what it is - garbage. On what planet do these people live, I know people that live very well on half that amount and live quite well.

    I do hope our government do not take any notice of the idiots that write these sort of reports.

    What total and utter rubbish !

  • rate this
    0

    Comment number 597.

    @593 Bootrap - can you advise when I'm due a rebate then? I pay well over ten times in tax what I get in child benefit - it's my single mates who are out spending money and going on holiday as far as I can see!

  • rate this
    0

    Comment number 596.

    "590.WhatsTheWorldComingToo
    And I don't think the statistics of 1 in 8 are unemployed completely disagree."

    Google
    "housing benefit 1 in 8"

  • rate this
    0

    Comment number 595.

    590. "I'm saying i think the cap is too big, and i did actually put "cap" in my comment"

    Oh, of course. I'm just saying that a person in "normal" circumstances is unlikely to be receiving that much or even close.

    At the opposite end, a friend of mine can't get housing benefit to pay her half of the rent, because her fiancee is working. This seems quite outdated to me.

  • rate this
    +1

    Comment number 594.

    590.

    And I don't think the statistics of 1 in 8 are unemployed completely disagree.
    _____

    Well, it's more like 1 in 10 apparently, but you're probably closer to the mark frankly as the figures will be massaged.
    Youth unemployment (I'll bang this drum all day) is 1 in 4 though - the same people who will require the most help as they missed out on property bubble and can't afford ridiculous rent.

  • rate this
    +2

    Comment number 593.

    Those who work and have kids get their tax back so that they can buy up a few houses and get more tax relief. Those who have kids and don't work get paid the same as those who do. Buisness' use tax money to top up wages while the boss's and rich run their money through tax avoidance schemes to pay next to nothing. Who supports all these and gets shafted in the process? Yep the singletons!

  • rate this
    +3

    Comment number 592.

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

    Hardly surprising. Given a free hand, the ASI would have us living under the sort of ultra-competitive, Darwinian nightmare that would probably descend into a Mad Max style, survival-of-the-fittest, anarchic dystopia at some point.

  • rate this
    0

    Comment number 591.

    586.Ray
    "One of the functions of democracy is to allow us to question"
    Not sure about that, but yes we should always question.
    "Funny, I don't remember seeing that carved in stone anywhere"
    Neither have I but unless you view the opposite as everyone is identical in every way then there will be differences.

    581.BootRap

    That was an assumption & unfortunately an incorrect one.

  • rate this
    0

    Comment number 590.

    582.PatBenatar
    9 Minutes ago - I'm saying i think the cap is too big, and i did actually put "cap" in my comment

    587.Ex Tory Voter - as Rich stated though rent is cheaper for those on benefit. And I don't think the statistics of 1 in 8 are unemployed completely disagree.

  • rate this
    +3

    Comment number 589.

    @584 Stoktom
    Social housing is great and works well for a limited number of people, there are then many people who don't ,on paper, have a high enough level of need and hence may then have a disposable income of many thousands of pounds less per year. I once rented an ex-LA property, our LA neighbours paid approx 40% of what we did and would continue to do so even if their income was twice mine..

 

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