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Anorak | 25% of People in Wales Are in Poverty – Nonsense If We Count Properly

25% of People in Wales Are in Poverty – Nonsense If We Count Properly

by | 9th, March 2018

A new report out insisting that 25% of the Welsh are living in poverty. Our conclusion might therefore be that we’d not like to have Labour running the UK as they have been Wales these past few decades. But that would be partial, extreme and unfair. The truth being that we’re measuring what poverty is wrongly:

Growing numbers of Welsh families are at risk of being trapped in poverty, a major report warns today.

Research by the Joseph Rowntree Foundation shows Wales has a higher rate of poverty than England, Scotland and Northern Ireland.

What poverty is depends upon how we measure poverty. For the world as a whole we use the World Bank’s measure, $1.90 a day. There is no one at all in the UK living at this standard, not one single person.

Within the UK we use something called “relative” poverty. This is less than 60% of median household income. If you live in a household which gets less than 60% of £25,000 or so a year then you’re in poverty. Sure, it’s not great riches but it sure ain’t the same as that global poverty. Also, note that this is after benefits, this is total income, not just that from work. But note one more thing – that’s the national median income.

And incomes vary over the country. More than that, the cost of living varies over the country. It’s not just housing either – a pint’s cheaper outside London, outside the SE, than it is within either of them. But we don’t account for that at all. And as anyone who has ever tried it knows, trying to live in London on £25,000 a year is very different from trying to live on that in Abergavenny is.

The reality is that many of those described as “poor” in Wales actually have a higher standard of living – well, except for being in Wales – than many of those in London on nominally higher incomes. Britain does have regional variations in wages but it also has large regional variations in costs. Once we account for those differences, both of those sets of differences, much of reported poverty simply disappears.

The biggest problem we’ve got with poverty in the UK is that we just don’t measure it the right way.



Posted: 9th, March 2018 | In: Money, News Comment | TrackBack | Permalink