Poverty Costs UK £78bn A Year

The effects of poverty in the UK cost the average taxpayer £1,200 a year, and the UK £78bn in total, a report says.

The Joseph Rowntree Foundation looked at how poverty - living on incomes below 60% of the median - affected different government services.

The NHS bore the brunt of the costs, it said, as those in poverty were "more likely" to suffer ill health.

The government said employment was key to beating poverty, adding that "we've made good progress".

The foundation, which funds research into social policy, said its total bill for poverty did not include money spent on benefits.

It said the research, conducted by Heriot-Watt and Loughborough universities, was the first to look at how much poverty across all age groups costs different government departments.

The report outlined the following key costs:

  • £29bn on treating health conditions associated with poverty
  • £10bn on schools providing initiatives such as free school meals and pupil premium for poorer students
  • £9bn on the police and criminal justice systems dealing with the higher incidence of crime in more deprived areas
  • £7.5bn on children's services and early years provision, such as free childcare for deprived two-year-olds
  • £4.6bn on adult social care
  • £4bn on housing

Self-employed carpenter Paul, 47, of Gloucestershire, said he suffered anxiety, depression and panic attacks following the death of his mother.

"I started using the food bank when I was on benefits and struggling to make ends meet sometimes," he said.

Paul started to work as a volunteer at the food bank by repairing furniture for people, and said it gave him the confidence to start working again.

"There's a lot of opportunities a food bank can offer, it's more than just a can of baked beans," he said.

The Trussell Trust, which aims to reduce poverty in the UK, said a record number of people were now using food banks, and usage had been rising since 2008.

In 2015-16 emergency three-day food supplies were handed out 1.1 million times across its 424 foodbanks - a 2% rise on the previous year.

The Joseph Rowntree Foundation report said the strong relationship between poverty and ill health was now "widely accepted" - especially in cases of malnutrition and people living in cold, damp or unsanitary housing.

Ill-health in turn could lead to further difficulty when people were unable to work.

There was also growing evidence of links between poverty and mental illnesses, where the stress of living in poverty triggered "serious episodes" of ill health.

Professor Donald Hirsch of Loughborough University, co-author of the report, said it was hard to estimate the full cost of poverty, "not least its full scarring effect on those who experience it".

And he stressed that "the very large amounts we spend on the NHS and on benefits means that making a section of the population more likely to need them is extremely costly to the Treasury".

Julia Unwin, the foundation's chief executive, called for "real action", saying: "Poverty wastes people's potential, depriving our society of the skills and talents of those who have valuable contributions to make. This drags down the productivity of our economy, hinders economic growth, and reduces tax revenue."

A government spokesman said it was "tackling the root causes of poverty" and cited "more people in work than ever before", the National Living Wage and free childcare as areas in which progress had been made.

He added ministers were "taking action" in further areas such as education and family breakdown.



August 2016